SIX IMPORTANT QUESTIONS FOR PROSPECTIVE HOME BUSINESS OWNERS Experts predict that by the year 1995 at least 15 million Americans will be working at home, operating their own home-based businesses. This expected proliferation of home business operations is already underway. The troubled economy has helped to instigate the home business boom, giving hesitant entrepreneurs the incentive needed to "go it" on their own. Well over 1000 new home-based businesses are starting up each day and the opportunities for other such ventures are wide-open to anyone willing and able to do what it takes to be successful working at home. Even though more and more people are finding success and happiness as home-based entrepreneurs, the decision to quit a full-time job and start up a business should be carefully thought out. There should be a "reasonable" amount of certainty in the success of the proposed new business before leaving behind the security of steady work and a regular paycheck. Many home-based business failures are due to poor planning and bad judgement. Simply being "fed up" with the "rat race" and wanting to be your own boss are not, in themselves, sound enough reasons to leave a good job for the uncertainty of "self-employment". Of course no one can guarantee success, but affirmative answers to several important questions may mean you have what it takes and are ready to become a successful home-based business owner. (1) Do you have the financial reserves to keep you and the business afloat, if necessary? Unless you've already had some success operating the business on a part-time basis, and are guaranteed at least a small amount of income, be prepared to experience some hard times. For the first several months, possibly a year or more, your business-generated income could be sporadic to nonexistent. That's why a healthy cash reserve is necessary. You should have enough money in reserve to support you and your family as well as to keep the business operating. It is advisable to have money reserves sufficient to last from 6 months to 1 year or more (the latter is preferable) without having to depend on income from your new business. You'll also have to be prepared to either sacrifice, or assume payment of any benefits (such as insurance) that were previously paid by your employer. (2) Is there a demand for the product(s) and service(s) you'll be offering? Some new home-based business owners fail because they neglected to first determine if there would be an adequate market for their product and/or service. If there is no market for the type of business you wish to start-up, it's better to find out about it before you quit your full-time job. Otherwise you could very well be sinking thousands of dollars into a venture that is destined to fail. Some good ways to find out your market potential include conducting feasibility studies and other market research. By getting out and talking to potential customers you'll get a good idea of how receptive they will be to your business. One sure way for prospective entrepreneurs to insure failure is to neglect to determine if there is a need for their product or service and then enter a glutted or indifferent market. (3) Are you self-motivated? Being your own boss requires exercising consistent, unflinching discipline. In effect, you must make yourself go to work on a regular basis. Not having to be at a specific place at a specific time 5 or 6 days a week can give a person a false sense of freedom. Operating your own business, you will have to determine your working hours and then adhere to them as faithfully as you would if you were working for someone else. A home-based business has many built-in distractions. There's no time clock to punch--no supervisor or foreman lurking in the shadows to make sure you get the job done. When you operate your own business, you alone "crack the whip". If you lack what it takes to be a self-starter, the odds are you are not entrepreneurial material. (4) Is your family ready for such a change? When you begin a new business, practically all of your time and energy will go into getting if off the ground and making it a success. You will most likely be working late into the evenings and on weekends as well. Such a change in work habits, while hard on you, can take a heavy toll on family life. It is important that your family be supportive of your new venture. Without family support and understanding, it could be very tough to maintain harmony and keep your mind on business. No one needs to be faced with choosing between family and business. If you family is not ready, and does not support your entrepreneurial desires, the time is probably not right for you to become your own boss. (5) Do you communicate well with other people? No matter how good your ideas, products, or service may be, if you can't communicate with other people, your chances of being a successful entrepreneur are not very good. You'll need to be able to convey not only yourself, but your business as well, in a positive and convincing fashion. The ability to communicate requires a certain level of confidence, and operating a business requires a personality that possesses the confidence to sell a special product or service. Without that confidence, and with an inability to communicate the benefits of your business to the largest possible market, about the best you can hope for is to break even. (6) Do you have a business goal? Anyone who is planning to start a home-business must have a goal. Your goal can be put into practical terms by coming up with a business plan which includes a description of your product or service, a short market analysis, and pertinent financial information including start up costs and projected monthly expenses. Once you have a business plan in writing, you'll have something to show potential investors, as well as proof to yourself that you are serious about your venture into business. If you can not come up with a clear and comprehensive business plan, then your ultimate goal is probably unclear as well. Without the certainty of a clear-cut goal to guide you, a cohesive business plan will also be out of your reach, and the time probably is not right for you to enter into business for yourself. If you answered yes to the six questions in this brief report, then you are most likely ready to become a successful entrepreneur. Of course there are other factors that should also enter into your decision to start your own home business. You must be willing to invest not only money, but a lot of hard work as well. A home-based business can test your patience and, most likely, your financial resources. If you are not willing to make some necessary sacrifices, the life of an entrepreneur is probably not for you. But, if you have the desire and the discipline to persevere, owning and operating your own home- based business can be both financially and personally rewarding.