The Pro’s & Con’s of Running
a Home-based Business
SCC BUS 209_ HBB
You’re Not Alone
Estimates range between 18M to 38M
HBBs in the USA. Latest US Census
data computed says 13.8M, with 9.7M
being the household’s primary incomegenerating. According to IDC (nat’l
research firm), 34.3M to 36.6M in
Newsweek approximates that 50% of
all US households have some form of
Many of them make a lot of money,
total estimate $427B!
Do your research first to see if it is
right for you and your family
Why the Growth of Home-basers?
Access to Technology
Change of Professional
Image & Choice
You are your own Boss
You can schedule your own time
You can stay at home with the
Low overhead for the business
Eliminate corporate/ office politics
You can do the laundry as you
The dog won’t chew up the yard
Lack of self-discipline
You’ll be at home with kids
Don’t know when to shut it
Your family doesn’t truly
Little “tech” support
You’ll start talking to yourself
Loss of structure
Personal & Family Considerations
Loss of daily structure should not be
Self- discipline is a challenge
Isolation is a problem for most people
Organization is a family challenge
Separating Home from Work is hard
Family Issues will arise
The stigma of not being “professional”
My 5-year old
that this office
Examine & Prioritize the Pro’s and
Con’s: Ask Yourself the HARD questions.
Is it right for me now?
Do I have the
enough to do
Will my family
Can I tune it out or will
this be a 24/7 job?
CAN I MAKE MONEY?
More Hard Questions to Ask
• Is the business right
(appropriate) for the home?
• Is it legal?
• Are their local zoning
• Are their private or property
Check with your local city planning department
Normal zoning is one of four ways,
each with implications for the
Isn’t it always a TAX Advantage?
NO! Not Always
Claiming a depreciation
can subject you to
capital gains taxes when
you sell your home
Do your homework:
Contact the IRS and get
Business Use of Your
Do Not Overlook Insurance
• According to IIA of A 60% of
HBB’s lacked adequate
• HBB are not automatically
covered by regular
• Cover Your Assets!
The Approach: Getting Started
The entrepreneur approaches the
task by looking at their own skills &
abilities and then determining
which kind of business to
The entrepreneur looks first for
opportunities on the outside (in the
market)- “opportunity recognition”
Which Approach to Use?
• Inside Out
• Outside In
• Accidental (serendipity)
• All of the above?
Home based Businesses Special
American Association of Home Based
Businesses AAHBB (non-profit)
• National Association of Home Based
Home Office Association
SOHO (Small Office Home Office)
Local Chambers often have SOHO (Small
Office Home Office) or HBB committees
Your local SBA, SBDC & College