How to start a business at home

Running a business at home can be a great way to work around family commitments or gain a second income.

Starting a business from home can be a great way to be your own boss and means you can structure your work around your lifestyle.

A home business gives you independence and satisfaction from completing your own work and you can start small then grow your business at your own pace.

And, if things don't work out, you haven't incurred lots of costs such as leasing office space.

Why is starting a business from home a good idea?

Starting a business from home gives you greater flexibility and freedom and you can choose what work you take on as well as set working hours that best suit you and any family commitments.

You can set up a home business as a part-time job alongside your full-time job, so you don't lose income from being employed, and expand your home business into a full-time job when you wish.

By being your own boss you can hire family members and friends.

And, with no commuting to a workplace and no dress code, it makes for a better working environment if you don't thrive in an office environment.

Working at home also saves money, as you don't need to pay for rent or utilities, and makes sense if you've limited start up funds or when initial cash flow is unpredictable.

Running a business from home needs little investment and you can often save more with tax benefits.

What are the disadvantages of running a business from home?

Setting up a business at home means that you'll be taking on a number of roles including home office administration, stock and inventory control, IT support, bookkeeping and marketing.

Without other staff to help, you'll be responsible for every aspect of your business.

A home environment isn't usually as ideal as an office or workshop for working.

When working at home there can be many distractions - such as childcare, TV and readily available snacks - taking your attention away from running your new business.

Separating home from work life while under the same roof can lead to increased stress as family demands and the blurring of work and home boundaries make it hard to isolate yourself to work on business matters.

Conversely working at home can be isolating and lonely without co-workers, with contact limited to email and phone calls.

Tips for running a business from home

If you've decided that you want to run a home business there are some useful tips to adopt that will make running a business from home easier.

Whether it's being disciplined about when and where you work from home, to spending time creating a productive working environment, investing in a good home working set up will help give your home business more chance of success.

Agree how much time you'll spend running a business from home

Define the amount of time you'll spend working at home.

This is especially necessary if you have a regular job as well as family commitments.

Agree how much time you'll spend each week - stick to this, ensuring family issues are dealt with outside of home working hours, and that you stop working when you've reached the defined amount of time.

Ensure you manage your time well and establish a set time where you plan to work and must not be disturbed.

Create a dedicated space to work from home

Set aside a quiet workspace that's separate to your home life to minimise distractions.

Furnish it with office furniture to differentiate from your living space and create a productive working environment.

Invest in a good office chair with lumbar back support and desk if your business involves long hours sitting at a desk as poor quality can result in back or wrist injury.

If you're starting an online business buy a decent computer or laptop - these can be claimed back as business expenses.

You may want to consider setting up a PO Box or an alternative telephone number rather than using your home address.

A 0875 or 0870 number are cheap to purchase and prevent people calling your home phone or mobile.

You could also buy a dedicated business mobile phone.

Check any legal and financial requirements

Depending on the business you want to run from home you'll need to inform your local council, mortgage provider or landlord and your insurance company that you're starting a business from your home.

You will need to perform health and safety evaluations if you're planning to have clients come to your house.

You'll need to research the financial and legal aspects of starting a business, and be aware of the tax and National Insurance contributions you'll need to pay.

If starting a business in childcare you will need to be DBS checked and may have to meet the Ofsted childcare criteria.

You can register as a childminder with HMRC.

You can also contact HMRC to pay correct income tax and national insurance.

If customers come to your home, insurance is important to avoid liability if one of your clients hurts themselves or breaks something in your home.

Advertising and marketing

Without a shop front to attract customers, marketing and advertising your home-based business is vital.

Don't just rely on word of mouth.

Build a website, hand out business cards and flyers and put up posters around your local area.

As a starting business your initial customers will most likely be local so it's important to advertise in your local area.

Ten businesses you can run from home

1. Childminding

Many parents will pay for someone look after their children, whether it's after school while they work or in the evening.

You'll need to be DBS checked and if looking after children at your home, you'll need to inform the council, perform health and safety checks and childproof your home.

2. Selling cosmetics

This is a very social job that focuses on networking.

You don't need specialist equipment to sell cosmetics but you may want to consider storage space to hold products.

Companies such as MaryKay and Avon offer opportunities to become a beauty representative.

3. Handyman or gardening services

If you're skilled at DIY, people are willing to hire you for basic repair and garden jobs such as assembling furniture, plumbing, cutting down trees or planting and cultivating a vegetable garden.

You'll need good quality tools and legal qualifications for gas, construction and electrical work.

Research sites such as Checkatrade to see other local handyman and gardening services to find out what they offer and how much they charge.

4. Dog walking

If you like dogs and have a few spare hours during the day, dog walking can be a great idea to make money and get exercise.

A dog walking business requires very little investment or equipment.

5. Selling products

Whether it's handmade jewellery, homemade cakes, soap products or greeting cards, selling products can be a great side income.

You can sell at fairs or websites such as Etsy or approach larger stores who may sell your products for you.

6. Web design

Many businesses, particularly small ones with small budgets, need people to design and maintain their websites.

Online resources such as Alison.com offer free online courses for web designers.

You'll also need to invest in a computer but lots of good web design software is free to download and use. TechRadar has a list of some of the best free web design software.

7. Tutoring

If you excel in a particular subject and are a good communicator you can earn money by tutoring children or adults.

You can do this at your home, the client's home or even online via Skype.

Tutoring generally falls in several areas: musical instruments, for specific exams, languages and general tutoring to improve mathematics and English.

The Tutor Web Site has a guide for how to get started as a tutor.

8. Writing and proof-reading

Many businesses require content for magazines or websites.

Being a freelance writer means you can write in the comfort of your own home when you want.

If you're talented at researching content and writing articles this could be a great business for you.

This is a low investment business; all you need to be freelance writer is a laptop or computer and good research skills.

9. Outsourced jobs

Small businesses often outsource jobs like accounting, PR or marketing as it's cheaper and easier than employing someone or doing it themselves.

You may need previous experience to do work such as PR but if have these skills from your career to draw on then consulting in these areas can be very profitable.

10. Hair and beauty services

Many people set up hair and beauty salons in their own home.

There is a wide array of beauty services you can offer from cutting hair, painting nails, and fake tanning.

Start at home to build your customer base and if your business grows you can then look to expand and purchase premises.

You can also make the service mobile and visit people in their own homes.