Starting and Managing a Business Idea From Your Home
by Lynne Waymon
Produced in cooperation with the American Association of
Community and Junior Colleges
Charles Liner, SBA Contracting Officer's Technical Representative
Judy Nye, Project Director, AACJC
Martha McKemie, Senior Writer-Editor, SBA
Eugene Donaldson, Graphics, SBA
About the Author
Lynne Waymon designs and delivers continuing education programs in the
fields of small business management, management skills, and personal
development. She has worked with private corporations, government agencies,
and community groups to develop courses specially designed for their
employees. Programs under her direction at Montgomery College in Maryland
received awards from the Small Business Administration for "outstanding
performance providing consistently high quality business management
training of substantive value to the small business community" in 1978 and
in 1982.
Introduction: "There's No Place Like Home"
The cottage industry, an old-fashioned enterprise, is enjoying a revival so
strong that it's difficult to find out just how many Americans are now
working at home. Estimates range from two to five million and the numbers
may double by 1990.
Because women now enter business at a rate five times faster than men, the
trend of operating from home is growing. A natural starting place for many
businesses seems to be the garage, basement, or den. A recent Census Bureau
study showed that over 300,000 women's businesses are operated out of the
home.
Homemakers, hobbyists, retirees, people interested in a second income, and
the disabled are just a few of the groups attracted to home enterprises. A
young mother's craft business began when she started appliquéing
decorations on her children's clothes. A retired government worker bought
36 beehives and sold honey to local health food stores and at craft fairs.
A teacher did typing and secretarial jobs for her husband and friends until
she realized the potential market and opened a full-time secretarial
service from her apartment. Others have become home business owners by
using their skills in catering, counseling, teaching, day care, sewing,
writing, photography, consulting, market research, and landscape design.
The list of services that have been successfully operated from home is
endless: chimney sweeping, maid services, messenger services, wake-up and
answering services, home nursing, mail order businesses, party planning,
dog grooming, kitchen and closet planning and organizing, and others too
numerous to mention. As you explore the questions asked in the first
chapter, "Home Entrepreneurship: Is It For You," let your thoughts run
freely through the possibilities until you can target exactly the right
type of business for your skills, your home space, your market, and your
part of the country.
Home Entrepreneurship: Is It For You?
The first step in deciding whether to start a business idea is to ask yourself
this important question: "Do I have what it takes to be an entrepreneur?"
Studying the characteristics of successful business owners will help you to
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tell whether your personality traits, experiences, and values are similar
to those who have succeeded. And assessing your experience, skills, and
life goals will also help you decide if you want to invest the energy,
time, and resources that successful entrepreneurship requires.
Who is the "Typical" Entrepreneur?
What makes an entrepreneur successful is a hotly debated and vigorously
researched subject. In Success And Survival In The Family-Owned Business,
Pat B. Alcorn, an expert on entrepreneurial problems, has developed the
following questionnaire to help you determine your "Entrepreneurial
Quotient." Write your answers in the margin. Then read on to discover what
she believes characterizes the typical entrepreneur:
Do you reconcile your bank account as soon as the monthly statement comes
in?
Entrepreneurs are careful about money. They usually know how much money
they have so they can seize opportunities on short notice. They know what
things cost, whether prices are going up or down, and whether they are
getting a bargain.
Did you earn money on your own from some source other than your family
before you were 10 years old?
Most people who are going to make money in business show an affinity for
making money at an early age--by babysitting, selling lemonade, delivering
newspapers, or some such strategy.
Do you get up early in the morning and find yourself at work before others
are out of bed?
Entrepreneurs sleep and eat enough to keep up their strength, but they don't
usually tarry at these pursuits.
Do you tend to trust your hunches rather than wait until you have a lot of
information on hand?
Hunches are judgments based on factors that cannot be quantified, a big part
of entrepreneurship seems to be risk-taking based on these hunches.
Do you keep new ideas in your head instead of writing them down?
Entrepreneurs keep a lot of things in their heads, including their most
creative ideas.
Do you remember people's names and faces well?
Ease in remembering names and faces is very important in the business world.
Were you good in "hard" subjects--mathematics, biology, engineering,
accounting, and so forth--in school?
People who major in business administration in college are more likely to
be successful entrepreneurs than anyone else. They prefer subjects in which
the answers are conclusive rather than open-ended conclusions full of
contingencies.
In school, did you pretty much stay away from such organizations as Scouts
and student government?
Most entrepreneurs tend to be loners rather than joiners, unless joining is
a useful tactic for making contacts and gathering business information.
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In courting the opposite sex, did you tend to go for one person at a time
as opposed to playing the field?
Most entrepreneurs preferred one person because to play the field would have
taken too much time away from business activities.
Do you close deals with a handshake rather than insisting on written
contracts and guarantees?
Good entrepreneurs are often comfortable with something less binding than
written contracts. When the only bond is a word, it becomes a matter of
honor, and no entrepreneur can afford to lose honor.
Do you devote considerably more time and thought to work than to other
activities, such as hobbies?
Entrepreneurs may have some leisure time activities, but their principal
hobby is their work.
A similar test was developed by John Komives, director of Milwaukee's
Center for Venture Management. Again, write your answers in the margin,
then read on to see the expert's answers
Was your parent an entrepreneur?
Having a close relative who was an entrepreneur is the single most telling
indicator of a successful entrepreneur.
Are you an immigrant?
There is a high correlation between immigrants and entrepreneurs. In this
sense, "immigrant" includes not only those who were born outside the United
States, but also those who moved from farm to city or from the Midwest to
the West Coast.
Did you have a paper route?
The entrepreneurial streak shows up early in life.
Were you a good student?
Typical entrepreneurs were anything but model students and often were
expelled from school.
Do you have a favorite spectator sport?
The best answer is "no." Entrepreneurs are poor spectators. They often
excel at individual, fast-paced sports such as skiing or sailing.
What size company do you now work for?
The typical entrepreneur comes from a medium-sized company--30 to 500
employees.
Have you ever been fired?
Entrepreneurs make poor employees. That's why they become entrepreneurs.
If you had a new business going, would you play your cards close to the
vest, or would you be willing to discuss problems with your employees?
Typical entrepreneurs have a secretive streak. If they confide in anyone,
it is likely to be another entrepreneur.
Distributing Home Business Ideas And Help People to Start Their Own Business Idea With Opportunities
They Might Have Gives Us Great Pleasure.
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