Self-employment (job) or business
A lot more people are starting Home Based Businesses instead of looking for a thankless, poorly paid part-time job. However it turns out that many of them are actually just creating their own jobs and not really building a business at all.
Unless you are super organised with a definite vision then you will probably be wondering whether to set up your new venture as a business or self employed job.
In simple terms a business is an asset, something that can grow in value and, if desired, can be sold.
Being ‘self-employed’ is basically saying that you have created your own
job, beyond what you are paid for either products or services you get
no long term value or benefit.
When starting out as a solo operator on a part-time basis most people will end up creating themselves a self employment situation anyway, whether it stays that way or not comes down to how they think of what they are doing and to taking the steps that lead to growth.
There’s nothing wrong with setting yourself up with a job that brings in needed extra income but if you want to eventually grow into an actual enterprise and reap the greater benefits then you need to start out with that as a mindset.
How you set things up and how you think about what you are doing will determine which way your venture will go. So you might want to give that consideration before starting anything.
Can I decide Later?
Starting out there’s no real difference whether you are self employed or running a business, the things you will need to do to set yourself up are going to be the same.
As I mentioned previously most home based businesses when they start out will go more into self employment mode and if or when they start to see some positive results for their efforts then they will start to think about growing the venture into a real business. In the 3 S Method we call this staging; starting small and growing bigger in stages.
One of the things about starting out to make money as a side gig is to not be too attached to your idea. I know that sounds somewhat counter inuitive but what I mean is if the people you were looking to as a target market do not respond by using your services or buy your product then stop doing it immediately.
The idea is to make money so be wary not to create an enterprise that you end up spending a lot of money on, thinking that if you buy better business cards or flyers maybe people will respond better. Those things shouldn’t matter too much if you are supplying a good service or product that your market appreciates and wants to use.
It’s not a matter of failure as much as it is about finding the right fit for you in the marketplace. That’s why I say don’t get too attached to your ideas unless you know for sure that what you are doing is what people want.
The Set Up
Like I said, at the start most people will tend to operate like it is another job and that is okay especially if you don’t really know what direction you want to take.
Once you have decided on what it is you will be doing the next step is to make sure you have the equipment necessary to perform the work involved. So if you are doing lawn maintenace you will make sure you have a mower and a trimmer and edger and what ever else is needed.
Then you need to let people know that you and/or your service is available, that’s promotion or marketing of the business.
The temptaion when starting out is to do things big, print lots of business cards and flyers/posters. The print shops love these folks.
If you are reading this article then I know you havea computer that you can use for DIY promotions to start. Every computer comes with some kind of word proccesser that will have templates for pretty well anythiing you will need.
Remeber what I said before about dumping the business if it’s not working for you. That’s why you don’t want to spend too much on hand outs etc.. Having printed promotional material is very important, you need to have something for people to learn about what you do, you just don’t need to use costly slick high production products.
Some of you will be net savvy and use social media like Facebook or Instagram and if you know how to work them that’s great however if you do not know how to use them then stay away, at least at the start.
The time it would take to master the platforms and then build a following would be lijke a small job in itself and unless you are chosing to become a social media expert stick with the simpler handouts. Some stores, laundromats and gas stations still have pin up bulletin boards, low tech low cost but effective.
If you decide that earning a few extra bucks is good enough then you probably aren’t going to look at incorparating instead you will do what ever it is you do to generate the money until your circumstances change then stop doing it.
However if you are looking to replace your current main income then you will want to look at solidifying the structure of your business and create a legitimate entity.
This is an important step in a small business’ growth and should be properly researched before committing to a course of action. Each State, Province or Territory has it’s own rules for incorporation some more relaxed, some more restrictive and some have different structures avaiable, find out about the jurisdiction you live in before you start the process.
Incorporation is not an absolute necessity you can run as a solo operator for as long as you like. However at some point you may find the protection of an incorporated company as well the tax advantages are something you need to grow even further.
Whether job or business you will still neeed to perform the work you have chosen to make money with. There is no point in making your window washing company an incorporation if you are only going out a couple of times a month and you usually end up spending the earnings within a day or so.
There may be limitations or disadvantages to incorporating. For example, the Province in Canada where I live now regulatges that in essence you become an employee of the company which means you have to do the whole payroll deal with Federal and Provincial tax remitences even if it’s just me in the corporation. That makes no sense for me at this time.
Now just because I’m not going to incorporate at this time doesn’t mean that I don’t treat my business like a business as opposed to a hobby. The main difference is attitude and how I think about what I am doing. I do think of my business as a business not a side job.
Someday I would like to sell my business, cash out. By treating my venture as a business and building it to have value and longevity that should not be a problem.
In The End
It comes down to what you want or need. Even if you are just looking for a means to an end financially I would still encourage you to make your own job as opposed to taking a heartless big box drone job. You never know where it will lead to.