How A Rural Homesteader Starts A Home Based Business

On our homestead we have always made extra money for car insurance and school clothes by raising and selling our animals. But as our children grew up and away from home, we wanted to get into a business not dependent on animals with their vet bills and feed bills. We also began to think in terms of retirement, a time in which we would no longer be able to work, and a time where economics probably would not allow us to live on Social Security alone. By laying the groundwork early, we plan to one day retire and devote full time to our home based business of writing about sustainable living.

The home based business is one that is operated from your home. If you are a rural dweller as most homesteaders are, then you may find you will have to take your product or service to your client instead of him coming to you. But that's okay. You never have to worry about intruders during the dinner hour; your rural retreat is still your domain and remains just that, your retreat.

Because you must take your business to the person in need of your services or product you will not need a formal office. In other words, any corner of any room can work as your office space. You can use a telephone to contact your prospective buyers, but this will run up your telephone bill if almost every call is long distance. You can use the mail to draw attention to your business by mailing flyers to prospective buyers, or you can go to them with a portfolio. You can also advertise in the local newspaper.

But what are some of the possible home based businesses you ask? Lets look at them. First of all, stay away from ads in publications that promise you a lot of money quickly. We tried a few, and discovered that the only person making the money is the person running the ad who usually wants you to send a sum of money for their information. The information will usually lead you to a blank wall or into something that is not worth your time. Yes, assembly jobs are plentiful, but your time spent in assembling the product is worth far more than the company is willing to pay. After assembling the product (there is usually a minimum in which you have to purchase, assemble and then sell back to the company) we found it took far longer to earn their wage than if we had worked at another task. Few of us are capable of assembling something by hand so quickly that we can turn out hundreds or even thousands in a week to make the money these ads claim to pay. And then you have interruptions so that you may not get back to the assembling job for days.

Also, a lot of ads are merely selling a list or directory for a high price, and most of the companies in the directory are already out of business, have enough assemblers, or are frauds! One company we assembled electronic boards for sold us the boards promising to buy them back after we assembled them. Before sending them off, we took one to an electronics shop in town and had it tested. It worked fine. However, after the company received it they wrote us back stating that the board worked in reverse and would not pay for it or allow us the chance to make more. Now, I am assuming that it is impossible for an electronic device to work in reverse. If any of the components had been assembled backward, the device would not work at all.

We tried to contact the company but they were not listed in the telephone directory, the number we had originally been given was disconnected and our letters went unanswered. We tried another electronics board company from the same directory and after we bought the boards and assembled them we never heard from them again.

One company we assembled clown puppets for was very good. They did just as they claimed, sold us the 10 clown kits and bought back the finished product. But it took all of three weeks to make $50! And that was with both of us working at the project which breaks it down to $25 each for three weeks work. True, we didn't work at it steady as one had to wait on the other to complete a step before he could do the next step. Still, this is low wage. Of course, in time we would have become faster at the task, but I'm afraid I lost interest before we saw much money. Who made the profit? The company of course. Also, if my husband had not been equipped with a woodworking shop we could not have done it at all since the kit consisted merely of various sized blocks of wood that had to be shaped, cloth scraps and a pattern!

So where does one turn to be successful? Look inside yourself! Something that you do everyday for enjoyment and have done for years could be the key to your home business. If you enjoy it and have done it for a long time you know you won't give it up. The thing that makes an entrepreneur is the ability to hang in there beyond all costs, take risks, and have confidence and motivation. Only you know your talents, your desires, your qualifications. And little do you know it, but you also hold the key to marketing.

Your market is the person who will buy your product or service. He is the person who needs what you have to offer. And most times, if you look to your supplier you will find your market. In other words suppose you sell hand lettered stationary, or stationary that you design on the computer. You have to buy the paper; and your supplier also needs stationary and letterheads! Don't hesitate to offer to do his stationary at a special price just to get you started and to use his name as one of your satisfied customers.

There is a market out there for almost everything, you just have to find it.

Our own business began as a bubbling spring from within ourselves when the disk drive of my outdated computer which I had had for about ten years finally went out. I had been writing professionally and knew I could not go back to the old typewriter. John insisted I buy a good, state of the art computer for my work, and I wanted one the whole family could use but when we finally made our selection we found we had invested about $1800 including the printer. Like the cow that pays for itself with milk, or the chickens that pay for themselves with eggs, I wanted that computer to pay for itself.

We are not new to homesteading, having begun with the purchase of five acres of bare desert land in 1969, then 18 acres of wooded land in 1979. My husband constructed all our buildings and did the plumbing and electrical work himself, and we saw how new homesteaders were just starting out and didn't know where to turn for answers. We knew from experience the pitfalls and hardships that lay ahead for anyone who wants to be self-sufficient. We wanted to offer our knowledge to others at a reasonable fee. With our knowledge of homesteading and publishing we began our venture.

Marketing: Once you have looked within yourself and discovered your talent and abilities as well as your pleasures you need to sit down and analyze the market. Ask yourself these questions: How will you sell your product? Who wants to buy your product? What is the competition? How does your competition market his product? Can you compete?

Marketing is the key to success. Aim at the correct market and you can't go wrong. Don't try to market ram pumps at a gun show for instance; you will be wasting time and money. But try giving out literature on ram pumps at a livestock auction and you could hit the right market. Or offer literature on ram pumps through a real estate agent who sells undeveloped land by asking him for a list of his clients.

Study the market and plan how you will approach it. As already mentioned, there is the telephone, mail order, shows, internet, and direct approach. The direct approach could mean parking your truck along a well traveled road and putting up a sign to attract customers. This is an approach well received if you have organic produce, hand crafted wood items, quilts, leather items or almost anything you make or grow yourself. Display your product on the roadside and people will stop in droves.

We knew our market was homesteaders. We wanted to offer informative publications to that market at a reasonable price. To do this, we had to keep costs to a minimum. That meant we had to do all the writing, lay-out and design ourselves. Our first book went to the printer with an order of 500. It cost $200 more than the original estimate and we decided then and there that we would also have to print the books ourselves if we intended to provide something homesteaders could afford. Our own Epson Action printer did a beautiful job, but it was slow; so we invested another $1000 in a copy machine, and an additional sum in a binding machine. These added expenses would eventually be paid for, but continuing to go to an outside printer would never get us ahead. We knew we would never get orders for 500 books at one time, but we could print them a few at a time, meet the demand, build an inventory of additional titles, and offer a personal service to our customers.

Our early books were stapled, but we wanted the pages to lie flat so they could be easily read. That is, if a nursing mother was feeding her infant she could still read one of our books. Or if a homesteader was handling a sick rabbit, he could examine the rabbit for symptoms while comparing them to those presented in the book. We went to the spiral binding and found it satisfactory.

Advertising: Mail order marketing is a lot like fishing. You place your ads and wait for responses. These don't necessarily have to be buyers, just interested people. People you can count on to be there when you have a new item to offer. By building a mailing list of responses, you build your business.

We began advertising in the same magazines we enjoyed reading. It is important that if you are going to do mail order marketing that you plan months in advance. Ads that you place today will not be read for two to six months by readers. This gives you time to build up your stock whether it be books or crafts. In our case, we placed our first ads then began printing and binding our books.

Depending on your product, advertising can be your heaviest expense. Again, you need to know your market to know how to spend your advertising dollar. It might be costs incurred at the printer for flyers, newspaper ads, or sign painting. If you have a product or service to sell you will have to advertise even if its only with business cards you hand out at craft shows.

Branch Out: Now that you are safely on your way to operating a home business look deeper within yourself and discover how you can branch out. These little extra ideas could bring in more profit than your main item. If, for example, you are selling handmade or machine quilted quilts, consider adding quilted vests, pocketbooks, and pillows. This way you can sell two or more items to the same customer and at the same time catch that customer who cannot afford to pay premium prices for a full size quilt, but does want a handmade quilted item of some sort.

The same goes for woodcraft items such as children's toys, branch out to include weather vanes or custom cabinets for the home or workshop. The more you brainstorm the more you improve your business.

We began The Christian Homesteader Newsletter in January of 1994. Intended to answer a need for the homesteader who feels a spiritual closeness with God and to the land, The Christian Homesteader was our branching out to offer new ideas on being self-sufficient, being a steward of the land, to share ideas. Not surprising, the newsletter was our biggest pull.

Keeping Records Or Controlling The Out-Go: By all means keep accurate records or you could end up bankrupt! How else can you apply the brakes when you are spending too much and not bringing in enough. Your first investment should be in a set of books. You need a daily journal to record every business transaction that happens that day. Enter each transaction and save all receipts. Include sales under income, and purchases for such things as supplies, office equipment, postage, advertising, gasoline if you use your vehicle, telephone calls, and any other necessity under expenses. At the end of the month tally up the income and expenses and figure your net loss or profit.

Also purchase a general ledger. In the general ledger list the totals at the end of the month from each column of the daily journal. This way you can tell at a glance the total you have spent on any item for any given month. When tallied and figured for a profit or loss, the totals in the general ledger should equal the profit or loss in the daily journal.

If you have a computer with a spread sheet, it makes it easier as calculations can be easily and quickly done. But don't forget to save a printout in your files or you could lose your entire set of books if a disk crashes or during a thunder storm or power outage. We maintain both a hand written daily journal and the computer spread sheet. These books will be needed if we are ever audited by the IRS.

Purchase an inexpensive cardboard file box and keep all your records there. This file can be easily stored in a closet and then set on the table for conducting your business during the day. We have metal filing cabinets, but for the person just starting out there is no need for more than the cardboard files unless you have the cash and space for them.

Any publication, book, or newspaper that you purchase to keep you informed on what is happening in your business field is considered a tax deductible item. Be sure to list a place in your record keeping system for recording these purchases.

Above all else, keep your personal cash flow separate from business cash flow. Open a special bank account for business only. Most banks charge extra for business accounts. The checking on a business account is not free, the monthly service charge can be higher, and there may be other expenses involved depending on the bank. So when just starting out, avoid telling the bank that you are opening a business account. Simply open a regular account under your name and include your business name and address on the check. Try to get one that offers free checking; that is one with no service charge and provides free checks. Sometimes this requires that you maintain a minimum balance in the account, but that's all right since you don't want a business account without a balance anyway. If your age warrants it, you may be able to get a free checking account for seniors and use that as your business account.

Write checks for all your business transactions such as purchasing supplies and paying expenses. This aids in bookkeeping, maintains a record, and controls cash flow. Balance the check statement immediately upon its receipt each month. Don't let a few days lapse that could lead up to a week before you balance your books or you could run short of funds and not know it.

Know what to expect in the way of large expenses and be prepared for them. If you know, for example, that you are going to need a new computer program, or some other necessity which costs less to purchase in quantity or from a company that offers free freight if your order totals a certain amount, plan on buying that large quantity or computer program during a month when other expenses are low; this can be a major tool in controlling cash flow. Although it may not be possible to foresee every expense ahead of time, it is pretty well established that you know what most of your expenses will be and can plan for them.

Plan Ahead: You know what raw materials and supplies are necessary to produce your product, and you should know how much is used in the process of manufacture. If you are running a service oriented home based business, you will still have to maintain records and will need materials for your own use even if they do not come under the heading of raw materials. You may need to purchase office supplies, health supplies, or whatever your service offers to remain in business. In other words, say you are running a private home health care service. Your major expense could be gasoline for your vehicle, disinfectant and rubber gloves. Best to stock up on disinfectant one month and rubber gloves the next month to keep cash flow even, unless your supplier offers you a cost break in the way of a reduced price or free shipping when you order both at the same time. Take frequent inventory so that you do not run out before you are scheduled to reorder.

It would be nice if sales just rolled in day after day after day. Unfortunately that is not the case. Every business has slack periods and you need to plan ahead for those times. The reason the home business is so popular is because the small business often went bankrupt when business was slack and the lease on the building still had to be paid. You can find enjoyment in slack periods by adding to your inventory or by taking time off to do other things. You don't have to worry about paying the rent because your office or workshop is in your home.
Know when to expect peak sales and be prepared to meet them. Don't run out of a product to sell in the middle of a show or season. If you are growing herbs in a small greenhouse plant plenty. What you don't sell fresh can be dried and packaged as homegrown herbs or mixes, or made into potpourri and sold in pretty containers with your business card attached.

Plan Your Work Schedule. Just as you would be expected to put in a good day's work if you were employed for another person, so you should expect to do a good day's work for yourself. Set aside the number of hours you want to work each day and then maintain that schedule. Be efficient. Sometimes you may be interrupted by personal telephone calls. Don't hesitate to tell the caller you are busy and will call them back. Then remember (make a note of it) to call back. Your friends will soon get the idea that you are serious about your business and will respect you for it.

At Homestead Books , we spend more hours working after midnight than during the day. This is due to obligations to family, animals and outside jobs. Since this schedule suits us, we are dedicated to it.

Also plan for a change in the market. Supposing the market changes and there is no longer a need for your product or service, what will you do? Can you easily adapt yourself and your equipment to a new challenge?

Be Patient: Don't get discouraged if your business does not take off and go right from the start. People have to know that you are dependable and will wait until you have been in business for some time before coming to you. They have been scared off by business scams and you can't help but understand their shyness. Time will bring results.

Expenses at first are very high. In the beginning you will invest in equipment and supplies and you will have no sales record. Be patient and the expenses will level out and the sales will increase.

I hope some of the things I have written will aid you in brainstorming your way into a successful home based business. I know I haven't touched on nearly all the ideas out there, but only you know your own particular area of expertise, its market and your own abilities. Learn the basics of good business such as bookkeeping and keeping your customers happy, and you're on the right road to success.