When you’re interested in starting a business or are already running a small enterprise, you’ll come across a lot of articles offering advice to first-time entrepreneurs. Often, the pursuit of growth is extensively discussed and encouraged. Yet in these times of economic uncertainty and instability in terms of oil prices and global supply chains, it’s possible that growth isn’t something every business should be pursuing at the moment. The case for making the transition to a home-based business may be stronger than ever; here are three key factors which can influence your decision in this respect.
Overhead cost reduction
In major cities around the country and across the globe, the cost of living just keeps on going up. Populations grow, but finite resources such as real estate don’t scale accordingly. Even solutions such as high-rise buildings can only go so far in terms of creating additional space. A commercial lease and the accompanying overhead costs, such as furniture, landscaping, and maintenance – will probably be the most expensive item on the monthly budget for a typical small business. By running a business out of your home, you can qualify for income tax reductions and lower overhead costs. Some adjustments might be necessary – industrial flooring systems are essential if you plan on brewing craft beverages on your property, for instance. You may also want to check with local authorities or landlords, if applicable, to make sure that certain operations are permissible where you live. But the substantial cost benefits are always a big motivation to make the shift.
Recent years have shown a growing trend towards telecommuting and even full-time remote working arrangements among employees. Many people enjoy the flexibility of working from home; while some employers had been understandably hesitant to allow certain tasks to be carried out from outside an office environment, the recent quarantine-enforced necessity of remote working for many businesses has proven beyond doubt that with the right setup, work can be accomplished in a productive manner. From the point of view of a small business owner, this can yield significant savings in terms of transportation – both the miles traveled and the general hassle involved in commuting to work. As the use of apps like Zoom or Slack becomes the norm, you can hold meetings and collaborate with people across time zones; all involved can avoid expending additional energy or resources on the logistics of travel. And you can help save the environment as well, thanks to the reduced emissions from all those trips saved.
Transporting your business from the commercial office space to your property means that it will inevitably become integrated with personal living. For some people, this is almost entirely an upside – it means you get to spend more time with your family, and enjoy the comforts of home. But others thrive on the increased social interactions which can occur at an external workplace, and there’s always a chance that a home environment presents increased opportunities for distraction. Consider if a home-based business is the right fit for your lifestyle; if not, explore ways to make the arrangement work, such as a property renovation or extension (possibly tax-deductible) where you can set up a professional working environment.
Reducing operational costs by setting up shop in the same place where you live is a great way to stay small in uncertain times. Examine these aspects to understand if it’s the right solution for you, both on a personal and business level.