A home-based business is when you run your small business from your home. There are nearly one million home-based businesses in Australia, and this number is growing all the time.
You can run lots of different kinds of businesses from home. If your business mainly involves just you and a computer, it’s probably suitable to be a home-based business.
With the right qualifications and skills, you can turn these types of businesses into a home-based business:
- photography
- graphic design
- computer training
- web and software development
- accounting and bookkeeping
- writing and editing
- party and wedding planning.
Other kinds of businesses you can run from home include:
- hairdressing
- cleaning
- sewing
- jewellery making
- personal trainer
- buying and selling things online
- gardening and landscaping
- building and construction
- computer repair.
These seven tips will help you run a successful home-based business.
1. Make sure working at home is right for you
Working at home is not right for everyone. If you like being around other people, you could find it very lonely working from home.
If you get your ideas and your energy by talking to others, working at home might not be right for you.
Running a home-based business is usually best suited to people who enjoy spending lots of time alone.
When you work at home, you’re your own boss. This can be very appealing, but remember the downside. There isn’t going to be anyone to tell you what to do, or when to do it.
You have to motivate yourself and be organised. If you need to be reminded about what to do, or you have trouble staying focused on tasks, then you might not be suited to running a home-based business.
2. Have a business plan
Research your business idea and write a business plan before you start.
This process will help you decide whether or not a home-based business is the right thing for you. It will also tell you the kinds of things you need to do to set up your business.
3. Make sure your home is suitable
You’ll need to have enough space in your house to run your business. You’ll probably need at least one room to use for your business.
Consider the type of work you’ll be doing, and the needs of your business. If your work involves seeing customers face-to-face, make sure you’re comfortable with people coming to your house.
If you’re concerned about your privacy, and you’ll need to give out your home address to lots of customers, running a home-based business might not be right for you.
It’s also a good idea to speak to an accountant before you set up your home-based business. Ask what kinds of expenses related to your house you can claim as a tax deduction.
Generally, to be able to claim rent or mortgage for your business, it needs to have a separate entrance. This means there needs to be a separate door for the business that customers use.
4. Find out about local council regulations
Make sure your local council will allow you to run your business from your home. There might be laws and regulations that you need to comply with.
If it’s just you and your computer, there probably won’t be many requirements. But if you’re planning on running a business that makes things, you might need permits and licenses.
For example, if you want to run a food-based business from your home, you’ll probably need to go through a registration process. This could involve your local council’s planning department, building department, and food safety unit.
Visit the Know your Council website to find out which local council you need to contact.
Depending on what type of business you’re planning, you might also need special permission relating to pollution, energy use and parking. You might need permits relating to zoning, signage, noise levels or health issues.
Visit our page on how to set up your business for more information about regulations, permits and licenses.
5. Find out about insurance
Even if you have home and contents insurance for your house, this policy may not cover your business.
Find the right insurance for your business.
6. Don’t quit your job just yet
One of the advantages of running a home-based business is you can start small and scale up over time.
This means that you can keep working in your regular job to earn money while you build up your home-based business.
You can work on your home-based business in your spare time. When you’ve got enough work to cover your expenses, then you can think about quitting.
7. Keep work and leisure time separate
When your work life and your home life both use the same space, it can be hard to keep them separate.
You need to take breaks from work. It’s helpful to keep your work space separate from your after-hours space, so you’ve got a different place where you can relax.
Sometimes, friends and family might not understand that you’re working, even though you’re at home. Keeping regular business hours, and letting everyone know what these hours are, can make things easier for everyone.
Support services for home-based businesses
There are support services and networks available to help your home-based business, including:
- services provided by your local council – find out what kind of help they can give you
- events and training services provided by the Commonwealth Government
- the Business Victoria website, which has a whole section on setting up a business, including starting a home-based business
- networking groups and events you can join and attend
- business and industry associations. These are organisations that represent businesses in particular industries or locations, such as local chambers of commerce or retail traders associations.
Links
Business.gov.au – home-based business
Learn about running a home-based business, including your tax and insurance obligations, as well as where to go for support.