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Ask CJ: Exploring the brave new world of home-based business

If you think back not even 20 years about home-based businesses, you might envision a low-tech service business such as a daycare or landscaping company. To run a professional business, you needed to be located in commercial office space. Not only did commercial space provide the technical services you needed, but it also provided a professional atmosphere appropriate for meeting with clients.

Today, that is no longer the case. Many small, predominately service-related businesses are home-based and are able to perform the same functions that once were restricted to commercial space. There are some obvious advantages and some resources available that make the home-based business a good choice for the right person.

Before you decide to open up shop from your home, a serious self-examination should take place, and there are several questions you need to ask yourself. “Do I have the discipline to maintain a focus on my business if it is run out of my house? Is there an adequate space in my home that can be used as an office? Are there distractions that will pull me away from my business focus? Will family and friends respect my work time?”

These might seem like obvious questions, but if you can’t separate home from business while working out of the house, you won’t be successful.

With the incredible advances in technology over the past two decades, you can run a small business from your home with the same access to high-speed Internet that you get at many offices. What you may not have is a professional space for client meetings, which raises several considerations: How many of your interactions will be face-to-face? Is it expected that you will go to their place of business or do they need to come to you? What image do you want to portray?

For example, if you are bringing major clients to your home to showcase your engineering capabilities, will they hesitate or question your business acumen if the meeting takes place in your garage? This hurdle can be overcome by using fee-based conference space, such as that offered by I.O.S. in Portsmouth. Conference rooms can be rented for an hour or the day. This is a great resource for someone who can do most of their work from home but who occasionally needs a professional setting for meetings and presentations.

A home-based business can provide a great cost-savings, as you not only save by not paying commercial rent, but the space devoted to business purposes can be used as a tax deduction. A portion of the utilities can also be factored in as tax deductions, but they have to be in proportion to the size of your office space. You may want to have an accountant assist with this because it can become an issue with the IRS if done improperly.

Dianne Durkin, president of Loyalty Factor in Portsmouth, started her company 16 years ago with the express intent of keeping it based out of her home. She likes the home-based environment because, “I can be creative and innovative at any time with all the resources available to me whenever I need them.” For instance, she may wake up in the middle of the night inspired by an idea and being home-based means she doesn’t have to wait until typical business hours to flesh it out. Dianne often puts in some office hours over the weekend, but she says that when she is done for the day, she closes the doors to her office to help create the separation between home and workplace.

Loyalty Factor has four employees, including Dianne. One staff person splits hours between home and Dianne’s place, another works full time at Dianne’s home, and the third employee works part time at the business. Dianne and her employees dress professionally at the office, as they would in any other business setting. Asked about misconceptions of having a home-based business, Dianne said, “You won’t find home-based professionals working in their pajamas all day from a dining room table. It just isn’t conducive to productivity.”

There goes my dream.

Whether you have been in business for 20 years or are just getting started, we have the resources and the expertise to answer your questions. You can e-mail me at Christine.Davis@dred.state.nh.us. I look forward to hearing from you.

Christine J. Davis works for the N.H. Division of Economic Development as a resource specialist serving businesses in Rockingham and Strafford counties. Her role is to provide the support needed for businesses so that they may remain viable and growing entities in the community. Davis lives in Exeter with her two daughters.

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