Ten Rules Of Business For Entrepreneurial Stay-At-Home Moms
By Sean C. Castrina, author of “8 Unbreakable Rules For Business Start-Up Success“
If you’re a stay-at-home mom, there are many good reasons why you might want to start your own small business: Maybe you want to kick in extra money to the family income. Maybe you want to flex your marketable skills, talents, or creativity. Or maybe you simply have a little extra time to fill now that your kids are older and at school during the day. However, if you’re like many women, you may be struggling to find a reason why you personally will be able to take your dreams from “concept” to “company.” I don’t know a lot about business, you may think. Would I really have enough time? What if I don’t make any money? Where do I even start?
Hopeful “mompreneurs,” relax and take a deep breath. Launching a home-based business is more doable than you may think as long as you know the right steps to take.
I believe without a doubt that a disciplined and motivated mother can start and operate a profitable business from home while raising children. It won’t happen overnight, but with planning and patience, you can lay a broad, solid foundation for long-term success as a self-employed businesswoman.
I speak with the voice of experience. A stay-at-home dad for six years, I cared for my daughter while building several businesses, including a six-figure direct mail business that operated in 23 different cities.
I made phone calls while my daughter was napping, and I did my paperwork and proposals during episodes of Barney or Mary-Kate & Ashley videos. Yes, a big purple dinosaur was my personal assistant, but it worked! Since I was my own boss, I had a lot of flexibility, and soon I had a business that ran like a well-oiled machine.
It’s easier now than ever before to launch a home-based company. Thanks to Internet-based tools, you can reach a large number of potential customers without ever leaving your house — not to mention the 24/7 access to educational tools and the ability to instantly search for answers to your questions.
If you’re ready to start your transformation from “mom” to “mompreneur,” read on for my top ten rules of business for stay-at-home moms:
1. Figure out your field.
Perhaps you already have a clearly defined vision for your business: you’d like to design, make, and sell original pottery, or you’d like to use your degree in accountancy to start your own tax service. However, it’s very possible that you’re one of many hopeful mompreneurs who isn’t sure which field to go into. In that case, I recommend starting a service business (anything from home cleaning to tutoring to adult care) for the following reasons:
• They require minimal money to start. “I’ve never started a service business with more than $10k, and many with less than $3k — including businesses that have made me millions!
• Many service businesses don’t require a prior work history or particular qualifications.
• In most cases, they can’t be outsourced or performed by computers so you’ll always have work.
• Since you can hire others to perform the actual work while you handle the key behind-the-scenes management tasks (like hiring, supervising, taking client calls, marketing, etc.), service businesses are a great source of passive income.
Entrepreneur.com has a great list of service businesses to start you thinking. Or you might also want to visit www.newbizcoach.org for more resources. Once you’ve familiarized yourself with the possibilities and identified a few that might be needed in your area, try to poll at least 50 people to see which services they would use in the next six months, and if they’d pay the price you would charge. Their answers will give you a good idea of which field you should go into.
Also, before pulling the trigger on your business, take time to research the licenses, permits, and certifications you may need for the industry you’re entering, and make sure that obtaining them won’t be prohibitive. You can usually find the information you need at your local business tax office or by contacting your Chamber of Commerce. And take it from the voice of experience: Start filling out that paperwork early. Government bureaucracies can be painfully slow!
2. Set aside a workspace.
When you’re working from home — a place that’s full of distractions ranging from laundry baskets to televisions — setting up a dedicated workspace is crucial for productivity. Depending on your home’s layout and how accessible you do or don’t need to be based on your kids’ ages, you might be able to use a spare bedroom, a basement, a detached garage, or even a nook in the living room as your “office.”
Personally, I converted our dining room into an incredible home office. I was able to do this on a dime because the room was already equipped with a large but seldom-used table. If you go this route, you might want to add a file cabinet and swap the chandelier for recessed or track lighting. (As I found out, it’s hard to tap into your entrepreneur mojo when you’re constantly ducking a chandelier!) Best of all, I was still in a central location where I could keep an eye on my daughter while I worked.
3. Create a dream board.
While you’re still in the planning stages, set aside an hour to tap into your creative side. Envision your goals for your business: what you’ll make or sell, who your customers will be, and — most importantly — how being an entrepreneur will positively impact your family and your future. Then glue images and words that remind you of those things to a piece of cardboard or poster board, and make sure the dream board is visible in your workspace.
Dream boards may seem small, but they’re very important. On those inevitable days when you think you must be crazy for starting a business while you’re already handling the toughest job on the planet, looking at photos of the vacation destination you want to visit, the logo of the college your child will attend, or your debt-reduction schedule will motivate you and remind you why you became an entrepreneur in the first place.
4. Get real about pricing.
When you’re just starting out, you may be tempted to offer rock-bottom prices for your goods or services. After all, you don’t want to alienate potential customers by charging too much… and isn’t underselling the competition a reliable strategy? Well, maybe — but that’s not the way to make a profit. Especially when you’re just starting out, you can’t be in the business of offering mega-discounts. If you recoup only enough money to pay labor and operating costs, you may be helping to feed your employee(s)’ family, but not your own.
A good rule of thumb is to charge prices that will net you at least twice what your labor and operating costs would be. When determining pricing, estimate fewer jobs or sales than you expect to have. For example, say your monthly operating costs are $800, you need to pay an employee $15 an hour, and you expect to do a minimum of 40 one-hour jobs a month. Together, your operating and labor costs are $1,400. So in order to make $2,800 total a month (which, remember, is before taxes), you’d need to charge $70 per job.
5. Make room for a marketing budget.
One of the biggest mistakes new business owners make is not including a marketing budget in their operating costs. In a nutshell, this is the money you invest every week or month to tell your community why they need your product or service, and why your company is the one they should choose.
If you do not reach and retain customers, you won’t be in business — you’ll be bankrupt. First, figure out what makes your business unique: what it offers, why people need your product or service, and why consumers should choose your company over any other. This is called your ‘unique selling proposition.’ Use all or part of it to create taglines, logos, marketing messages, etc. that will enable you to advertise through websites, social media, newspapers, fliers, etc. Then do a little research to estimate how much these types of advertising might cost so that you can budget for them.
6. Hire smart.
If your business will need one or more employees other than yourself (this is especially likely if you’re starting a service business), be aware that how and whom you hire will affect how successful your business is. Before you even think about placing your first employment ads, get familiar with federal, state, and local labor laws (these cover areas like hiring discrimination, child labor, independent contractors, immigration law, and more). Don’t worry; you don’t need to navigate these areas on your own. If you become a member of the National Federation of Independent Business (NFIB), you’ll have free access to its labor law hotline. You can also consult with an attorney.
Once you’re familiar with all applicable hiring laws, it’s time to get the ball rolling. First, I recommend making sure that you can get the labor you need before you officially open your doors by running test ads. If you don’t get five applicants within three days, you might want to rethink which field you’re going into, because you want to run a business that is effortless to hire for. At this stage, if you like, you can hire respondents as subcontractors (not official employees) who work when you have jobs for them—after thoroughly vetting them, of course. Once your business becomes more popular, you can consider hiring your subcontractors full-time.
When you do reach the full-time hiring stage, make it your mission to look for talented, smart, experienced, and competent people with integrity. Don’t automatically hire friends and family members because it’s convenient! Remember, experience, competence, and commitment are invaluable assets.
7. Buy some online real estate.
Many would-be small business owners (especially those who plan to do all of their business locally) figure that traditional print or radio advertising will be enough to spread the word about their companies. That’s archaic thinking. Since most of your prospective customers — even those born during the heyday of newspaper and radio—are surfing the Internet, websites are no longer optional.
Developing an online presence is as essential as having a business card. At minimum, you need a homepage that functions as a business storefront, conveying your unique selling proposition, pricing, and contact information—though sections for customer testimonials, employee bios, and photos don’t hurt! Check out the competition’s websites to see what works and what doesn’t. If you can’t afford to hire a website designer, check into the growing number of DIY systems that allow you to plug your specific information into cheap built-in templates.
8. Focus on providing great service.
After your business opens its doors, it will develop a reputation. Whether it’s a good or bad one is largely up to you. To make sure that customers hold your company in high esteem, focus on providing great service to each and every customer from day one. Word of mouth is important for the growth of any business.
What ‘great service’ looks like, of course, will depend on your field. Let’s use a lawn mowing company as an example. To show that your company does the little things that big companies won’t, you decide that your employees will pick weeds out of flowerbeds for no extra charge. In this scenario, I would recommend giving each client a postcard printed with two boxes (labeled ‘lawn mowed’ and ‘flowerbeds weeded’) for each visit. At the end of the job, your employee would be required to check each box. Not only does this make sure your employee does the work — it also shows the customer how important this ‘extra’ weeding service is to you.
Another aspect of providing great service is putting quality control measures in place. In other words, make sure your customers get what they pay for. Be prepared to listen to the occasional complaint and to rectify the problem. It’s also a good idea to periodically survey customers to make sure that they’re satisfied with the goods or services you’re providing and to see if they have any ideas for how you can improve.
9. Take advantage of cost-saving opportunities.
Since you’ll be using your home as your exclusive place of work, you can save a lot of money compared to entrepreneurs who are based in a more public space. Besides enjoying obvious money-savers like not needing to pay rent on and equip an office or shop space, purchase a professional wardrobe, or spend time and money on a commute, you can — and should — be proactive about using your business’s location to reduce operating costs.
One of the main ways you can do this is to capitalize on tax deduction advantages. For example, if you set aside a separate room of your house in which to conduct your business and/or store products, you may be able to take a home office deduction. You can also write off transportation expenses to and from your home to your business appointments, and in some cases, expenses related to car maintenance and repair. Remember, lack of capital is the number one reason why businesses fail. Every dollar counts!
10. Use your time wisely.
Good time management is an important skill for any entrepreneur to have, but it’s especially crucial for stay-at-home moms, who are splitting their time between taking care of children and building a business. Wasted time has been the downfall of many mom-run businesses, because if you’re forced to choose between spending your last hour on your children or your business, caring for children must come first.
Whenever possible, I recommend planning each day the night before. Write down all of the things — family and business related — that you’d like to do the next day. Then, mark each one with an A, B, or C. As are tasks that must be done. Bs should be done, and Cs would be nice to get around to. This system will help ensure that you’re spending your time on high-value activities instead of responding reactively to every shiny ball that rolls by.
While these rules don’t cover every step of creating your own business as a stay-at-home mom, they will help you to head in the right direction. So stop procrastinating. If you have a good idea for a business or want to start earning more money, there’s no time like the present to join the ranks of successful mompreneurs.
Sean C. Castrina is the author of “8 Unbreakable Rules For Business Start-Up Success“ and the soon-to-be-released 8 Unbreakable Rules for Small Business Dominance. He is also founder of newbizcoach.org. A successful business coach and a true entrepreneur, he has started over 15 successful companies over the last 18 years. His companies have ranged from retail, direct mail marketing, and advertising to real estate development and home services.
This is an article contributed to Young Upstarts and published or republished here with permission. All rights of this work belong to the authors named in the article above.