09/04/14
Business
Self employment, the home based business, working for your self on your terms. If I had to define Freedom, it would be with two words: self employment. I'll let you in on a little secret, anyone could be self employed and anyone can make a living from their couch. You're probably like, how can this be? You can't be serious. So I can work from home, profitably without needing to go back to college? Yes. It's 2014 and if you're reading this, you obviously own an internet connected device. Now the truth is that self employment is easy, but not as easy as you might think. Actual work is still needed, dedication, persistence and patience are needed. You can't expect to wake up and be a work from home master, you need to educate yourself, but you don't need to go to college or anything.
What is so great about self employment?
-Well for starters, you have freedom. You can choose your own hours, you can work as little hours as you choose. For me, I can spend about 10 hours a week working and make $3,000. I'm not bullshitting you. 10 hours a week for me, broken down in 2 calender days is about 1.5 hours of photographing the items, 6 hours of listing the items, 1 hour of printing shipping labels, invoices and order records, 1 hour packaging the items, and finally 30 minutes driving to the post office to drop off the packages. (the last 2 hours and 30 minutes of work comes 7 days after I spent those 7.5 hours photographing and listing the items).
The week before Christmas 2013, I cherry picked some of my good stuff and I sold $840.28 in 7 days time, $270.50 was my profit.
-Time management, what you sell, how you sell it and pretty much every aspect of self employment other than when you need to file taxes and how much your life expenses are is all on your terms. You can work Monday and then not do anything until Friday. As long as you make enough money to pay the bills, you can do whatever you want.
-Taxes. Depending on the state that you live in, you wont need to collect sales tax if you sell online. In CT, from what I understand, I only need to collect sales tax on sales to residents of CT. If the buyer is in Vermont for example, I don't have to collect sales tax on that sale. Depending on your tax code and loophole knowledge, you probably can avoid paying some federal taxes if you fly under the radar. I've found that as long as you don't make a lot of money, the IRS wont notice you as easily but if you are making $8,000 a month, yea you should try to pay your "fair share".
What are the risks?
-You can go broke if you don't budget your money or if you don't sell enough. You should think of every sale as a commission based sale but where you only earn money if you sell something. If your monthly cost of living is $1,500 you should obviously want to make at least $2,000/month. That left over $500? Spend it wisely but guess what, you can spend it on your terms.
-You need to take initiative to provide for yourself constantly. I always need to make sure that I have enough inventory that I can sell. Right now, the price of Silver is very low at $19.60 or so per ounce and I have many ounces of bullion that I cannot sell until the spot price gets back over $27.00/oz. I will get more into bullion another time. If I can't sell something, it sits on a shelf or in a safe. Money doesn't grow on trees but dust accumulates on everything.
-When you deal in second hand items like Grandmas old Pewter knickknacks, you need to know what the fair market value of said item is and if it is even worth buying. Also, if you don't have cash to spend on new inventory, that is a problem.
-If you don't understand your market, you will risk everything and you probably will lose.
-There is not job security in the sense that you know that you are getting paid to work X amount of hours. You need to secure your own income and you are entirely responsible for the business that you want to build
My Experience
I am self employed and I've been doing what I do, successfully for over 5 years. I am a Numismatist aka a Coin dealer. I buy sell and trade coins, collectibles, antiques, oddities and outdoor/survival gear. I mainly sell on eBay but occasionally go to expos, trade shows and conduct direct sales. I personally know that working from home is not for everyone, being your own boss is hard work. Here is a list of some the things that I need to do:
-Photograph my products
-List my products
-Know and understand my products
-Track my inventory
-Track my costs, expenses, fees, losses, gains, sales, profits, purchases, quantities and personal income.
-File tax returns
-Understand the market and the client/customer base
-Know the current demand for my products
-Know the condition of second hand products
-Package and ship products that sell.
I also need to purchase all my supplies like:
-Printer paper
-Printer ink
-pens
-notebooks
-Polishes, tarnish removers, solvents etc.
-Bubble wrap, packing tape, boxes and bubble mailers and shipping label paper.
-Postage
-storage bins
Being self employed requires an investment of money. There are things that you need to buy in order to conduct business. Many of these items are one time purchases like a computer desk and some shelving. Because I sell on the internet, I had to purchase things like a shipping scale, a good printer and a quality digital camera. One of these days I'll buy an Ipad but I'm waiting for the post-holiday sales. When I buy an Ipad, I'll go over why it is the device that you need if you are self employed.
What do you need to start a home based business?
-Money aka working capital. I really shouldn't have to explain this one.
-Knowledge of what your business is, what you want to do and how you're going to do it.
-A good computer, an internet connection, a cell phone, printer and basic office supplies.
-An FEIN (Federal Employer Identification Number). Not really a requirement but worth having and it's free to obtain one through the IRS on their website.
-Customer service skills. Are you a people person who knows how to handle stupid customers or upset customers? You better be.
-Sales skills. You need to know how to "pitch" your item to potential buyers. I'll do more on this later.
-A PayPal account.
-An eBay Seller account or a website and domain. I have both but prefer eBay because I am familiar with it.
-Organization. You need to keep all your paperwork and records in a file cabinet or box. Your inventory and all your supplies should be organized as well.
-Communication skills. You will be talking, typing and texting people often. If you end up sounding like an idiot, you will loose business. Dn't tlk lyke dis err else u wont b getten ne shyt. Yea, don't be that guy.
At the very basics, those things are what I recommend you have. When it comes to educating yourself, buy books and read business and entrepreneurial magazines. I have price guides, how to guides and many other books that I need to conduct my business. Remember I said that I buy a lot of second hand stuff? That means I need to travel and meet with clients (people who have stuff to sell). Usually I find clients on Craigslist or through family member referrals. I have a nice, professional looking Pelican case that I use to carry my portable scale, a couple of magnifiers, precious metals testing equipment and other things. The Pelican case and a Staples portable file box with a price guide or two and other stuff go with me to every meeting with a client.
What you DON'T need.
-When you first start you, you don't need to buy things like business cards or advertisements. I started small and worked my way up the food chain. I didn't have businesses cards until my 3rd year of business, not because I didn't want them but because I didn't really need them.
-You don't need to quit your real job. I advise that if you have a job already, but want to become self employed, you should do both for at least 1 year before quitting your other job.
-You don't need to go to college. Business school wont teach you anything that $200 worth of books at Barnes and Noble wont teach you. I actually have zero college under my belt except for a Gunsmith degree and I now make over $30,000 a year.
Thanks for reading. I'll probably add more to this at a later time. Have a good one.
No comments:
Post a Comment