Types of Home Businesses
There are a number of things that need to be considered when starting your own home business such as the products and/or services that you will provide, initial costs, location; the most important decision, however, is the type of business. There are two basic home business types: independent or a branch off of an already existing business.
Although starting your own independent home business may seem like the perfect opportunity to get rich, it sounds much easier that it actually is. If you are lucky enough to be among the 10% of start-up businesses to make it through the first year, there are still many challenges to be met. It's difficult to compete with another small business, let alone those that are well established and trusted by their consumers. Unless you have something extraordinary to offer, for which the demand guarantees sales, it's impossible to stay aloft especially with continually increasing competition. So why not help expand an existing business and make a nice profit in the mean time?
The following is a chart that compares standalone to affiliate businesses.
| ||Standalone Business||Affiliate Business|
||High risk. 9 out of 10 businesses fail within their first year. Being the only authority figure, you also have to tackle the learning curve on your own.
||Low risk. Any business in the position to pay affiliates a percentage of their profit is established well enough to almost guarantee success, though your decisions have a big impact on the overall outcome.
|Advertising / Marketing Support
||Being a business owner means that all advertising costs are coming out of your pocket. Depending on the market, advertising may be less effective due to the amount of competition. Can you afford thousands of dollars worth of advertising to stay in the game?
||The business you're affiliated with takes care of most of the advertising and marketing, which means significantly lower advertising costs for you. Your main role as an affiliate is to acquire new customers.
||It could take many years and a lot of investment to become a recognized business. How will you build industry credibility for your business?
||As an affiliate you have the opportunity to offer a product or service that's been around for a little while at least. Be careful as to what business you chose and you'll have no problems acquiring customers.
||Network your own office; hire a technician to service your software and struggle with software glitches on your own.
||Most businesses have special affiliate management teams to deal with questions and offer help and advice. The quality of support in terms of response time and availability depends on the program, but you know it's there.
||It could take you up to 7 years to just break even on your investment; then more funding will be required to expand.
||You control how fast and how much your business grows by determining the amount of time you're willing to put in. There are no limits as an affiliate.