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8 Factors to Consider When Starting a Home-Based Business

A home-based business has three key benefits. You get to save on rent money, commute expenses, and time. It is a good idea, especially for entrepreneurs starting out with limited capital, or just for anyone who would love to work from the comfort of their home. This article highlights some of the factors you should consider when starting a home-based business.

Zoning Laws

Before you register a company and start operations, check if there are any laws that may force you to close your business later. Zoning laws will be different depending on where you live. These are normally set by the local authorities and the restrictions on businesses are done to prevent disturbance and maintain peace and safety in the neighborhoods.

License and Permits

Once you are sure that it is okay to run your business from home, apply for licenses and permits. And just like zoning laws, licensing and permit laws are different for every location. According to the U.S. Small Business Administration, you may require a general business license, professional and trade license, sales tax permit, sign permit, home occupant permit, health and safety permit and construction permit. The types of permit and licenses you need will depend on your location and the nature of your business. Don’t forget business registration too.


Next, consider getting an insurance cover for your home-based business. You will require some extra coverage because your homeowner’s insurance will not cover your business. Inform your insurance provider that you are opening a home-based business and they will advise you on the extra coverage you need. Generally, the extra coverage should cater for all property you use for business, and third-party injury and damages. For service providers, professional liability insurance is necessary. Don’t make the mistake of failing to inform your insurer about your business venture.

Home Office

Working from the couch can be comfy, but it may not be the best location for productivity. You may be tempted to watch TV or even take a nap. If you want your home business to be successful, design a good home office with a comfortable office chair and desk. If a lot happens around the house during the day, consider moving your home office to the garage, or you could even add a new structure. However, check local laws to ensure that it is legal to build a new structure and get the right permits before construction begins. Ensure that your working space is free from distractions and that it has enough lighting and ventilation. Also, add some office décor and don’t forget to display your qualifications and operating licenses. With a good-looking office, your productivity will be high.


Where are you going to keep office supplies, old files, and your stock? For office supplies and files, some shelves with drawers in the office and the garage can work. The bigger issue is handling the inventory, especially for businesses with large sales volume. For starters, you can start by ordering smaller quantities and using your garage for storage. As the business expands, or when you start making profits, you can get some space elsewhere to act as your warehouse. Before you open your business, check warehouses for rent in your area.


All individuals earning an income are expected to report their earnings and pay taxes. If you don’t pay taxes on time, or if you underpay, you will end up paying more due to interest and penalties. Therefore, keep proper records and hire someone to do your taxes if you have never done it before. If you want to do your own taxes, make sure that you are familiar with self-employment tax guidelines.

Work Days

It is easy to get caught up in home cleaning or cooking when you have pending work. To avoid this, set working hours and list the things that you will do each day in advance. Avoid doing other things around the house before you are done with work.

Business Growth and Improvement

Once your business is running, ensure that you are continually looking for ways to grow and expand. You can further your education using programs such as Suffolk University Online to gain more skills to manage your business more effectively. You should also consider seminars, business coaching and networking.

Finally, don’t forget to market your business continually. Set some time to create brand awareness and interact with your existing customers or clients. If you are busy throughout the day, consider hiring a marketing professional.