Home Business

Different Types of Work From Home Companies

If you are looking for a way to make money from home, you will find many different kinds of work from home companies that you can get started. There are traditional businesses, party plan companies, direct marketing businesses that use representatives in a direct sales method. However, you may not have heard about the ways you can freelance to make money with one of the work from companies.

Freelancers do all sorts of things for the businesses that hire them. Some do data entry, process orders, collections, writing web content, and even design websites. All of these are great methods of learning how to make money online.

The field for freelancers is expanding at a high rate as more companies and businesses are looking to find freelancers to outsource work to. This saves them the time it takes to hire an employee and get them trained. It also saves the company time and space in their office. They also get the added benefits of not having to offer an employee insurance and pay the payroll taxes they would with an in-house employee.

You can work right from home on your own computer taking calls or doing other tasks on the computer and companies can monitor your work with sophisticated software to make sure you are working when you say you are. These are used when a freelancer accepts a per hour wage. This has really helped companies to trust allowing someone to be able to work from home.

Companies have really been able to lower their overhead costs and won’t need to pay as many supervisors by using work from home freelancers. Most companies who use freelancers will already have a procedure in place that will allow you to sign off your computer when you aren’t available or they will allow you to schedule the time that you will be online to work. Other positions can pay by the project or piece depending on what type of work you will be doing.

There are so many different work from home companies that allow you to work on the Internet. Just be careful in your search that you don’t get involved with a scam. Legitimate work from home companies won’t ask you to pay any money to get started working for them. Some websites that list job opportunities may ask that you pay a small membership fee but normally they will offer the best work from home opportunities.

There are companies who utilize sales reps to sell their products or services and most of this can be done online. Today’s methods of getting sales is much easier with the use of the Internet. You can operate most of these businesses without ever leaving the house. You don’t even have to carry an inventory of products as everything is automated and you just make a percentage of each sale you send to the company.

While some job markets are downsizing, work from home companies are expanding. Being able to work from home allows you to save the costs associated with getting to the office and paying for daycare. The Internet makes it easy for you to find work and handle your workload right from the comfort of your own home.

You’ll find lots of websites that list work from home companies on the Internet by doing a simple search. Do your research to make sure that the company you are thinking of working with is not a scam. If they ask you for money instead of offering to pay you, you should look for another opportunity. Many businesses have a legitimate need to use freelancers who want to work from home you just have to be willing to do the research to find them.

Everyone Benefits from Online Jobs and Work at Home

With the costs of living constantly on the rise and the economy failing, everyone is looking for an additional source of income or trying to find a way to make money after losing their job. The Internet offers a variety of ways to make money if you know what to look for. There are real online jobs where you work at your convenience right from your own home, but you need to make sure you follow the following tips to make sure you end up making money and not wasting your time.

Make sure it’s not a scam where they ask for money upfront!

There are many places online where you can find all sorts of jobs depending on your skills with a computer. Outsourcing has become very popular with businesses today and they have found it’s less expensive to hire people to work from home instead of getting employees for such things as data entry, accounts receivables, accounts payable, along with designing websites or adding web content in the form of informational articles and marketing their business in general.

Most of these companies who offer a place for you to find jobs like this will offer you a free basic membership so that you can search for an online job that suits you. For an additional fee you may be able to upgrade your membership so that you can have access to more job categories or be able to post your resume.

Normally, you can place a bid to do a job and bid on as many as you want. Businesses hire people to do different things and may pay according to the project or by the hour depending on what they need. Often work at home opportunities will be ongoing with a business once you get your foot in the door.

Make sure you can handle the job before taking it!

Don’t take on more than you can handle. If you have a home office set up already, you can handle many of the tasks that will be requested. Most of the jobs available will require no more than a computer with Internet access. Don’t get caught in the trap of taking on too many jobs that are all due at the same time. Most of the sites that provide online jobs will also have an area that the people you work for can come in and say something about you and you won’t want people saying you didn’t deliver on time. It could hurt your online career.

Remembering that these companies that are willing to hire you to work from home are businesses themselves that have a deadline to meet just as if you were going to their office to complete the work. Making sure your personal time is arranged in advance will help you with scheduling your work and the company you work for will know in advance if you won’t be available to work on a project they might have a deadline on.

Online jobs offer the freedom to make your own schedule with most work from home assignments.

Most of these positions or projects you will be hired for will allow you to make up your own schedule. You just need to make sure that you can meet your commitments as agreed with the business or individual you are working for. Make sure you block off some time each day to do nothing but work just as if you were actually leaving home and going to the office. You will have more freedom this way and won’t have to spend the time commuting back and forth from an office.

Many people enjoy being able to multitask while at they are working at home. Being able to throw in a load of laundry before you sit down to work for a half an hour or so on a work from home assignment is a great benefit of having an online job. Just think of how much more you will be able to get done around your house while being a stay at home worker.

Many experts are talking about how more and more companies are utilizing the freelance market to fulfill the duties that they use to have to hire employees for. Businesses and companies can save lots of money by lowering the number of employees they have to have room and office equipment for in their building. Online jobs and work from home jobs are the perfect solution for everyone.

Take a look at this month’s featured home based business opportunity in Ultra International.

This means that

• All partners are willing to disclose their current financial positions and ability to contribute to the partnership financially.

• All partners are willing to fully disclose the skills and experience they bring to the partnership, as well as any potential liability.

• All partners are willing to provide other partners with a credit report, background check, or other documentation supporting their viability to be involved in the business.

• All partners are willing to formalize who does what, when they do it, and why, in a partnership agreement. Why is this so important? Business partners generally all agree to pay the debts of the partnership. So, if one partner runs up debt and disappears, the remaining partner(s) is left repairing the financial situation and the reputation of the business. Having a partner is a great way to split the risk and the work, but it can be a headache if you don’t know the other partner(s) well.

A corporation is an entity that is completely separate from any person. In fact, corporations file their own taxes and have many rights and obligations, just as individuals do. Corporations offer some distance between you (an officer in the corporation) and the entity itself, which might be helpful when dealing with liability. (However, these rules have changed in response to scandal, and vary from state to state, so you will need to talk to an attorney to understand any benefits and limitations.) There are many types of corporations, and an attorney will be needed to advise you on the best corporation type for your business.

Some forms of corporation can be one person, so check the corporation laws in your state to determine if this is the best organization for you. As with partnerships, your city or county might restrict or forbid this type of business from operating from a private residence. There are also some hybrid forms of business, which are not truly and entirely like a typical partnership or standard corporation.

Those include

• A Limited Liability Company (LLC), which mixes the decreased direct liability of a partnership with tax advantages more common to a corporation.

• A Professional Corporation, again, mixing some aspects of a partnership and a corporation. This corporation type is usually available only to certain types of businesses, however, and often limited to high-risk occupations such as doctors, lawyers, and accountants.

• An S Corporation is a corporation that has formed a standard corporation (as described previously) but filed proper forms with the IRS to have the business’ profit taxed as if the business were a sole proprietorship. (Standard corporations are often also referred to as “C” corporations.) For more information on business structures and considerations, visit AllLaw.com. If you are uncertain which business entity is the right type for you and your business, check with an attorney. It is not unusual to start a business as a sole proprietorship and expand it to a partnership or corporation as the business grows, or as liability and other issues become more serious. Incorporating is an additional expense that, as a new business owner, you might not be able to justify until your income from the business can easily cover such costs.

Work At Home Business Form

You also must state whether your business will be a sole proprietorship, partnership, or corporation. A sole proprietorship is you, by yourself, owning and running the business. This is the simplest and most common form of business organization. Your income and

expenses from the business are reported as part of your federal tax return on Schedule C, and you don’t need to file incorporation papers to “form” your business. The simplicity of this form of business is a distinct advantage, but it offers some disadvantages, as well. The chief disadvantage is that liability flows directly to you. This means that a customer can sue you directly for failing to perform the services you agreed to provide. Your home and other assets could be at risk. You can mitigate this risk by purchasing liability insurance (or errors and omissions insurance). If you own few assets (and rent, rather than own, your home), the liability issues might not be as important.

The more assets you have, and the more people who know you have liability insurance, the more likely you are to be sued. The nature of your business is also a key factor. Are you offering services in which safety could be a factor, such as a building contractor who has to be sure that a staircase doesn’t fail? Are you offering services that could greatly impact someone’s life if done incorrectly, such as accounting or legal advice? What happens if you don’t perform as promised? The greater the potential fallout to the client, the more likely someone could be injured or killed, and the more likely someone could be financially ruined, the more likely you are to be sued. A partnership is a formal partnering of you with at least one other person. Forming a partnership generally requires an attorney. As a home business, you might not be allowed to form a partnership unless it is with your spouse or domestic partner (depending on regulations of home businesses in your area). But this could make a partnership the ideal business structure. If you and your significant other are going to share in the work and expenses anyway, this might be a way to formalize that agreement.

Forming a partnership with someone not living with you is a bit trickier. But this is the twenty-first century—the era of the virtual company. If this is someone you know you can trust, and zoning regulations allow it, there’s no reason why two people in different cities - or even different states or countries—can’t use this business form. (With more than one state or country, however, bear in mind that you might have to report income or file forms twice - once in each jurisdiction.) Whether your partner is in the next room or the next country, however, always consider such an arrangement carefully. Ask yourself whether you really know the person you are partnering with for this business. And no matter how well you think you know him or her, treat it as any other professional transaction.

We will tell you what this home based business form means in the next post!

Will the Business Fit Your Physical Home?

Perform a thorough, visual walk-through of your home. No matter how crazy, briefly consider the possibility of each room in your home being used as your home office or workshop. List your top three possibilities. Of the top three options, which room is best suited for this purpose? Will you need to repaint or switch bedrooms or other uses? Is the wiring “iffy”? Is your home prone to leaks? They can damage costly equipment, so address the problem before you move in costly furniture and computers. Is the area out of the traffic flow of your home? Will it be sufficiently quiet, so you can work? Is it separate enough, so you can avoid entering the work area when you are on personal time, such as evenings and weekends?

If you don’t have a separate room, don’t worry. Can you divide a larger room with panels or room dividers? Or mark an area by the use of a different carpet and/or creation of “walls” using bookcases? Not only does this break up the space and encourage a better work-life balance, but it also helps meet the IRS provisions of having a separate space dedicated to business activity. Unless you provide day care, you will have to be sure that the space is set aside solely for business purposes, and not used for any other reason, if you want to deduct related expenses. For more information, see the IRS website: irs.gov/taxtopics/tc509.html.

Stay tuned as we will continue to talk about making sure your family is behind you and supports your work at home business ideas!

Studying Relevant Planning and Development Restrictions

How will you use your home to operate your home business? That question is a big one - and one you will have to answer to the satisfaction of your local planning commission, as well as your landlord if you rent. Those living in condominiums or other planned developments will need to review their CC&Rs (Covenants, Conditions, and Restrictions), which might restrict or forbid a home business. Whether you need to speak to a city planner, your homeowners association, or your landlord, their concerns will be the same:

They do not want you doing anything that will create noise, traffic, or eyesores that will in any way interfere with the quality of life in your neighborhood. Homeowners and planners will particularly be concerned with a possible decrease in property values. The following sections discuss specific ways you can track down and familiarize yourself with the relevant rules and restrictions governing small businesses in your neighborhood.

Determine That Your Business “Fits” As a Home Business

Is your business suitable as a home business? To make that determination, ask yourself how well your situation matches these descriptions:

• Almost no clients will visit your office. When they do, it will be rare and will be one car/one person at a time. Someone viewing your home from the outside would not know that a business is being run inside.

• You will rely heavily on phone, fax, email, and regular or “snail mail,” and you will frequently visit clients at their offices or meet them at a coffee house or restaurant - if you have to visit them at all.

• You are probably offering a service. If you are offering a product, it is either solely offered over the Internet or through mail order; or it is in conjunction with, or resulting from, your service business.(For example, as a writer, I offer both a service and products (books), but people don’t come to my house to buy them.

• You regularly employ only yourself and can run the business without permanent, full-time employees. (Occasional or temporary help is fine. More on this later in the article.)

• Your business does not require exterior signage or equipment that’s too large or otherwise incompatible with in-home use.

• It would be virtually impossible for someone passing by your home on foot to know that you are conducting business.

• Your home can accommodate any special needs the business will require - such as adequate space for activities and necessary equipment (copiers or printers for a small printing business, room for temporarily holding dogs for a dog-walking business, space for producing soap and bath salts for a small toiletries business, and so on). The less your business fits the preceding profile, the more difficult (but not necessarily impossible) it might be to actually operate your business from home.

Two important factors might give you the setting you need even if your business differs radically from what is detailed previously: the specifications of your own home and your local area’s planning guidelines. If your home is a studio apartment, you will be much more limited than if your home is a 10-room house with one or two acres of land. Setting aside a storage room, or setting up a shed, for your business is much easier if you have the space for it. The long-term development goals of your community - as expressed by your city or county’s planning department in the form of building codes, use regulations, and other rules - will also greatly determine how close your business must fit the previous description. Which leads us to our next “make or break” consideration.

Considering the Risks

The most threatening risk of self-employment is simply put. If you don’t work, you won’t have any money. You could go bankrupt. You could go homeless and hungry. The feedback that leads to these consequences is equally, brutally abrupt. The phone will go silent. The mailbox will be empty. There will be no performance reviews, no “warnings,” no closed-door meetings offering a second chance. And the risk is very real. Approximately 500,000 small businesses (10% of all businesses in operation) closed in 2003. A roughly similar number started the same year.

Of the business closures, a little more than 35,000 went bankrupt - meaning that they couldn’t pay their bills. (For additional information on these statistics, visit the Office of Advocacy website of the Small Business Administration, app1.sba.gov/faqs/faqIndexAll.cfm?areaid=24.) Perhaps 10% of all businesses doesn’t seem like a high percentage to you. But when you consider the hard work, money, and risk assumed by someone starting a business, you quickly realize it is a high stakes gamble. If another 10% of all businesses fail the following year, too, and the year after that, and the year after that (as the historical data cited previously suggests), perhaps very few small businesses succeed
for very long.

But it’s the gaps in information that speak the loudest. We don’t know who fails, really - which industries, or which small businesses. Nor do we know why. Even the methodology is open to question. Search for “small business failures” on the Internet, and you are more likely to find arguments about why some statistics are misleading than you are to find the statistics the debates are actually referring to. So it is pretty much up to you to figure out if the risk is worth it - with at least some indication of a pretty high chance of failure.

Assessing the Costs

In addition to the possibility of failure, however, you are also taking on considerable cost. In essence, you are gambling that you can make enough money in your home business to provide you with adequate income and cover the additional costs you’ll assume.

Here are just some of the many expenses you’ll take on when you become self-employed:

• All of your Social Security contributions - 15.3% of everything you make over $400. Right off the top, you’ll pay $3,060 for earning a modest $20,000.
• Estimates of your income tax payments - with penalties and interest if you under pay.
• All of your retirement contributions, medical and dental insurance, disability insurance, life insurance, and child care. Kiss your “matching funds” goodbye. Remember your employer’s cafeteria plan? Well, the cafeteria is closed now.
• Vacation pay, holiday pay, sick pay, bereavement leave. Call it whatever you want (hey, you’re the boss now), but no one is going to pay you for these days. This is now coming out of your earnings.

This isn’t even a complete list - just the start of a long list of risks and responsibilities you are now going to fully accept. You’ll also be responsible, for example, for purchasing and maintaining all of your equipment and supplies, providing utilities, paying for your business postage, and doing without the services of the mailroom, tech support group, and cleaning staff.

Take a moment to compile your own list of the complete costs and benefits you’ll be assuming when you start your own business. Then, compare it to the costs and benefits of regular employment that you assessed in the preceding section. By comparing the two assessments, you’ll have a better feel for the demands and rewards of the road ahead.

How Long Should I Keep These Records?

The length of time for which you must maintain your business records varies by type:

• Client contact information. As long as a client is active, all contact information should be readily available. Records for clients who are not active, but with whom you are on good terms, should be kept, too - these contacts are excellent sources for mailings, and provide additional value should you choose to sell your business down the road.

Working files should be kept for at least several years - long enough to be sure that the service or product provided has been paid for and its value not called in to question. What are working files? They are the notes, drafts, papers, and other items you accumulate as you work on a project. They are not the finished project itself, but the preliminary drafts, discussions, and note that lead to the final version.

If there are legal, ethical, or other considerations in your profession, you might need to keep your working files longer. (For instance, attorneys, accountants, and insurance agents might be required, either by laws or the ethical canons of their profession, to maintain records for a set period of time. If you are in these businesses, you should know these regulations quite well.) Personal preference comes in to play, too. I know some writers who still have working notes from stories published 20 years ago - and I know other writers who toss all papers as soon as a story is published and they are paid.

Keeping working files for at least three to five years, however, is not a bad idea and will help your work at home business.

• Financial records should be kept as long as you own your business. Because it is relatively easy to maintain a lot of records on your computer, you can keep the basic information there while archiving physical paper files to a storage facility after several years. If the electronic files get too cumbersome, move them off your computer and onto a CD-ROM or DVD. It seems odd to keep years and years of financial records handy, but as you run your business, you might want to have these files readily accessible. Even if you move the records to some type of electronic storage each year, keep the records handy. The information stored in them is valuable to you, as you watch for year-to-year trends, and compare each year with prior years.

Setting Up Your Home Based Business Office Space

You have your record-keeping functions in order; now you’re ready to set up your office space. But before you connect all that shiny, new equipment from the last article, make sure that these items are in order:

• Is your electrical system up to the task? Are the outlets where they need to be? Are the phone jacks near the actual phone base? Is the wiring “iffy”? Then have it inspected and upgraded before proceeding.

• Is your office space dry and free from water leaks? Leaks can damage costly equipment, so address the problem right now.

• Give your home office that extra coat of paint if needed. Buy a new rug, hang your favorite painting, and make it comfortable. You will be spending a lot of time here. Make it comfortable!

• Your home office might have been the family junk room before you took it over - end that pattern! Furniture, wall hangings, or knickknacks that just don’t fit in other parts of the home are not allowed in your office.

Get your physical home business office as ready as you possibly can. You will want to start operating out of this office right now (if you haven’t been already).

Tracking Invoices and Work From Home Income

For most service-based work, you will need to send an invoice to your clients. You should number your invoices in sequential order, although what number you start with is up to you. Record each invoice number, as well as the date, description, marketing code, and amount of money invoiced. The description should briefly state who the invoice was sent to and what project or work it covers. (More detailed information will be on the invoice itself, as well as in email communications and contracts with the work from home client.)

You can use your invoice-tracking document to help track the source for each project you invoice. That way, you know what marketing methods have been the most successful in your business. Adding a “marketing code” to your invoice tracking document is one way to record this information. Because it is your business, you will develop your own codes. Some suggestions are as follows:

P for postcard mailings
G for groups you belong to
W for former co-workers or those from your former company
R for referrals from current or former clients
M for magazine ads

You might also want to make these codes more specific; for example, “P” for referrals from your PTA contacts, “1QP” for the first quarter postcard mailing, and so on. As I said, the system is really up to you. The goal is to keep track of what kinds of advertising and publicity work best for you so that after your first year, you can clearly see exactly where to put your marketing dollars and why.

If you sell products, you probably won’t send an invoice for each book, basket, or piece of jewelry sold. However, you should set up a separate sales record spreadsheet that keeps track of these amounts, as well as any sales tax you collect.

Must Have Hard Copy Work At Home Business Records

Electronic documents are easy to store and take up much less space. But as of this writing, there are still some things that should be kept on paper. Technically, you can scan every scrap of paper you might keep and store it electronically. However, you might prefer, instead, to keep the paper version for awhile, and only go the scanning route if you are certain the document is likely to be kept for archival purposes only.

Also, some legal documents can come into a gray area. If you signed a contract with a client, keep the paper copy. It’s much easier to prove the contract was actually signed. Here is a list of the paper records commonly maintained by most businesses:

1. Client contracts. These are the contracts you and your clients sign when you agree to perform services. If the agreements are email/letter exchanges only, be sure to print those out and keep them in the same place as your other contracts. Get any verbal agreements confirmed in writing, even if it is only an email or letter reiterating your conversation.

2. Working papers of current and past projects. These are the notes, research, drafts, and other items from each project. If you have a database of your work, these files should have the inventory number of the appropriate work.

3. All business-related receipts (even if only part of the expense is home business related). Credit card slips should be saved, even though you will also have a monthly statement. Expenses in which only part of it is a business expense (for example, your electric bill) should also be saved.

4. Informational files. These are files about groups you belong to, issues affecting your service or subject matter, and copies of all marketing materials.

5. Copies of tax returns, beginning with the year you start your business. (You should probably keep your returns from prior years, too, although for nonbusiness reasons. Check with your accountant or with the IRS website, www.irs.gov.) The same goes for state and local taxes.

6. Previous versions of your business plan. As your home business plan changes and grows, you will want to keep past copies. Print your business plan and file a hard copy once every six months, or just before and after making broad changes to it.