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Before You Do Anything: Try It
Out
So you know, roughly, what you want your home business to be.
Before you go any further and start investing, though, you need
to try it out. Here's how.
Build a Prototype
If you plan to sell physical things, or you're going to do
something like starting a website or making software, then you
should build a prototype to see how your idea will work out. A
prototype is a version of your product that is built quickly by
you alone, and serves to show that your idea is feasible in the
real world. If it would be too expensive to build the whole
thing, then just building the new part that differentiates you
from your competitors is good enough.
Show your prototype to a few people, to see what they think.
Are they excited? Would they use it?
Get a Few Customers
If your product is relatively low-value, or you're providing a
service, then it shouldn't be too much trouble to get a few
customers and do a few dry runs. Do them a generous discount
(you could even do it for free), to make sure that everything
runs smoothly and the customers are satisfied at the end of
it.
For example, let's say you plan to be a landscape gardener from
home. You could borrow the tools, and volunteer to do a garden
for some kind of charity project - this is good, since it means
that you're doing something nice for charity, but they're not
paying for perfection, so it's not that bad if small things go
wrong. You should then go through all the motions as you would
once your business is established, and see what comes out at
the other end.
Here's another one. Let's say you're an Italian living outside
Italy, and you plan to start a home business cooking pasta in
your kitchen and delivering it to customers (you'd be surprised
how many home businesses there are in the catering industry).
You could make a rough draft of a leaflet (with discounted
prices) and deliver it to a small number of homes in the area,
until you get a little response. You could then see if it
really is feasible to make and deliver these things, and
whether there would be any profit in it.
The best dry-runs, though, are the ones where you can get one
client at full price. This generally happens in the kind of
industry where most transactions are business-to-business, and
go through a bidding process. If you're doing something like
freelance writing or artwork, this can let you take on one
'job' without being committed to any more afterwards. If you
find it's not for you, at least you haven't lost too much - and
if you love it, then you're getting valuable experience before
you try to take it full-time.
When you try your business out, make sure to do some kind of
survey - you could hand it to the customer, include it with
your delivery, or even phone up and say that you're just
calling to make sure everything is alright. Following up this
way isn't just good for you, it's also good customer
service.
Don't Rely on Scale
One of the most common things I hear when I tell people to try
out their home business ideas is that a small-scale trial
wouldn't do the idea justice, since they 'plan to make money on
scale'.
Never, ever rely solely on scale. You think that supplies will
get magically cheaper if you're doing ten orders a day instead
of one? Guess again. You think you're going to save time by
doing lots of orders at once? You might save some, but not as
much as you might think. When you're trying to see whether your
business is viable, you should always err on the conservative
side - the thinner your margins are, the easier it is for
something unexpected to happen and destroy them altogether.
You're cheating yourself if you don't try out your business
before you start it - you'll be throwing yourself in at the
deep end, and there won't be a lifeguard. Trying it out gives
you the opportunity to make your beginner mistakes (there will
be a few, I guarantee it), and to build confidence in yourself
and your business without taking pointlessly large amounts of
risk.
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