Outline the mission statement, which should detail exactly why you are in business. Beyond that, write down the goals for the business, how you will meet the goals, who will be responsible for them and when they will be realized.
Evaluate the cost of the service or product in the outline. For instance, determine the costs of all materials found in the product, labor costs for creating the product and the cost for indirect materials and labor, such as supplies and clerical services. Figure out the cash flow by starting with the purchase of the inventory and following through to how payment is collected.
he business plan should also address the following points:
- who the customers are and their needs
- your knowledge of the business
- your qualifications
- pricing models
- how the finances are managed
- projections for the future
- how it is different from the competition
Identify the amount of startup funds and the type of financing you will need and their source. Prepare to invest 20-50% of your own money into the business and know that the average startup costs are $10,000 and upward.
It's important to understand and follow federal, state and local government rules. Papers must be filed if you incorporate, or want to protect the name of the business. Go to your town office or city hall if licenses and permits are needed to operate the business. The local code-enforcement officer can let you know whether you comply with zoning restrictions.
Register for an Employer Identification Number if you plan to incorporate or if your partnership or proprietorship has employees. The business area or home office must be part of the home and used on a regular and exclusive basis in order to qualify for a tax deduction from the
Think Professionally
Create a business environment that maintains professionalism and allows you to function well. Analyze the space you will need for the office, production, tools and equipment, clientele and pick-up and delivery. Consider the location, traffic and parking.
The following are some important items you may need to include:
- a home computer
- an address or post office box
- a separate telephone line
- voice mail
- a fax machine
- company letterhead
- a separate bank account
Conclusion
Deciding to start your own business from home is obviously a big step, but with the right forethought and preparation it can be a rewarding experience, both professionally and personally.
A critical component of a successful business is the budget. Read Six Steps To A Better Business Budget to learn more.
