Debt Free

The age in which we live has been equated by some to the gold rush days of the 1840's and 1890's. Never before has it been possible to so easily find and take advantage of a home business opportunity. Thanks to the Internet, such opportunities are strewn about like so many grains of sand on a beach. The different types of home business opportunity are almost as varied as the number of them out there, waiting for you to jump in and pan for your fortune. One insurance industry survey in 2002 found there are approximately 12 million home businesses in the U.S., so you'll have plenty of company.

Like the gold rush days of yore however, many of the would be entrepreneurs grabbing at the golden ring of home business are destined to come away with little or nothing. There are a myriad of reasons for this. Some of the most common reasons for home business failure are these:

1 - Lack of focus – Too many home business entrepreneurs get awed by the multitude of different opportunities available to them. They try to get involved in too many different ones, never focusing on one specific business. This occurs more often in home business than a more traditional bricks and mortar business. This is often attributable to cause #2 of home business failure, below.

2 - No business plan – Your business plan is a necessity for a multitude of reasons. It helps you to plan for eventualities and have a strategy for dealing with them so you can be proactive, rather than the more common scenario of reacting to situations. At the startup phase, a solid business plan will help you cover all the details that make a home business (or any other business for that matter) successful. It's easy to overlook something and a business plan will help keep that from occurring. If you're seeking outside financing, the financiers will want to see a solid business plan to help gage your commitment and chances of success. Depending upon their level of involvement, they can offer suggestions based upon your plan that may improve aspects of your home business.

You'll need to address all aspects of your business in your plan; you must choose a legal business structure (either a sole proprietor, partnership, S-corp, C-corp), decide how you'll be making money, lay out a financial and marketing plan, and define the businesses key personnel, their experience and their positions in your home business. It's okay if that's only you, your spouse and your uncle Earl right now.

3 - Treating your home business as a hobby, rather than a real business. This leads to a failure to apply solid business principles and methods. You need a real accounting system for example, not a shoe box in which to store your cash and scraps of paper to use as a journal.

4 – Ineffective marketing strategy and/or implementation. Many who try a home business opportunity have no real business or marketing experience, have never studied marketing and don't really have an idea how to market their product and/or services. This is why some entrepreneurs choose to investigate one of the many franchise opportunities. The advantage here is that the marketing plan is well laid out and has been followed successfully before. In addition, most franchisers offer marketing assistance. The disadvantage to franchise opportunities are high start up costs and relative lack of freedom. Some home business entrepreneurs are seeking freedom after careers in a large, corporate environment. With a franchise, you'll be required to adhere closely to a set business plan. That's both a blessing and a curse for those individuals.

5 – Never really getting started. Too many entrepreneurs fail because they never seize the initiative. They piddle around, and before they know it, they've condemned themselves to failure in their home business.

6 – The most common reason for failing in a home business opportunity – Lack of persistence! You've got to stick with it, often in the face of daunting adversity. Many successful entrepreneurs have failed multiple times, on multiple levels, before experiencing their first taste of business success. Expect that you may experience some bumps along your road to success as well. The key is to never quit and to make the adjustments to your business that are necessary to ensure your success. Countless successful business owners can attest to that.

If you're trying to get debt free and stay that way, a home business opportunity may provide the vehicle in which you can travel. In many cases however, you'll accumulate substantial debt, especially during the start up phase. Different home businesses will require different levels of financial commitment. The level to which you are willing or able to make a financial commitment will be one of the determining factors that will help you decide the right home business opportunity to pursue. Some on-line business for example can be started with little more than a credit card and a hundred dollar limit, while another home business opportunity, such as a franchise, may require hundreds of thousands of dollars in start up capital.