Source: Small Business
Management
Money Home Business Tips
#1
Don't Risk Financial Ruin: Have an Entry Plan
This
money
home business tips guide is intended to present 4 top home business ideas,
and the first one is this:
Depending on the nature of your business, it can take from six months to a year to get
underway, one to three years to turn a profit, and three to five years to become
self-sustaining. This means, in the context of
money home business tips, you must have enough money to cover your costs of living and
doing business during this start-up period. Consider these five entry plans as options:
* The Moonlighting Plan. Keep your full-time job and develop your business as a sideline
until it takes off and you can rely on it entirely for your livelihood.
* The Part-time Plan. Work a part-time job to provide a base income while you're building
up the operation.
* The Spin-off Plan. Turn your previous employer into your first major customer or, if
ethically possible, take a major client from your previous job to help launch your
fledgling venture.
* The Piggyback Plan. If you have a working spouse or partner, reduce expenses so you can
live on one salary until your business gets underway.
* The Have-Your-Clients-Finance-You Plan. If you have sufficient stature or expertise in
your field, obtain retainer contracts with a few clients for one year so you will have an
assured source of revenue.
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Money Home
Business Tips - Top
Money Home Business
Tips
#2
Don't Let Lack of Money Stop You: Arrange for Start-up Funds
Fortunately, most home businesses do not involve extensive start-up costs. As a result,
most people can "bootstrap" their fledgling operation using money from the
following sources:
* Credit cards. You can put many business expenses on a credit card. However, try to limit
charges to items that will pay for themselves by generating income relatively quickly.
* Personal loans. If you or a spouse has an existing job and a good credit record, banks
will usually give you a personal loan more readily than a business loan.
* Home equity loans. If you own your home, refinancing it is one way to obtain a reservoir
of start-up capital.
* Character-based microloans. The U.S. Small Business Administration and a variety of
private foundations offer microloan programs for very small businesses to handle loans
ranging from less than $1000 to $25,000. These loans are not based on a person's assets
but rather on good character and proven management ability.
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Money Home Business
Tips
#3
Don't Leave Payment to Chance: Get Written Agreements
When you work from home, contracts are your most important safeguard against problems with
customers and clients, and help ensure that you are taken seriously as a business.
Whatever your endeavor, create a standard contract to use, spelling out specifics such as
what you will provide, when you will provide it, what it will cost, and when customers or
clients are obliged to pay you.
While contracts can be verbal or written, written ones are certainly preferable. The best
way to develop contract agreements that are customized to your specific needs is to
consult an attorney. You can also talk with colleagues about the contracts they use, ask
your professional or trade association for information, or attend a workshop on
contracting. Many pro forma contracts are also available on computer software.
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Money Home Business
Tips
#4
Don't Get Caught Short of Funds: Keep Cash Flowing
If you are self-employed, having a system for managing your cash flow is essential to the
survival of your business. To use an analogy, cash flow is to your livelihood what breath
is to life. The following seven steps will help ensure that the money you're owed comes in
as quickly as possible:
* Get deposits, retainers or partial progress payments as often as you can.
* Get payment up front for expenses or arrange to charge them to your client's account.
* Bill immediately upon delivery of a service or product, instead of waiting until the end
of the month.
* Take bank cards instead of extending credit.
* Use a check guarantee service so you can accept checks safely.
* Offer discounts of two to five percent for receipt of payment within 20 days from the
date of invoicing.
* Act promptly on overdue accounts. The longer the account is overdue, the less likely it
is to be paid.
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