How entrepreneurs can grow their home-based business

Starting and growing a home-based is becoming a reality for many entrepreneurs. Two small business owners share why they work from home and how they've grown their companies.

Today, starting a home-based business can be for everyone, thanks to the rise of technology.

Cloud technology, in particular, has opened up new doors for budding entrepreneurs as the need to rent physical space right from the off has become redundant.

In 2016, 52 per cent of businesses in the UK were based in their owners’ homes – essentially one in every two. However, for all the advantages there are, when you work from your garage, bedroom or home office every day you are bound to feel a bit ‘out of touch’ at times.

This is one of the issues with technology, while it’s made us more efficient in so many ways, it’s also led to a decline in people talking to their suppliers and customers face-to-face. It’s not hard to slip into this routine when a quick email would be so much faster, but is this to the detriment of our communication skills?

When you spend so long working in the comfort of your own home, it can be a daunting prospect to then go out and interact with the public. However, if you’re looking to grow your home-based business then getting out there is the quickest way to increase your exposure, sales and profits.

Here are two success stories to inspire you to take your business to the next level.

Gavin Dow, Managing Director of Coffee Central

Coffee Central started 15 years ago and like many start-ups, my bedroom served as office and warehouse for the first few years. Gavin talks about how he grew his business from home

I was sharing a house with friends at the time so it really was limited to the bedroom. The smell of 500kg of freshly roasted coffee wasn’t exactly conducive to a good night’s sleep either!

I work from home because of the cost and convenience. Every business function was carried out on a budget, and it seemed crazy to spend money on storage and office space when I had a few square metres of unused carpet in my bedroom, a desk and plenty of stationary. It might sound a little ridiculous, but that’s exactly as it was.

As well as being cheap, it was also the quickest commute I’ve ever had! Although it would be nice to think this would translate into a few extra minutes in bed, it generally meant I was at work for longer.

It can also get incredibly lonely, especially during the early days when I didn’t even have any customers to take care of, let alone staff.

Initial tough decisions

The first couple of years I remember being very tough. Financially, I was somewhere between broke and just getting by. I recall on more than one occasion having to choose between beans and toast for lunch – I genuinely couldn’t afford both of them!

And this was at a time when my friends were all starting out on their careers and getting steady paychecks every month. Being skint at university along with everyone else is one thing, but being the only person with no money is much harder.

“On more than one occasion having to choose between beans and toast for lunch”

I’ve always invested in our website – I think our current one is the fourth we’ve had in about 12 years. Simply having a website is not enough, though. You have to make it work for you, and this usually requires outside expertise. There is a lot of hype around social media, but I don’t agree that it’s crucial for all businesses. Some of the largest B2B organisations in the US and the UK have zero Facebook likes and zero Twitter followers!

The secret of success

Luckily we’re in an industry that’s experienced healthy growth for some time now, and this has helped significantly. Growing a business in a saturated or competitive market has got to be a much harder thing to do, and I’d really think twice about getting involved in these kinds of industries.

Coffee Central now employs ten people, roasts 50 tonnes of coffee a year and looks after hundreds of coffee shops and restaurants all over the country. If everything goes to plan we’ll break the £1 million sales figure this financial year.

The coffee industry has been going through some very interesting changes – the specialist sector has really gained traction and we will be leading the way in the coming months.

As a result, we’ve had to reposition ourselves as a more specialist operator, and we’ve had to tweak our product range in order to do this. Now, the next 24 months looks very bright indeed – we’ve got everything we need to serve this new wave of coffee shop owners, and they know they can trust us to deliver.

There is no substitute for hard work. You still need a good idea, but without hard work, it will be a waste of a good idea.

Mags Walker, founder of Toolally

Mags talks about growing her home-based business

I began Toolally in 2015. I saw a huge gap in the market for statement yet easy-to-wear jewellery, so naturally I jumped at the chance to make beautiful accessories that celebrate women’s individualism.

I’m incredibly lucky (slash busy!) that this isn’t my only business; I also run a marketing and brand agency.

The decision to work from home basically boils down to cost and convenience. Everything is handmade and I could do it all on weekends, so I didn’t have to give up my day job which paid the bills.

It keeps set-up costs to a minimum and allows a fair bit of flexibility, but the big problem is that there is no home and work separation. Also, as the brand develops, space is difficult to find which means that recruiting extra staff is just not possible.

Early days in an exciting business

The early days were incredibly exciting, realising that people actually liked what you did. Each sale was a huge moment of celebration. The pace of change was very quick, responding to what customers wanted and adapting to that whilst staying true to my original vision.

We were lucky to be at the beginning of a movement in fashion jewellery and we had to stay at the front of that, which was actually extremely challenging – but the biggest challenge was responding to the fantastic opportunity presented by being taken on by the John Lewis Partnership.

We started with a trial in seven stores but were quickly rolled across their estate, and learning how to wholesale, how to design store packaging and how to source materials at that scale was daunting.

Growing a team from scratch in an area not known for fashion or jewellery making, finding a suitable premises and understanding the John Lewis supplier rules was something I had never done anything like before.

Coming from a marketing background I was lucky to have a fairly good understanding of what it took to raise awareness. We’ve done everything from building a website and setting up social media platforms to getting a PR representative early on and influencer gifting of product. We also found attending customer facing events useful.

Toolally started in 2015 and the turnover quadrupled in 2016, and again in 2017-2018. I’ve been very lucky that the growth has been very good and very steady.

Hopes for the future

I’m keen to expand more into Europe. I’m attending our first international trade show this September in Paris in order to make that happen.

I think the most important thing anyone needs when they start a business, wherever it starts, is a strategy and a plan. What is the ultimate goal? Why start a business in the first place? Is it a lifestyle decision or a dream of owning a globally recognised brand?

Once you set your goal, go for it. It takes hard work, tenacity, a willingness to listen to experts and recognise where you need help without losing sight of your goal. Be prepared to change if you are on the wrong track, stay as focused as you can and never give up. Be realistic about the investment you will need to make, not just of time but of money.

“The most important thing anyone needs when they start a business, wherever it starts, is a strategy and a plan”

In the early days, other than family, there are very few people who will help financially unless you are happy to give away a lot of your business and even then they are not as easy to find as it sometimes seems when you read about other success stories. It will take more money than your first business plan suggested so make sure you forecast prudently as running out of cash is never a good thing.

I have funded everything myself by having two jobs and working seven days a week, but when you love what you do and know where you’re heading it really doesn’t feel like work.

Craig Pannozzo is general manager of Gazeboshop.

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