The Home Based Business Explosion Is Upon Us!

INTRODUCTIONPerhaps I should start by asking the question “What is a Home Based Business? This is any business operated from the comfort of the residential home of the owner.The next question is who is a Home Based Business owner? This refers to an Entrepreneur who decides to run his business from the comfort of his home.I decided to clarify these terms because there is a huge difference between a Home Based Business owner and a Home worker who might be working with a government/private organization but decides to be working from home once or twice during the week.Evolution of Home based BusinessMany businesses operated from home usually start as a Micro or Small Enterprise. Some eventually metamorphose into Medium Scale Enterprise and others eventually grow into quite large companies.The desire by Entrepreneurs to start operating businesses from home actually started in the 1980s. During this period, a lot of things combined to precipitate this massive desire by people to own Home based businesses.In the main, the combination of many factors like socio- economic change, improved technology and new management thinking resulted in the loss of otherwise permanent paid employment and this encouraged people to attempt to revalidate their freedom by opting to set up a business at home.The advent of new management thinking and theories like downsizing to make an organization Lean and more agile and efficient created fears in the mind of the average workerSo mass lay- offs helped create the right environment for some workers to go it alone and set up a Home based business.The period of late 1990 to 2010 can be appropriately described as the period of massive explosion in the establishment of businesses at home. The use of Computer, Internet and Mobile Technology helped in the growth of this idea.I strongly believe the idea of setting up business at home will continue to be positive and will remain so for a long time.The continued upsurge in the desire of people to own businesses has attracted the attention of Universities and other higher institutions. They have responded by introducing different courses and programs on Entrepreneurial studies to cater for these needs.Unlike earlier belief that businesses run from home are not well managed and don’t make good money, the present situation is that many Entrepreneurs motivated to set up business at home now have college degrees including a lot of high level professionals with business exposure.The entrepreneurial spirit is innate in all of us and we only need to be adequately motivated to take the necessary action.It’s really an exciting world out there.THE HOME BASED BUSINESS EXPLOSIONAs stated earlier, though the crave for running businesses from home started way back in the 1980s, what can be termed the explosion of this way of doing business was between the late 1990s and the first decade of the new millennium.(2010+)This coincided with the time when the setting up of a Home based business became a Fad. According to Mr Lewis of the National Association of Home Based Businesses, Home based business in the United States grew from about 6 million in 1984 to 23 million by 2007.With the help of modern technology like computers, mobile phones, printers and the huge power of the internet, more work is being done virtually than ever before and more global businesses are routinely being run from home.According to the 2012 GEM report, 69 percent of American entrepreneurs start their business at home from either a spare room in the house, the dining table or from the garage. The report further revealed that more than 50 percent of entrepreneurs continue to operate from home even after the business has taken off successfully and stabilized.Again according to Mr. Lewis of the National Association of Home Based Businesses, his own companies do training in 20 countries, import eyeglass frames from China and also develop condominiums.Mr. Nuyten of the Home Based Business Statistics in America quoted the following statistics as at 2012:38 million Businesses were operating from residential homes in AmericaA new business is started from home every 12 seconds in the United StatesThe Home Based Business sector in the United States earned Four Hundred and Twenty Seven billion dollars.It revealed that 70 percent of Americans would like to be self- employed.Entrepreneurship has become entrenched in the psyche of the average person. The Baylor University study of 2005 revealed then that more than 5 million jobs had been lost in Fortune 500 companies since 1980 while 34 million were created in small businesses.The United States Census Bureau data of October 2012, also revealed that the number of businesses being operated from home have been on the rise since 1999.The United Kingdom ExperienceThe continued growth in the Home based business sector appears to be a global phenomenon as the report from the United Kingdom will show shortly.The United Kingdom department of Business, Innovation and Skills released a report titled ” Backing for Home Business” which revealed that 2.9 million home based businesses in the United Kingdom contributed 300 billion pounds sterling to the UK economy. The report also stated that 70 percent of all new businesses in the United Kingdom started from home.According to Home Business report compiled by Enterprise Nation, 1,400 new businesses are started from home each week.This report also confirmed that out of a total of 4.5 million small and medium enterprises, 2.1 million are Home based businesses.Factors contributing to the growth of Home Based BusinessesThere are many factors motivating people to set up Home based businesses such as:

Losing one’s job

Being laid off in a time of economic downturn could be very devastating. With difficulty in getting new job offers, the next best thing would be to start a Home based business.

Flexible lifestyle

You are your own Boss. Literally, you can come and go as you please. You maintain better work/family balance. There are no set opening and closing times. You go for lunch and vacation when you feel like

Reduction in Stress level

The daily commuting, especially with the present heavy fuel costs is avoided. Also those train/bus rides to and from work with all sorts of characters is avoided.

No corporate office politics

You are not thinking of how to always please the boss and climb the corporate ladder. You don’t have to engage with difficult colleagues. Best of all, there are no dress codes.

Cheaper start up and running costs

It’s cheaper to set up a Home based business. A serious entrepreneur can get started with just $5,000. The main requirements could just be a computer, mobile phone, printer and a good internet connection. No rent of physical store space.

Secondary Income

Some entrepreneurs set up business at home to bring in extra income to support a day job. Some people start the business as a part time hobby. Eventually the business may become very successful and the entrepreneur will now take the decision to resign from the day job.

Be your own boss

You are your own boss. You have the freedom to do things the way you want. There is nobody breathing down your neck reminding you of targets.

Job dissatisfaction

An otherwise loyal employee may become unhappy with the company for lack of promotion and motivation. The next thought is to set up a Home based business.

Opportunity to achieve Self actualization

Having your own business gives you the opportunity to make as much money as you desire. This of course depends on how much money you want to make and the amount of time and effort you decide to invest in the business.Advantages of running a business from homeThe desire to get out of the rat race, avoid the daily grind coupled with the power of modern technology make telecommuting more productive.Together with some of the factors already mentioned above, listed below are more advantages:

Tax advantages

You can deduct some of your expenses as business expenses. These could be utility bills, insurance, mortgage and property tax.

Opportunities for Professional improvement

It is safe to assume that with the day to day running of your business, you will develop more business management skills.

Multiple streams of Income

With more time to yourself and the freedom to follow your lead, you can decide to explore other areas of interest and create multiple streams of income.Disadvantages of running a business from home.In spite of the almost glamorous attraction of Entrepreneurship, there are some disadvantages which must be effectively managed in order to improve the chances of success.

Irregular Income

For some one that had been used to regular pay checks, having to go through some weeks without income could be a huge challenge.

Lack of adequate space

This could arise where work sometimes spills into the home space

Nearness of Family and Friends

The nearness of family and friends could become a distraction if not properly managed.

Lack of Fringe benefits

Fringe benefits like health and dental insurance and paid vacations which were hitherto being enjoyed in paid employment are no longer available.

Friction with neighbors

The type of business you are involved in could create friction with neighbors due to noise pollution and lack of packing space

Health Issues

Staying glued to the computer screen and in a small space may affect health and fitness. So try and create time for exercise and recreation.CONCLUSIONSo as the French would say Voila! There you are! The idea of starting a business at home has become engraved in the mind of people. Every day, people are starting thousands of businesses in their residences all over the world.Though there are disadvantages in running a business from home, the advantages far outweigh the disadvantages.Some industry watchers believe that crave for setting up businesses at home is waning and the general trend could be heading downwards.However, I personally believe that the trend can only continue northwards. Why? Because I see all the indices still pointing positive. The factors that motivate people to set up Home based business are still very much around. There are still massive lay- offs going on in many companies and workers are still feeling short changed by employers.To crown it all, the technological tools like Computers, Mobile Phones, Printers and the Internet which assist Home Based Business owners to work smarter and achieve more with lesser effort are still evolving.Therefore I’m of the view that the trend of setting up businesses at home is still on the upward swing.So, how about you? What do you think? Is the trend moving up or going down.Let’s have your thoughts.

Home Based Business Opportunity – Were You Aware Of The Benefits Of Having A Home Based Business?

Home based business opportunity, what does this exactly mean? A home based business opportunity can represent a number of ways to start your own business from the comforts of home. You could decide to become a freelancer and write articles as a ghostwriter or make a website and sell your products that you have created as a home based business opportunity.A business operated from home can give you the freedom to work when you want to, as much as you want to, and wherever you want to. You can log in at a library and check your email and your website while being on the road if you don’t have a laptop. You can visit a friend and check on business and even attend a web conference while visiting with family during the holidays. The type of business is yours to choose and yours to control.A business operating from your home comes with great tax breaks. You can claim a home office whether it is a room, or ten feet by ten feet of space, by using a home based business. You can deduct whatever you use for the home office along with any equipment you had to buy to start your home based business opportunity. A great example is a brand new computer. You can use this for your new home based business opportunity and let it depreciate. Take all your pens, copy paper, and everything and claim as a business expense.You could be introduced to a business opportunity by a friend or something you were reading online. Maybe selling vitamins caught your attention or learning internet marketing as a great potential business opportunity. Or, perhaps you wanted to try affiliate marketing as a business based out of your home and not even touch the products or services at all. With this type of business, all you have to do is place classified ads and get internet users to click on your affiliate link. There are many great ideas to think about when you have a business you can run from your home.There are a lot of businesses available today that you can operate from home and they are structured to quickly get you on your feet and keep you financially stable. All you have to do is set goals every day, every week, and every month to achieve them and then once achieved; live your dream life.When looking for a home based business opportunity, be realistic about the goals you have set. It takes time for things to fall into place. Look for something you love to do in a home base business. If you are not sure about a specific type of business, try another idea that you are more comfortable with. You can start slow in your business by reading and learning before the actual doing. There are plenty of eBooks and how to websites to give you help and ideas to make your business a success.A Home Based Business can give you the freedom you need to have more time with your family. You never know, a home based business opportunity may entice some of your family members to start their own venture alongside you!

Options on Financing a Business Via P O Financing and Inventory Financing

It’s a good news/bad news situation at its classic best. Your firm has the ability to receive orders or contracts but you are challenged with restrictions or unavailability of inventory and PO (purchase order) financing. Financing a business based on assets such as inventory and orders in coming has never been more of a challenge in Canada.When we speak to clients we advise there is no one method that seems to handle all inventory and P O finance challenges. But the good news is that via a variety of effective business financing tools you can employ you are in a position to generate working capital and cash flow from these two asset categories. Let’s examine some real world strategies that have made sense for clients.The root of the problem is simply, you have orders and contracts, but those will potentially be lost to a competitor. Conventional wisdom is that you go to your bank and ask for financing to support inventory and purchase orders. As you may have experienced, we aren’t big believers in conventional wisdom on that matter!However, utilizing a convention purchase order funding source does allow you to purchase product and get your suppliers paid, thus facilitating you ability to deliver to your customers.One of the main benefits that many clients don’t realize is that inventory financing and P O financing don’t necessarily require your firm to have a long or strong credit history; the focus on structuring the transaction is around the inventory being financing and the general credit worthiness of your client, who will be paying yourself or the inventory or P O financing firmThe overall process is fairly simply and easy to understand when it comes to putting the transaction together successfully. On receipt of your confirmed purchase order your supplier is paid via cash or a letter of credit. Your firm of course completes final shipment of the product, which typically involves some additional time on your firms part. On shipment and of course payment from your customer the transaction is in effect settled. In a true pure po financing scenario the P O funder is paid immediately on your invoicing of the product. That is facilitated by your firm selling the receivable via a factoring type transaction as soon as you have generated the invoice.There are always limitations to this type of financing – so things we look for early in the transaction are the ultimate remarket ability of your product in case there is a transaction risk. Naturally, as we stated, the overall credit worthiness of your customer is key, his receipt of goods and payment in effect closes the transaction.Inventory financing and PO financing are generally more expensive than traditional financing, due mainly to the significant transaction risk that the lender takes. Therefore we strong recommend that your firm has solid gross margins in the 25% range to cover the associated costs of a po financing, inventory financing transaction that also factors in the time it takes to get paid by your client, as that typically adds 30-60 days on to the whole cycle of the transaction.If there is one great tip of ‘ secret’ that we share with clients its simply that the best method of ensuring financing in the manner we have outlined is to consider an asset based line of credit. Coupled with a facility that will finance your purchase orders this is the ultimate working capital tool that will allow you to grow business quickly and significantly. This type of facility is generally a non bank facility and is offered by independent finance firms.Speak to a trusted, credible and experienced Canadian business financing advisor who will assist you putting together a working capital and cash flow solution that works!