Starting a Business From Home: 7 Essential Steps

1. Come up with a business idea

• Becoming a freelancer in an industry that allows you to take on work from multiple clients such as freelance writing, bookkeeping, graphic design, or web development.
• Raising ad revenue from online content, such as blogging, vlogging, podcast making, online courses, ebooks, reviews, or product comparison.
• Selling an app.
• Participate in the share economy such as renting your own car, or AirBnb.
• Upcycling or flipping products like cars, bikes, or furniture.
• Becoming a virtual assistant.

• Running an online store through a platform like Etsy selling items you’ve handcrafted.
• Selling imported or collectable items through platforms such as Ebay or Amazon.
• Consulting in an industry you’re familiar with.
• Participate in the share economy such as renting your own car, or AirBnb.
• Pet sitting or dog walking.
• Operating an at-home salon or spa (for hairdressers, massage therapists, and beauticians), yoga studio, family day-care, or regular music classes.

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2. Assess demand and profitability

• Is there a market for my idea?

  Will people be interested in what you have to offer? What is your target demographic? If it’s a niche idea, will you be able to take it internationally so as to maximise your potential market? If it’s not niche, consider whether the market is saturated and whether you need to go in a different direction, or hone in on what will distinguish you in the competitive marketplace.

• What’s my unique selling point?

  What will you do that will differentiate yourself from what everyone else in the market is doing? Can you put a unique spin on your business, or offer unique expertise? Can you offer better quality than what’s already out there? Or a lower price? Sometimes you are the unique selling point. For example, if you’re thinking of becoming a freelancer, your professional experience, expertise in a particular area, or your creative vision is what allows you to do work that nobody else could.

• What will it cost to offer my services or products?

  This is a good time to make some calculations, factoring in the cost of any tools or equipment you need to buy and raw materials. Don’t forget to factor in the costs of your labour as well!

• What can I charge or make for my services or products?

  Answering this question involves estimating costs and then adding a healthy profit margin on top. It also involves looking at comparable businesses and seeing what they’re charging. Decide whether you’re prepared to compete with that price point, or offer reasons why you’re charging more. Some business models – such as relying on ad revenue – won’t allow you to set prices. This means you’ll need to research what targets you’ll need to hit to make money, and how much you can expect to make. You can then decide if that amount sounds reasonable for the work you’re planning on putting in.

3. Determine whether it will work as a home-based business

• Allow you to stay at home and or work online

  Although you may need to travel for meetings, markets, and errands, a good at-home business shouldn’t require you to have a brick-and-mortar storefront, or rent specialty office space. Read more about starting an online business in Australia.

• Will have relatively low startup costs

  You always need to spend money to make money, but at-home businesses will allow you to make returns on your investments within a relatively short period of time.

• May allow you to earn passive income

  Passive income requires little effort to accumulate. You might write a single ebook, for example, and then allow the sales to come in without having to make new content; or if you use public transport, you could rent your car to others without having to change your regular routine or do much beyond the minimal car maintenance you’d do anyway.

• Won’t take over your whole house

  Work at home can be contained to a home office, workshop, or studio space, or may be as small as a single desk.

• Don’t require outside guidance

  Sole proprietorship usually entails working alone, so while you can call on mentors, other small business owners, or startup coaches for advice, most of the day-to-day tasks can be done by just you. To make sure you’re across everything you need to run a business by yourself, you may want to look into upskilling before getting started.

• Meet zoning regulations

  Check that your business idea is not restricted in the zone you live in – for example, some residential zones won’t allow you to have over a certain number of cars arrive to your premises on a given day, which may be an issue if you’re wanting clients or students to come to your house.

4. Brush up on your business skills

• Keeping records of your hours spent working
• How to make an invoice
• Keeping track of expenses
• Keeping track of orders and other forms of income
• Managing client/customer details securely
• Figuring out a bookkeeping system and tax obligations
• How to manage email, online marketing, and software packages that are relevant for your business

5. Create your business plan

• Your business name
• An overview of what your business is and its purpose
• What your target market is and who your ideal clients/customers are
• An overview of your main competitors or of businesses comparable to yours
• What day-to-day business activities you intend on undertaking
• Plans for marketing, expansion, and scaling up
• Expected expenditure and earnings

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6. Set up ABN, tax, insurance and registrations

• Set up an ABN with the Australian Tax Office

  You may also need to register for GST depending on your expected turnover.

• Get public liability insurance

  This is relevant if customers will be coming into your home as it protects if someone gets injured on your property. It also protects you against property damage.

• Get professional indemnity insurance

  This is relevant if you’re providing various professional services as it protects you against potential claims that you’ve given bad advice or did not administer a service correctly.

• Consider further insurance

  Consider if income protection insurance or small business insurance is appropriate for your situation.

• Registrations

  Research whether there is an appropriate accrediting or registering board for your industry, and take out a professional membership if relevant. This membership may be optional, so it’s worth weighing up benefits memberships provide – such as training opportunities, discounts, promotion, and building trust with potential customers – against the cost.

• Organise finances

  If appropriate, apply for business loans or a credit card or bank account for your business.

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7. Start promoting your business

Build an online presence

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FAQ