Small business owners are considered the backbone of the American economy. While these entrepreneurial people are undoubtedly important to the American lifestyle, the way these small businesses operate has shifted dramatically. Today, small business owners are less likely to operate a physical store. Instead, modern entrepreneurs are inclined to start a home-based business.
A home-based business is operated out of a private residence. This has become increasingly possible due to the Internet. As people are able to sell things remotely to a wider range of people, home-based businesses have found an important place in the American economy. Despite the fact that many Americans are pursuing this type of business, there are many misconceptions regarding what these businesses are all about. In order to better understand the changing business landscape, consider these seven facts.
1. Home-based businesses are countrywide. The fact that home-based businesses are operated out of basements, kitchens and home offices means that anyone, anywhere can create one. In the current marketplace, people in all parts of the country have taken that to heart. In the United States, there are more than 38 million businesses operated out of private homes. This encompasses homes in all states. It includes people who live in big cities, and it also includes individuals from rural communities. These businesses are as varied as Americans themselves.
2. Home-based businesses are diverse. Businesses operated out of the home are as different as the people who run them. Some people market their services as a freelance contractor, developing a LLC out of their home office. Other people become a merchant of third party goods, establishing an Amazon Seller or Ebay account to master the online marketplace. More traditional options such as catering or party planning are also great home-based opportunities. The current marketplace supports all such business ideas, and new endeavors are successfully launched daily.
3. Home-based businesses are profitable. People who have never worked in the industry may think that most home-based businesses are barely turning a profit. While it is true that some are more successful than others, there is no evidence that home-based opportunities are less viable than more traditional ventures. Some data suggests that home-based businesses earn $427 billion in annual revenue. More impressively, around 20 percent of these businesses net more than $100,000 each year. This price point outpaces many more traditional business opportunities. However, these high figures should be taken in context. Home-based business owners are usually working without any benefits, which means they are on the hook for their own health care. This does dip into their profits, but the numbers still suggest that home-based businesses are a legitimate way to make a full income.
4. Home-based businesses are enduring. There is a notion that home-based businesses are poorly thought out, haphazardly operated and likely to fail. Obviously, some home businesses probably fit this profile, but you should remember that this is true of all businesses. There is no evidence that home businesses are more likely to fail quickly than other businesses. In fact, 70 percent of home-based businesses are still profitable within three years. This is compared to only 30 percent of traditional businesses. With this data, it is clear that home-based businesses have the potential to be successful for the long haul. This success can be linked to the low operating costs of home-based businesses and the potential to market around the world via the Internet.
5. Home-based businesses are affordable. All businesses require some money to get started. This initial investment can be an impediment for some people, which is why home-based alternatives have become so popular. Home-based businesses usually do not require as much cash to get started. This is because there is no building or other traditional facilities. Many of them use a virtual business address as their business address. Therefore, most home-based businesses can be started for less than $5,000. This means that more people can achieve their dream of operating a small business, and it also means that most home-based business owners start with more capital to use for other business needs.
6. Home-based businesses are enticing. It is estimated that 70 percent of Americans prefer to work for themselves. For people who want to be their own boss, the current marketplace has never made it easier. Thanks to the Internet, home-based business opportunities are more accessible than ever. This means that more people are embracing the entrepreneurial lifestyle. Moreover, it means that more people are succeeding in said lifestyle.
7. Home-based businesses are great for gender equality. Despite advancements, some women struggled to gain equal footing in the marketplace. This may be why more and more women are turning to home-based opportunities instead. In fact, some data suggests that women are more likely to pursue a home-based business. Overall, 72 percent of women who open a small business do so out of their home. This compares to 53 percent of men. These women may choose home-based businesses because they require less capital. They may also choose to work from home in order to balance other family commitments. Whatever the case may be, home-based businesses are a great way for women to increase their earning potential and enjoy a fulfilling career.
Clearly, home-based businesses are an important part of the American economy, and they are a critical element in America’s shifting culture. By embracing the home-based business model, you will be able to pursue your dreams and make money in the process.