Inside Job: Home-Based Business Basics

Get Your Business Up and Running

Had enough of the rat race? Maybe it's time to start your own business -- and many people have had success opening shop from within their homes. In our Inside Job special feature, we've gathered information you can use to learn the ins and outs of doing a home-based business right.

For the basics -- and the finer points -- of home-based businesses, we've turned to Paul and Sarah Edwards , co-authors of "Making Money with Your Computer at Home" (Tarcher, 2005) and "Home Based Business for Dummies" (For Dummies, 2005). They took questions and provided insight on self-employment in this live discussion.

For more on entrepreneurism, visit last year's Small Business 101 special feature. And there is plenty more information on jobs and careers in our online Jobs section .

The transcript follows below.

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Fairfax, Va.: How much does a virtual assistant make annually? Is it worthwhile to do it part-time while keeping my day job or should it be a full-time venture?

Paul Edwards: A virtual assistant who bills 20 hours a week, working at $30 an hour will gross $30,000 a year. Many virtual assistants charge more and work more. If there has been a national survey on earnings, you might learn of it on a site like www.virtualassistanceu.com.

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Washington, D.C.: Hello! I have been working at PR firms in the D.C. area for the past seven years. I enjoy working with clients but the office politics get to me, and sometimes I think I'd rather work as a PR consultant on my own, from home. The only problem is, I can't take any clients with me and would need to start from scratch. This seems pretty risky in terms of bringing in the dough. Do you have any advice to offer on getting started?

Paul Edwards: First, while you're employed, participate in as many organizations and professional events as you can to develop relationships that when you go out on your own might lead to referral business.

What one man with a local practice did about the not-being-able-take-clients-with-you problem was to get a news story published about his starting his own firm. By emphasizing his specialty he was able to get his release published. Some of the clients he served at his firm saw the article, approached him, and he was thus able to serve them.

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Washington, D.C.: I want to start my own home-based business in January. However, I've heard that home-based businesses often fail. Can people really succeed in working from home?

Paul Edwards: There's a lot of misinformation about success and failure rates. In 2003, the Small Business Administration published a study of over 12,000 firms. It found 67 percent were still in business after four years. Of those that closed, 17 percent were wrongly considered "failures." Actually the businesses had been sold, the owner took a job, etc. Factors that contribute to being among the 67 percent include a college education, having $50,000 in capital (to finance the years you may not be making a profit) and keeping overhead down by operating from home.

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Reston, Va.: What are the best places to look for legitimate home- based work?

Paul Edwards: Finding a "job" on the web is chancy at best. There are lots of scams. But there are companies that provide hybrid opportunities. We interviewed the CEO of Willow a few months ago on our radio show. They do enable people -- who must incorporate -- to get telemarketing work (both inbound and outbound) without having to market their services.

To help you avoid scams, we offer the complete chapter from "Home-Based Business for Dummies" on avoiding scams on our workingfromhome.com as a free download.

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Interested in working for myself, Va.: I am considering a procurement venture into government contracting. I am having difficulties on how to start a business plan early into a planning and brainstorming phase. Do you have any advice?

Paul Edwards: No need to be deterred about having difficulty writing a formal business plan. What's important is you answer vital questions like:

What is your business?

Who is most likely to buy what you will be selling, whether it's a product or a service? This is your target market.

Why would people buy what you offer? What advantages does your product or service have over what they can already get?

What are the best ways for you to reach your target customers?

You can talk these and other important questions through if this is your ways of doing this. For more about business plan, check out our frequently asked questions on our workingfrom.com Web site.

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Washington, D.C.: If my business fails and I have to go back to work full-time, what do I put on my resume? Failed business owner seeking job? Would it be better to leave it off the resume so I won't look bad to future employers?

Paul Edwards: I suspect you can "frame" the experience you gained in a way that will help, not hurt you. To make this specific to you, however, is a writing task and working with a professional resume writer might be a good investment. I suspect in one or more of the numerous career books that have been published, some writer has dealt with this.

Paul Edwards: You can "frame" the experience you gained in a way that will help, not hurt you. I suspect in one or more of the numerous career books that have been published, some writer has dealt with this. To make this specific to you, however, is a writing task and working with a professional resume writer might be a good investment.

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Arlington, Va.: Thanks for this great topic. How successful are e-zines that go to a niche market? Total population of potential target, as a guess, could be around 200,000 to 400,000. It could be more if folks in related fields found it useful. Thanks.

Paul Edwards: Most e-zines are being published free, consistent with the overall economic forces turning information becoming a free commodity. So how are you going to make money from your e-zine? Advertising, promoting a service or product that is sold, or paid subscription?

One "e-zine" I pay for comes both as a mailed CD and as a PDF file. Having both makes me renew the subscription year after year.

Figuring out where your revenue is going to come from is your most important task before launching. Take a look at this site: http://emailuniverse.com/e-zine-tE-zineEzine-Usability&id=770

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Raleigh, N.C.: After working over 25 years in Los Angeles in publishing (including the Tarcher Marketing Dept for your book "Working from Home" 1990) I relocated to the South to care for an elderly parent in 2005. Fortunately, Lulu.com, a POD technology company is based in Raleigh, headed by Bob Young, former Red Hat (Linux Software) co-founder. I became a Lulu book consultant to further his vision that anyone can publish a book, CD, DVD, or audio book via his Web-based technology, which coincidentally is the quintessential work-from-home job! I know many boomers are working from home due to a family member care taking necessity. What practical advice can you offer on how to balance two such diverse worlds?

Paul Edwards: Hello, Raleigh! We're glad you've found happiness in your new life.

Caring for a sick or elderly family member and working challenges increasing numbers of people. We think the key is to do work that enables you to have a flexible schedule and not expect yourself to do everything perfectly. Allow the course of the day to flow or unfold instead of specific time schedules (other than items like appointments or administering medication).

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Austin: Hi. I recently graduated from grad school. After three months in corporate America, I know I want to work at home. Soon. I have been thinking of starting an at-home business based on my degree (MBA), but I am worried that once people realize I just graduated, that they will not take me serious. Any advice to recent grads on how to make the transition? Thanks.

Paul Edwards: Some people do as you want to do and go directly from school to self-employment. But if you can weather the corporate -- and it can be nonprofit or government, too -- year for a few years, you can gain experience and develop relationships that will make your transition into self-employment easier. We've met people who have done this on a conscious basis, setting goals to get every possible experience to go out on their own. And it works.

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Northern Virginia: Does the federal government purchase services (e.g., staffing, public relations, etc.) from home-based businesses?

Paul Edwards: Yes. We have talked with people who have gotten work in this way. I'm not familiar with the current procurement methods but checking into this with the various agencies is what I would do. You may get some of this on the web, but if you're in DC, you can make some personal contacts.

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Arlington, Va.: I am very interested in working from home but I don't know what to do. I am A+ certified and Microsoft Professional so computers are not a problem but I don't know what can I do from home. I am concerned with Internet scams. can you help me?

washingtonpost.com: ScamBusters' Audri and Jim Lanford did a live chat on work-at-home scams as part of our Inside Job special feature.

Sarah Edwards: You are wisely concerned about propositions on the internet that offer to find you work for a fee. We've talked about this in other answers here. Your certification can be helpful for various things you can do - like office support, training and tutoring, virtual assisting - which can be done as home based businesses. But you will need to get customers and clients on your own.

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Columbia, Md.: I currently work for a non-profit in project coordination. I am also a distance student working on an MLIS degree with a concentration on Knowledge Management. I want to be a freelance writer/editor and knowledge management consultant. Where can I find resources that help someone assess the skill sets they have based on work experience and education to be coupled with someone's passion to create a business? Thank you.

Sarah Edwards: Our formula for matching skills with passions is spelled our in our book Finding Your Perfect Work. You can get a free portion of the book on the Finding Your Perfect Work on our Web site, workingfromhome.com.

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washingtonpost.com: Working From Home

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Paul Edwards:

We hope everyone reading this finds their way to doing work they want to do while living the life they want to live.

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Editor's Note: washingtonpost.com moderators retain editorial control over Live Online discussions and choose the most relevant questions for guests and hosts; guests and hosts can decline to answer questions. washingtonpost.com is not responsible for any content posted by third parties.