This guide was a standard issue on the subject of working and running a business from home to Careers Services and Employment Services in the UK for a number of years and was made freely available to members of the public.

To ensure that some guidance on this subject remains freely available even to non-HBA Members, a regularly updated web-based version can be found in 3 parts here under the title 'So You Want To Run A Business From Home?'

A supplementary Success Guide to Working Successfully From Home has been written by HBA columnist Rachael Ross and further details can be obtained here: http://www.thesuccessguideto.com/

The copyright for The Smart Guide to Working from Home is owned by the Home Business Alliance.

The Smart Guide to Working From Home
by Avril Harper

Published by
The Home Business Alliance

CONTENTS

Chapter 1: Your Role

Chapter 2: Homeworking: How to Find Genuine Work

Chapter 3: Business Basics

Chapter 4: How to Find Customers

Chapter 5: Finance and Insurance

Chapter 6: Sources of Help and Advice

Useful Addresses

PUBLISHER’S NOTICE

While reasonable care is taken to ensure the accuracy of the information presented, no responsibility can be accepted for the consequences of action taken based on any information, opinions or advice contained herein. Readers undertaking business activities do so at their own risk. As with every venture involving investment of time, money or effort, we recommend that you seek the opinion of a professional advisor prior to assuming any risk.

No part of this guide, either in whole or in part, may be stored in a data retrieval system or transmitted in any form whatsoever or by any means, electronic, mechanical, photocopying, recording or otherwise, without the written permission of the Publisher.

© The Home Business Alliance 1996 - 2011

Chapter One

Your Role

Homeworker

.....The term 'homeworker' traditionally covers any person over the age of 18 years, who works in domestic premises, and is provided with work which is returned when completed to the provider or some third person. In short, although the homeworker might not be classed as an employee, there are very close similarities. Typically, the homeworker must work to rules laid down by the company, must work to a specified standard, and is liable to be terminated if standards fall short of those expected.

.....Benefits to the homeworker include: working the hours one chooses; freedom to attend to other commitments; flexible hours to fit around family, holidays, illnesses, and so on.

.....Disadvantages are also plentiful, and include notoriously low pay for homeworkers, usually low earnings potential (most tasks are long and boring), little or no employee protection, and unscrupulous employers are a common feature of many homeworking schemes. Also bear in mind that very low wages are illegal, although very few homeworkers would risk jeopardising their position by complaining, however low the rewards. Complaints are therefore few, and very rarely is a homework dispute brought before the courts.

.....Despite the disadvantages, many people are looking for genuine homework. We therefore devote Chapter Two of this Guide to this subject, "Homewoking: How to Find Genuine Work".

Teleworker

......Information technology-based homeworking frequently, but not exclusively, falls into the category of “teleworking”. This is officially defined as “working at a distance from your employer, either at home, on the road, or at a locally-based centre. Teleworkers use computers, telephones and faxes to keep in contact with their employers or customers”.

Freelancer

..... Freelance activities include writing, consultancy, research, typing and secretarial work, proof-reading and copy-editing. The main common denominator is that the freelancer, despite being self-employed, frequently feels he is 'working' for someone else, namely the person who ultimately pays his fee. That someone might be a publisher or editor, the manager of a firm whose business documents you type, the principal of a college whose theses you mark, or the manager of a mail order company whose direct mailshots you process.

.....In almost all cases, the freelancer relies on regular business from established clients. Lose one major client and your business could suffer dramatically. Moreover, the freelancer is frequently controlled to a larger extent by clients than most self-employed people. For the freelancer, the client usually has a greater say in how the business is run, what standard is expected, how work is processed, how payment is made and when.

Self-Employed Agent

.....Agents usually sell and earn commission on all orders generated by them. You might be selling insurance or airline tickets, cosmetics or household goods, jewellery or typesetting services. The list is endless, so too the amount and range of rewards available.

.....Selling takes a variety of forms, from door-to-door retailing, direct mail, to advertisements in newspapers and magazines, party plan, and so on. Consequently, with a number of marketing styles to choose from, there is almost certainly one that is best suited to you and your lifestyle. You can even combine a range of agencies into your overall business portfolio, concentrating on those that suit you best at any point in time.

Proprietor

.....The proprietor runs his own business, as indeed do agents, franchisees, freelancers, and sometimes homeworkers. The main difference is that usually the proprietor works independently of other businesses, with the exception of business customers. Proprietors decide what to sell, how to sell it, where to advertise, how much to charge, whether to ask for cash in advance or to offer credit facilities to customers.

.....Most small businesses run under this banner, from taxi firms to secretarial bureaux, animal boarding kennels to mail order companies, direct mail specialists to home publishers, newsletter publishers to traders at car boot fairs.

Franchisee

.....The franchisee works as part of an already established business. The latter, the parent company, licenses out rights to work under the company name, in return for which the individual pays certain start-up fees and sometimes ongoing royalties and other fees to the parent company.

.....The parent company is the 'franchisor'; the person who buys into the business is the 'franchisee'. Many major household names operate in the franchise sector including Prontaprint, McDonald's and Chem-Dry.

.....Franchising offers a variety of benefits including backing from a recognised company, access to tried and tested marketing materials and processes, ongoing guidance and support from the parent company, training, product orientation, and much more. On the debit side, franchisees frequently report feelings of dependency on the parent company, and many express similarities to working for someone else rather than being masters of their own ship.

..... A vast array of information is available to anyone considering starting up in the franchise sector, much of it from special franchising publications available on newsagents' shelves, from regular national and international franchising exhibitions, books and information products, franchise consultancies and the industry's main representative, the British Franchise Association. (see Useful Addresses)

DECIDING WHAT IS BEST FOR YOU

..
.It makes sense to look for a business you will enjoy, one that is satisfying now and in the years to come.

.....This means making sure the venture you select is right for you in the personal, financial and business sense, and that you are right for whatever business you choose. Taking time to make sure you and the business are worthy partners makes all the difference between a pleasant, lucrative endeavour and one that is a major headache, loses you money, and becomes an unbearable burden.

.....So, if you are looking for a chance to travel, maybe spend long weekends away from home and take several foreign holidays a year, it's pointless to consider tying yourself down to a home-based business needing constant supervision by you. Boarding kennels, retirement homes and small corner shops are useful examples. Freelance writing, consultancy, home publishing, import/export, mail order and direct mail might, however, be suitable. Whereas for homeworking assignments, survey jobs for example, are available.

.....A successful business represents a match between you, the business, and your customers. Where there is mismatch, there's bound to be strain. You must take time to analyse yourself, your personality, your own strengths and weaknesses.

.....Start by listing your own strengths and weaknesses, and ask friends and relatives for an objective view. Detail the things you want to do with your life, such as travel, or spending time with your children, the number of hours you want to work each week, where you want to work from, what access you want to customers, and so on.

.....List your interests, and include any business ideas you think might suit you. When both lists are complete - it can take weeks - cross-check each business idea against your personality profile. Tick any that offer the things you want from life, delete those that don't.

.....Obtain as much background information as you can about those businesses left on your list. Decide how much capital you need for each, how long it might be before you achieve break-even point and ultimately start earning profits, and look at the things you'll need to start the business as well as what equipment you already have.

.....A home secretarial agency, for example, really needs just a computer or word processor and a quiet spot to work from. If you already have those things, capital should not be a problem. Conversely, if you decide to start a small corner shop, you'll probably need capital to keep you going for at least a few months, maybe years, until profits exceed running costs.

.....Most importantly, if you need to borrow, make sure you borrow from reliable sources. If possible, resist the urge to use your home and possessions as security. And always prepare a proper business plan; it helps you and your business stay on course and is essential for anyone seeking outside investment.

DO YOU NEED FURTHER TRAINING?

.Although you may be very well qualified with regard to whatever product or service you offer, you might need to brush up on your business skills. Good marketing skills, accurate bookkeeping and effective customer liaison are all essential to the modern business. Successful ones at any rate!

.....Various books, complete business packages, courses and other information products are available to guide you through the basic and more complicated aspects of business management.

OTHER POPULAR INFORMATION SOURCES

Banks
Most banks have Small Business Advisors or sections whose role is to help new and established businesses. Their service is usually free, even if you don't already bank at the appropriate branch. Banks offer a wonderful assortment of information products, including books, videos and audio cassettes, pamphlets, and so on, usually free of charge.

Government-Sponsored Training Courses
A number of courses and seminars are available to new and established business owners, usually free of charge or for a small token fee. Ask for further information at local Jobcentres.

Libraries, Business Schools and Further Education
The Open University provides a wide selection of self-contained courses and study packs, as do most other popular correspondence schools. Also, the University for Industry offers online courses through Learn Direct. Make sure that your chosen course is endorsed by The Small Firms Enterprise Development Initiative (SFEDI), which sets national standards for business training.

Independent Specialist Sources
Vital skills such as marketing, telephone selling, how to improve or get more business, managing yourself, time, people, finance, etc, etc, all can be referred to time and time again through the pages of books written by acknowledged experts. visit your local library, or bookshop or an independent supplier of business books.

The internet
Almost the first port of call these days but your search should be tempered with caution. Many sites offering advice have only recently been created to jump on the perceived 'homeworking' bandwagon and information can be patchy or out of date; other sites are thinly disguised affiliate programmes or even outright scams. Tread very carefully.

YOUR BUSINESS ENVIRONMENT

.....Operating your business from home is a useful way to cut down on running costs. Various tax incentives allow you to offset part of the costs of running your business against profits, and being home-based means you can fit work around your other responsibilities, work the hours that suit you best, and so on.

.....If yours is rented accommodation, you might need permission from your landlord, or council, before you will be allowed to operate a business from home. Certainly as far as local authorities are concerned, you are unlikely to be refused permission, except where your business causes nuisance to neighbours or generates a high degree of pedestrian or vehicular traffic. Other factors that might lead to permission being refused include excessive noise, offensive emissions, traffic congestion, etc..

.....One problem you might encounter when running your business from home involves capital gains taxes and local property taxes, usually applied where one or more rooms are reserved entirely for business purposes. To avoid liability, try to work in the normal home environment, maybe in a quiet corner of the living room or from the garage, whatever suits the business you are running. Alternatively, where one room must be set aside for business purposes, leave a few small items of domestic furniture in the room.

.....Next you must decide what space you need to work, depending on you and the kind of business you run. For some businesses, like consultancy and telephone sales, a separate office is preferable. For others eg. freelance writing, mail order and multi-level marketing, a corner of the living room will often do.

Regarding your workplace:

• Place your desk or workspace near to a natural source of light.
  

• Have computers arranged with their screens at 90 degrees to the light source. This helps to reduce glare.

• Organise an efficient filing system before establishing your business. This means you avoid the risk of piling papers during your first few hectic weeks in business.
  

• Make sure windows and doors are secured with proper locks.

• Check that chairs are comfortable, preferably with rising seats, arms, adjustable backs and ideally swivelling with castors or runners.

• Choose a desk to suit the equipment you use. A computer, fax machine, telephone, filing trays, and so on, placed on a small desk will probably mean no working space for you. Solve this almost universal problem by having two desks, or a table and desk, arranged in an L-shape. Place the things you use most often on the desk where you normally work. There is now a wide variety of home office workstations which are fully mobile and can be moved from room to room. Others fit neatly into a corner with overhead storage for a computer screen and files.
  

The above text is Chapter One of The Smart Guide to Working From Home, which contains a futher five chapters:

Chapter 2: Homeworking: How to Find Genuine Work

Chapter 3: Business Basics

Chapter 4: How to Find Customers

Chapter 5: Finance and Insurance

Chapter 6: Sources of Help and Advice

Useful Addresses

Contact: info@homebusiness.org.uk

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