Hearth and Home
Since you're going to be working from home, there are few more important considerations than what your home looks like now, and how it will look once there's a home-based business in it. A kitchen table might be a place to start planning, but it's not going to be enough in the long term. You need to ensure that your home is a good fit for the business you're anticipating.
If your business depends on customers coming to your home — such as an artist's studio — your home's location is key. Will your local regulations (see the section on Zoning, later on in this chapter) allow this in your neighborhood? Is your home centrally located and easy for customers to find? Is there adequate parking space?
Small business consultants often talk about the cost of a business location being equal to rent plus advertising. While locating your business in your home will save on rental costs, you need to factor in how much you'll need to spend on advertising in order to get people through your door. A $600-per-month rental location downtown with great walk-by or drive-by traffic may actually be cheaper than having to spend $1,200 a month on advertising your home-based location.
Although many home-based businesses start with a desk in the corner of the master bedroom, this probably isn't a practical way to carry on. Most businesses need a dedicated space such as a den or spare bedroom. This not only gives you the space you need to work in, but also allows you to claim the business-use-of-home deduction on your income taxes.
Be security conscious. The computer equipment or business inventory associated with a home-based business can be a tempting target for thieves, who sometimes pose as customers in order to “case the joint.” If possible, use a separate entrance for your business area, so that visitors can't see into private areas, and be sure to lock up business equipment and inventory.
If your business doesn't involve customers arriving at the door, then you don't need to worry about where it is in the house — as long as you feel comfortable working in the space, you'll be fine. Since you'll be spending a significant amount of time there, however, make sure it's conducive to work: natural light, electrical outlets for computers, and a door that can close are all important factors. Also consider safety: Many basements don't permit business use, because they don't have the necessary fire escape routes.
For businesses with lots of visitors, your space really needs to be right next to your home's main entrance: You don't want customers walking through your family's private space in order to get to your office. To create this space, consider converting a living room or a garage to an office, or using a walk-in basement area.
Will your home-based business require storage for inventory or parts? Even space for business records can be tough to find in the average home. Does your house provide enough space for your storage needs — and more important, is that space safe and protected? A basement that's vulnerable to moisture or to sewer back-ups is not appropriate, especially for key records such as accounting receipts.
I don't have the space for storing records. What are my options?
Most communities have a variety of storage spaces that you can rent: everything from closets to garages to warehouses. You can also check telephone directories for record management firms: They often offer storage, and will even pick up your documents.
Phone Lines and Utilities
Your home also needs to have the infrastructure that your business will need. You may need an extra phone line or two to handle the business phone and fax lines, for example. Can your local phone company handle this, or would a cell phone work as a substitute for a landline if it's a problem? Do you have high-speed Internet access in your area? This may be an issue if you're in a rural area or one in which demand for services is already high.
When it comes to utilities, ensure that your home's capacity matches your business's requirements. Can your home's wiring handle the extra electrical load for your computer set-up, for example? Will your business require extra water or heat or a conversion from an electric to a gas stove? If you're using an outbuilding rather than space within your home, does it have the utilities that you'll need? If not, do local building codes allow you to install them? How much will that cost?