10 Key Things to Look for When Choosing a Home-Based Business

Here are some statistics I’ve gathered from the NBBTA (National Black Business Trade Association) and the SBA (Small Business Association).

Rather than try to recreate or summarize the information, I’ve simply copied the information from their website. There’s some pretty powerful stuff here!

Here are some interesting Jeopardy®-type answers from these same websites (remember these, you may need them some day!):

WOW! This is definitely the right time and the right place for you to explore getting started in your own home-based business.

However, even though this is exciting, it’s also overwhelming (even baffling and frustrating!). As I’m sure you’re aware, there are a plethora of home-based business opportunities available, each claiming to provide you THE pathway to financial independence where you can live the life of your dreams.

You can get into everything from your own home-based travel business, to online stores, to designing websites for others, to network marketing companies, selling phone services, data-processing and data entry, marketing low APR credit cards, buying real estate for nothing down, different programs of stock market investing, buying and selling mortgage notes, to filing out legal briefs, to________________. (fill in the blank!)

What have you heard about (or tried!)? I must confess that I’ve tried at least five of these options listed above and several others not listed. Some have been good. Others were a huge disappointment and waste of my time and money.

So how do we sort through all of the “opportunities” to separate the wheat from the chaff”? I’ve developed a screening system involving 10 key factors which I use myself and I teach them to my business partners and clients whom I coach. It’s not an exhaustive list by any means, but it’s a start.

Check out when they got started. What has their growth been since their start? How does this compare with the industry of which they are a part?

History shows that those who were first able to identity those trends and found ways to meet the needs of those trends, were able to create huge profits for themselves and others involved with them. They were able to get in front of the huge economic wave and ride it to financial freedom!

Just think about what it would have meant for you if you had been “riding the wave” of these trends:

This creates a continual stream of customers who are reordering your product(s). If you’re selling something like vacuum cleaners or camcorders, you’ll make some good money on the initial, front-end sale, but the likelihood of reorders is pretty remote, at least in the near future.

Is it a publicly traded company? This is another strong indicator of its financial viability (although by no means the only such indicator). A publicly traded company is heavily regulated in how it conducts it’s business. They also have stockholders and a board of directors which holds them accountable.

While I’m not able to share the initial business investment specifics of any home business but my own, I can assure you that it’s significantly lower than the figures above! Typically this ranges from $199 - $2600 depending on your goals and what you want out of your business.

There will always be some start-up costs as well which typically are between $200- $500. This includes getting yourself set up with key tools needed to run a business from home such as a merchant account (so you can process credit card payments), printing business cards and stationery, additional equipment needs (phone, fax machine, photocopy, etc.), and any business licenses or documents that may be required by your state or province.

Again compare this with the"total additional costs" in McDonald's® example above.

A company that primarily relies on your “warm market” (family and friends) has VERY limited potential for growth. After all, once you’ve “hit up” all of these people, where do you go next?

If the company does not have a system which BRINGS TO YOU leads or prospects who are serious about and want your products and business opportunity, it’s going to be next to impossible to grow grow your business at a rate that will make the kind of money you’re likely looking for from your business.

Also beware of the many varieties of “cold call” approaches - hitting up strangers in shopping malls, phoning “opportunity leads” you purchase (which have often already been sold to 17 other people!) and any forms of random contacting people who have not already indicated an interest in what you have to offer.

The marketing system should bring highly qualified leads to you, who are excited about your products and opportunity, AND who really want to talk to you! If you’re having to convince them of the value of what you’re offering or forcing them to talk with you, you’ve already lost!!

A person’s success totally depends on their own motivation, skills, commitment, and work ethic. This is true with ANYTHING in life: getting an education, succeeding in a marriage, raising children, etc.

Nevertheless, every business has gauges whereby they monitor and forecast their success. It’s all about the numbers – numbers of people who must be talked to make a sale.

They can also predict the success a new business partner can anticipate when all of other things mentioned above (motivation, skills, work ethic, etc.) are in place and if someone is serious, teachable, willing to work, and willing to follow the business building system the company has.

Study these then study yourself to see if you’re willing to do what it takes to succeed.

Part of what you’re paying for with your initial investment is a proven, step-by-step system. You don’t what to have to “reinvent the wheel”, so to speak.

You DO want to be able to copy others who have been successful in the business.

Now you will always want to tweak things a bit to make them your own and to give them your unique stamp so you stand out and people want to work with you, but you don’t want to have to create the basic business systems on your own.

This should already be in place so you can go to work and start making money immediately.

You should be able to map out over time, when you’re going to meet the income and/or lifestyle goals and dreams that made you purse a home-based business in the first place.

In a traditional job, you can more or less figure out your lifetime value: how much you’ll make during your employment (including raises and bonuses), what your retirement benefits will be (including social security, IRAs, 401K plans, etc.), and what interest on savings or investments you have are likely to produce. (This of course assumes that you’re not laid off and that your company will still be in business!)

It’s no different in a home-based business. You need to be clear on what CAN happen for you IF you are serious about your business and you truly work it as a business, not just a side hobby that you do when it’s convenient.

I got involved in my home business primarily because I wanted to build an early retirement for myself. I own a small training and consulting business, but I’m an independent consult. So my monthly income varies considerably. However you don’t retire on an income that’s up one month and down another.

I knew that what I needed was a business opportunity that would bring me significant passive residual income. I knew that, given my goal of an early retirement, I needed a business that , in a relatively short period of time, I could generate an income that did not rely on other people or my having to work everyday.

So when I was considering and trying different home-based businesses, this was always at the forefront of my deliberations; namely “Does this opportunity provide me with the potential to get what I want for my life and my family?”

VERY IMPORTANT: You MUST look beyond the hype, because they all claim to be the best opportunity since the invention of sliced bread. But it’s important you get your dreams and goals firmly in your mind, then ask “Can this business take me where I want to go?”, of course assuming I’m serious and willing do to the work.

One of the keys I always look for is who’s doing the training, coaching, and mentoring. Are they people who are themselves working the business and having success in the business?

I want my training, coaching, and mentoring to come from the trenches. I want people to share, from their own experience, what works and what doesn’t.

I don’t want theory. You shouldn’t either.

About the Author

David Lazear is a mentor, coach, and consultant for mentors, coaches, consultants, and trainers. He is an associate of Mike Klingler and Ann Sieg at the Renegade University and Renegade Professional. David has written some 15 books and created numerous resources for home business entrepreneurs, coaches, and consultants.

Contact David Here!
Phone: 773-525-6650

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