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 Types of Home Businesses
A couple of years ago I was involved in overseeing a government-funded study on home-businesses. It was an interesting time and we met with all sorts of people who fit under the broad umbrella of running a business at home or from home. It soon became obvious was that there are many, many types of home businesses; and many different reasons for being home-based.
The attitude of main street businesses who fear being undercut by "cowboys in their back-bedrooms" reinforces a particular stereotype of home-based businesses. Perhaps they are right, perhaps if they took into account the additional advantages of having premises as well as the costs, the difference isn't so great. That is a long debate for another time.
The vast difference in types of home businesses made me wonder at the wisdom of grouping these business together, but everyone does it and here I am creating a special category for home business too. So let's try to split them up into several overlapping sub-categories:
- Home is the business
Farms, tourism operations like bed & breakfasts,live-in hotels and motels are all home-based businesses
- Based at home because there is no need for an office
Think of tradespeople, contractors and consultants who are out at clients all day. Contact is via mobile phone (or perhaps a partner at home). They may do the books at home on the kitchen table or in a room set aside for the office. No clients visit them.
- New and innovative businesses
Many new businesses start with one person working at home with the aim of moving out as they grow and take on employees.
- Lifestyle business
These are run by one or two people who haven chosen to have a small business that fits in with their lifestyle or family commitments. They usually don't aim to grow or are waiting until conditions are right.
- Experienced business people
Some home business operators are experienced business people who know as much if not more than many main street business operators. Some are from the corporate world, some have a long small business background.
- New-to-Business people
For many home business operators, it is the first business they have ever run. Some have left employment by choice, some have a redundancy package, others are choosing home business as an alternative to re-entering the workforce, some have a day job while they build something new. It is easy for experienced business people to look down on these newbies, but who is to tell which ones will learn the ropes and go on to prosper and which will fail? Everyone has to start somewhere.
- Dreamers
These are the ones who are susceptible to those promises of sitting by the pool all day while their business earns them lots of money. We've all seen the ads - the internet is littered with them. Or they dream of writing the next bestseller, inventing a new gadget or offering a must-have service. While it may be tempting to scoff at these too, all enterpreneurs are dreamers and all are familiar with the scoffing of people whose feet are more firmly planted on the ground. Who is to predict which dreamers will find a way to make their dreams a reality?
Recognising which type of home-based business you are is part of working out what you want to change or keep, what needs improvement, what is important to you now and in the future.
At different times over the years, I would have fitted into all of these categories and although we are now a business with offices and employees, I still do some work from home.
What about you? What sort of home-business is yours? What stage of your business are you at?
by Gayle Dallaston January 12, 2008 11:26 AM
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