5 tips for the Home-Based Entrepreneur

People often struggle with how to be a successful entrepreneur based out of their home. The distractions are many, but the rewards are great! As with all entrepreneurial success, working from your home requires some upfront planning and discipline colored with your personal priorities and style.

1. Set up an office. Designate a space that is your own, preferably with a door, with your desk and equipment, a good chair, files, and everything that you need set up for maximum efficiency. That doesn’t mean that you always have to work from that spot, but when one son is practicing his drums and the other is on the guitar, it is nice to have a place to retreat to which is promotes concentration.

2. Invest in technology. Nothing wears you down faster than having to walk to a different room to plug into your printer every time you need to print a document. Set your house up with wireless technology. Purchase multiple monitors if that makes your work more efficient. Invest in the software you need. New solutions and improvements are developed daily which simplify the tasks at hand.

3. Know yourself. Understand your moods. Know the times of the day that you work the best, and schedule your work activities around that. I wake up in the morning with my mind already thinking about the day’s issues. On days that I am not scheduled with morning clients, I often grab a cup of coffee and start my day working on my laptop from my bed. I can accomplish a lot between 6:30-8:30 from that comfy location. In fact, that’s what I’m doing right now! Then I take a break to exercise and get dressed for the day before I start in again for another couple hours of concentrated work. Some days I pause my workday at 3 pm to drive children and make dinner, but then use the evening hours to finish up any research or reading that is needed while my children are doing their homework and my husband is reading as well. My point is that while my workday may look random and disjointed, it is actually a well-laid out schedule of activities placed during their most effective windows of time.

4. Block time on your calendar. This is an old Stephen Covey tip which I like to jazz up with color coding. Block off your income-generating work related activities in one color (client work, client meetings, etc.). Block off time for working on your own business in another color (your own marketing, accounting, strategy work, etc.). In a third color block off time every week for your important relationships (spouse, children, friends). In a fourth color block off time for community involvement. And in a fifth color block off time for you! The color coding is an effective way to see that you are building balance into your life which will help sustain your entrepreneurial spirit.

5. Focus. Work from daily priority lists to help you work with a purpose. When you sit down to work for a two hour window, make sure that you know what task (or tasks if you need variety) you are going to accomplish and then don’t let yourself get distracted by phone calls, e-mails, or interesting articles. This is not the time to change a load of laundry or load the dishwasher. You save those tasks for your breaks. You can judge what is considered worthy of an interruption, so hold yourself accountable. After all, you are your own boss, so hold yourself to the same standards that you would expect of your employees!

Although it doesn’t work for all personalities, with some planning and discipline you can successfully run your business from your home.

Why do I have to do my accounting?

What is accounting really? Techniques or a language that allows you to keep track of the money coming in and going out of a business. Many people are uncomfortable with accounting because they are unfamiliar with the terminology. I can’t tell you how many times I tried to explain to friends struggling with an accounting class in college how assets could be debits, liabilities-credits while income was a credit and expenses were debits. They always thought assets and income should act the same way. I tried to get into the theory behind double entry accounting and how the balance sheet and income statement flow through each other, but some people just got bogged down with the terms.

The nice thing about the invention of accounting software programs is that the terminology has really become a non-issue. With QuickBooks or other programs, the user is filling out forms or writing checks and the program “writes” the entries for you so you don’t need to know whether you are debiting cash or crediting sales. Once you let your discomfort over the terminology go, you can focus on learning how to use the program. Modern software has nice features built in that require you to enter data such as customer names and addresses only once and then each time you invoice that customer, all that information is automatically entered into the form. Even better, once you’ve learned how to use your accounting software, you can really reap the benefits of good accounting by learning how to use the many reports the programs can generate.

The whole point to establishing a good accounting system is to provide you, the owner, with the information you need to run your business. The less time you spend on the bookkeeping portion of the accounting process, the more time you will have for the analysis portion. It is the analysis that will point out the questions your business is asking you. While modern accounting programs can’t answer the questions, but they can point you in the right direction and give you the information you need to find the answers.

A successful small business owner learns how to make the most from her accounting process by selecting the right program, learning how to use the software, learning how to read the financial statements and using all the great information to make the decisions needed to keep her business moving forward.

Why do small businesses fail?

Even though the economy is starting to turn around, we still see too many small businesses closing their doors.  Why?

• The business didn't take the time to understand what set it apart from it's competitors or didn't articulate that to the market clearly enough.
• The business wasn't set up for success.  A well developed business plan wasn't created which listed all the start up expenses and assets required and located the funding for these expenditures.
• The business didn't know what it's break even point was and didn't systematically determine it's pricing.
• The owner wasn't prepared for how hard a small business owner has to work and the sacrifices that need to be made during the start up years.
• The owner lacked the people skills to effectively deal with employees, customers and vendors.
• The business didn't have proper financial information to make decisions and change strategies.  Good financial statements are NOT just for your tax preparer to use.  They help you understand what is or is not working in your business.
• The owner had insufficient or irrelevant experience to run their own business.  Many people who have always been an employee have no idea what it takes to be a business owner.  The owner of a small business has to know about labor laws and tax codes and licensing requirements and record keeping rules........

It breaks our hearts every time we see a business with a good product or that offers good service fail because it didn't have the proper infrastructure or organization.  We have often thought business owners should be required to take a class so they do understand all the rules and regulations they need to follow and all the other things they need to understand.