Small Business Startup
Setting up a Home Office

(Date posted: February 24, 2009)

During this step in your small business startup, you set up a home office. This home office will make it easier for you to prepare for the start of business operations.

Before starting this step, you should have:

  • Listed the startup requirements
  • Planned the costs and expenses
  • Gathered the needed resources

Previous steps show you how to do this.

The desired result of this step is a home office that provides all the space and facilities needed to manage your business development.

You will use the following topics to complete this step:

Guidelines
Procedures
Example
Go or no-go decision

You will use this home office in future steps to manage your business development.


IMPORTANT

Before using this information to start a business be sure to read the following notice: Disclaimer

Guidelines

Income tax deduction

If you want an income tax deduction for having a home office, talk to your tax preparer about any requirements for the home office.

How to save money when setting up a home office

Let's say you'd like to have a nice home office. But, you don't have the money it would require. Rather than waiting until you have more cash, or giving up on starting a business, do this:

Use bootstrap methods to spend an absolute minimum of cash. Get the business going and start making sales. Then use some of this revenue to gradually acquire the rest of the things you need to have a fully functioning home office.

Using this method, you need to decide which items you need now, and which ones can be put off.

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Procedures

These procedures continue the process of turning the assumptions and estimates for your small business startup into facts.

NOTE: If you are developing a low-cost, low-risk type of business, review the Bootstrap Methods page in another section for ways to save on cash.

These procedures are divided into the following subtopics:

Deciding whether to build the home office in stages
Deciding what facilities and equipment are needed
Deciding what computer programs are needed
Deciding what communications options are needed
Other requirements for your home office
Getting the home office set up and organized

If you decide to build your home office in stages, then the questions and actions described below apply only to the first stage. When building a later stage some of these questions and actions may not apply.


Deciding whether to build the home office in stages

If you presently lack the money or space needed for the desired home office, you may want to build it in stages.

  • Will you be building the home office in stages?

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Deciding what facilities and equipment are needed

This checklist of questions can help identify the facilities and equipment required for your home office:

  • How much space will be needed for your home office? (If not much space is available, you might have to double up on how the available space will be used.)
  • Where will the home office be located in your home? (Do you need a quiet space where family members won't continually interrupt you? On the other hand, do you need to monitor family members and be available to them?)
  • What furnishings will be needed? (You initially may want to acquire a desk, one or more chairs and tables, a cabinet or two, and a wastebasket. If you are short on money, you may have to use an existing table and chair for a while.)
  • What storage units will be needed? (These could be bookcases, closets, drawers in a cabinet, steel file cabinets, shelving on a wall, or storage bins. Items that aren't used often may be stored away in some cubbyholes around the house.)
  • What office equipment will be needed? (You may need a desk organizer, listing calculator, scissors, stapler, typewriter, and so on.)
  • What type of computer(s) will be needed, if any? (Will you need to purchase a better computer to handle the business transactions and Internet access? If you need to acquire a computer, should it be a desktop, a laptop, or both? If you will often travel on business, you may want a laptop computer rather than a desktop model.)
  • If you purchase a new computer, will it need a CD burner or DVD writer for saving large files?
  • What type of printer(s) will be needed, if any? (Will you need a pin feed printer, such as for printing checks, invoices, statements, or W-2 forms? If you don't already have a laser printer, should you buy a multi-function printer, copier, scanner, and fax machine?)
  • Will you need to print out documents in color? (If so, will an ink jet printer be good enough or will you need a color laser printer?)
  • Will you need to send and receive fax messages? (If so, will you need a dedicated fax machine because of the expected high volume? Alternatively, you might consider using eFax or CallWave to receive fax messages on your computer.)
  • Where will you place the computer, printer, and other equipment? (Ideally each piece of heavy equipment should have a permanent location on a cabinet, desk, or table. But lack of cash may prevent this.)
  • Where will you place the office supplies? (This refers to envelopes, paper for the printer(s), stationery, paper clips, and so on.)

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Deciding what computer programs are needed

This checklist of questions can help identify the computer programs required for your home office:

  • What type of computer programs do you need to purchase, such as a spreadsheet, word processor, presentation software, or graphics software?
  • Do you need the professional grade of these programs or would a "lite" or shareware version of any needed program be good enough?
  • Will you need a computer program such as QuickBooks Pro to keep track of your accounting and tax information?

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Deciding what communications options are needed

This checklist of questions can help identify the communications options required for your home office:

  • Do you need high-speed access to the Internet? (This can be provided by DSL telephone, cable modem, or satellite.)
  • Do you need a cell phone so you can keep in touch while out of the office?
  • Do you need call forwarding, as from your business telephone to your cell phone?
  • Do you need to answer telephone calls while you are working online with dial up? (Callwave and Pagoo, among others, provide this service.)
  • Do you need caller ID on your business telephone so you or someone else can screen your calls?
  • Do you need call waiting on your business telephone so you can handle two calls at the same time?
  • Do you need voicemail to record messages on your business telephone when you can't answer a call?

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Other requirements for your home office

This checklist of questions can help identify other requirements for your home office:

  • Do you want to open the business bank account now?
  • Do you want to order a business telephone now?
  • Do you want to order business cards and letterhead stationery now?
  • Will you need a digital camera for taking pictures of yourself, customers, social or sports events, or property?
  • Can you receive business mail at your home address? (If not, you may want to use a private mailbox service in your city.)

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Getting the home office set up and organized

Get the office space ready -- Clear out all the clutter and other items you won't be using in the office.

Acquire furnishings and storage units -- Put the furnishings and storage units in the office space. Install any wall mounted shelving or other storage units.

Acquire computer and other equipment -- Place the computer and other equipment where they will reside, at least at first.

Get the office space organized -- Organize your home office to suit your natural way of doing things. Add any lighting you need to work efficiently.

For helpful hints on getting organized, see the Organize your workplace topic in Chapter 16: Use Time Saving Tips of my free Magic Success Secrets ebook.

Use the storage units, if needed -- You may need to keep certain items stored out of the way, but readily available.

Buy some supplies -- Store the supplies in their designated locations.

Test your completed office layout -- See if you can access all the equipment and supplies. If you can't work efficiently, you may have to change the office layout.

Schedule regular backups, if applicable -- Set up a backup routine for important data kept on your computer's hard disk.

Start using the home office -- Now that your office is set up, use it to manage your small business startup.

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Example

I have used my own small business startup for this example. My answers to the checklists of questions should help you prepare your own answers.

This example is divided into the following subtopics:

Whether to build the home office in stages
What facilities and equipment are needed
What computer programs are needed
What communications options are needed
What other requirements are needed
Get the home office set up and organized

I have tried to keep my answers to these questions as simple as possible.


Whether to build the home office in stages

  • Will you be building the home office in stages? No.

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What facilities and equipment are needed

  • How much space will be needed for your home office? I will be using a spare bedroom in my home.
  • Where will the home office be located in your home? It is located in a spare bedroom away from the noisy areas of my home.
  • What furnishings will be needed? I will be using my existing desk, rolling chair, and wastebasket.
  • What storage units will be needed? I will be using my existing bookcase, storage cabinets, and steel file cabinet.
  • What office equipment will be needed? I have a desk organizer, listing calculator, scissors, stapler, and electric typewriter.
  • What type of computer(s) will be needed, if any? I will be using my existing Hewlett-Packard Pavilion with 2.50 GHz dual core processor, 6.00 GB Ram, 465 GB hard drive, and 64-bit operating system.
  • If you purchase a new computer, will it need a CD burner or DVD writer for saving large files? My existing computer has these features.
  • What type of printer(s) will be needed, if any? I don't need a pin feed printer. I will be using my existing Brother multi-function laser printer.
  • Will you need to print out documents in color? No.
  • Will you need to send and receive fax messages? If I need a fax machine, my Brother multi-function laser printer will be used.
  • Where will you place the computer, printer, and other equipment? The computer and multi-function laser printer reside on top of my desk. I don't use any other equipment. (This desk is a slab door placed upon storage cabinets.)
  • Where will you place the office supplies? The office supplies reside inside the various storage cabinets.

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What computer programs are needed

  • What type of computer programs do you need to purchase, such as a spreadsheet, word processor, presentation software, or graphics software? I will be using my existing HTML editor, spreadsheet, and word processor programs.
  • Do you need the professional grade of these programs or would a "lite" or shareware version of any needed program be good enough? I am using the 2003 professional version of these programs.
  • Will you need a computer program such as QuickBooks Pro to keep track of your accounting and tax information? I will be purchasing this program when I start receiving income from my website.

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What communications options are needed

  • Do you need high-speed access to the Internet? I already have a cable modem for high-speed access.
  • Do you need a cell phone so you can keep in touch while out of the office? No.
  • Do you need call forwarding, as from your business telephone to your cell phone? No.
  • Do you need to answer telephone calls while you are working online with dial up? No, I don't use dial up for the Internet.
  • Do you need caller ID on your business telephone so you or someone else can screen your calls? Yes.
  • Do you need call waiting on your business telephone so you can handle two calls at the same time? Yes.
  • Do you need voicemail to record messages on your business telephone when you can't answer a call? Yes.

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What other requirements are needed

  • Do you want to open the business bank account now? No, I will open it when I start receiving income from my website.
  • Do you want to order a business telephone now? No, I will order it when I start receiving income from my website.
  • Do you want to order business cards and letterhead stationery now? No, I will order them when I start receiving income from my website.
  • Will you need a digital camera for taking pictures of yourself, customers, social or sports events, or property? I haven't decided about this yet.
  • Can you receive business mail at your home address? Yes.

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Get the home office set up and organized

Get the office space ready -- All cleaned out previously. (What a job that was!)

Acquire furnishings and storage units -- I purchased unassembled or unfinished furniture previously.

Acquire computer and other equipment -- They were all purchased previously.

Get the office space organized -- It was organized previously. (I know where everything resides.)

Use the storage units, if needed -- Everything was stored away previously.

Buy some supplies -- They were purchased previously, and are being resupplied every so often.

Test your completed office layout -- It has been working successfully for me for several months.

Schedule regular backups, if applicable -- Backups are completed daily to an online provider.

Start using the home office -- I have been using it for several months to manage my website and small business startup.

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Go or no-go decision

This decision concerns the home office you set up in this step.

Go on to the Setting up an Accounting System step in your small business startup if you can answer "yes" to the following questions:

  • Are you confident and excited about continuing the development of your business venture?
  • Does this home office provide all the space and facilities needed to manage your business development?

If you have answered "no" to any of the above questions, go to this topic on another page to see what to do next.

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