Home Business – The Good, The Bad, and The Possibilities

Home Business – The Good, The Bad, and The Possibilities

A recent blog post asked whether it was time for your home business to move out. This likely resonated with many small business owners who operate out of the home and who may be growing out of the home business model. So, what if you are not ready to plunge into Denver’s highly competitive commercial real estate market? What if you are uncertain about your business’s potential for profit vs. the added expenses of leasing or buying an office space or storefront? There are other hybrid options that can keep you running your business from home while leasing or sharing space for your growing needs without breaking the budget. This post will discuss the good, the bad, and the possibilities for your expanding home business. A small business attorney will help you decide what is right for you now and in the future.

Why Your Small Business Should Stay at Home

The perks of working out of the home are well known. Among the top advantages are versatility, flexible schedules, low overhead costs, and increased value of your home. If you have been successfully operating this way with little to no legal hiccups – permits, forms, insurance, licenses, etc. – then you truly are at home. Plus, if you are in the start-up years, this may be the most cost-effective way to work. Another very beneficial pro of working from home is less commute time, which translates into more revenue-producing time. According to a Forbes article, the flexibility of working from home allows you to scale up or down more quickly, hiring more or fewer people, or working longer or shorter hours to right-size your business operations. Furthermore, you are able to work as late into the night or as early in the morning as it suits your family and schedules. Other benefits include tax breaks, reduction in fixed costs, and the ability to test out products or services before investing heavily in commercial space. Your small business attorney will help you from choosing a legal structure to securing and registering domain names and trademarks.

When Your Small Business Needs to Break Free

It may suit your clientele fine to conduct coffee shop meetings, but this may change as your business grows. You may need larger, quieter, or more private venues for meetings and presentations. Work-life balance and the space you designate in your home for business may become more challenging as the demands of your growing business increase. Vendors may not be able to deliver large shipments to your small garage. Restrictions from zoning regulations can impede you from adding separate structures to your home and even from displaying signs or allowing employees and customers to park. The lack of a more professional business location may limit your credibility and customer base. A small business attorney will help with your home business transformation from deciding if it is time to expand beyond the home to changing the way you do business.

Where Else You Can Conduct Business

If the prospect of spending $25 per square foot for office space in Denver is out of the question, there are other possibilities. Whether you are a startup or an established home business, you can find less expensive alternatives to traditional office leases that fit your needs.

  • Temporary Office Spaces – These are spaces available just for those times when you need to meet clients face-to-face in a professional setting.
  • Coworking Spaces – These also allow you to rent space for a certain number of days each month and often offer conference rooms or even amenities like fitness center access and networking events and workshops.
  • Executive Suites – These are custom-built spaces that allow you to grow. Even a small space can give you access to amenities, such as shared conference rooms and break areas with other small business owners, a lobby, a receptionist, and in some locations, administrative help.

If you need help with your growing home business, contact me, Elizabeth Lewis, at the Law Office of E.C. Lewis, P.C., home of your Denver Business Lawyer. Phone: 720-258-6647. Email: elizabeth.lewis@eclewis.com

Contact Us Today

Law Office of E.C. Lewis, P.C.
Your Denver Business Attorney
501 S. Cherry St., Suite 1100
Denver, CO 80264
720-258-6647
Elizabeth.Lewis@eclewis.com

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Is It Time For Your Home Business To Move Out?

Is It Time For Your Home Business To Move Out?

The rapid pace of Colorado’s economic environment is both alluring and daunting for small business owners. Consistently ranked at the top for everything from best city to live in (Denver) to technology and business, Colorado is not only attracting people, but it is also bringing in major retailers from around the globe. According to the U.S. Census Bureau, Colorado’s population grew by nearly 200,000 between 2014 and 2016, reaching more than 5.5 million. This boom has created a robust business climate and economic opportunities for entrepreneurs of all shapes and sizes. There are nearly 600,000 small business owners in Colorado despite rising real estate and cost of living rates. While you may have started as a home business because of these rising costs, there may come a time when you must expand beyond the home. This post will cover five reasons to move your business into a retail or office space. A small business attorney can help you make the right decisions for the future of your home business whether you stay where you are or move.

Moving your small business outside of the home is a major decision with a host of added expenses. Rent, agreements, utilities, cleaning and maintenance fees, movers, equipment, furniture, gas, taxes, and permits are just some of the overhead costs and regulations that will differ from your home operations. However, there are many benefits. Entrepreneur magazine discusses some of the arguments for giving up your commute to the spare bedroom.

1. A Growing Business Requires More Space

If your business is thriving, you have no doubt experienced some growing pains. Depending on the nature of your product or service, more customers can lead to storage and space issues. This is further complicated if you need additional staff. Unless you are willing and able to renovate your home to accommodate your expanding needs, you will likely have to rent outside space. In some cases, zoning laws prohibit you from having more than one employee in your home business.

2. Rented Space is Perceived as More Professional by Some

Clients may already come to your home office, which can be a bit of a juggling act when you are trying to portray a professional image. There may be a much broader audience you are not reaching – an audience who is deterred by or skeptical of the home setting. For those potential clients, a larger commercial space instills consumer confidence. The increased revenue from this larger client-base should eventually exceed the costs associated with renting outside space.

3. You May Not Want Non-Family Employees in Your Home

Having staff members in your home, especially if you have a large family or young children, may not be ideal. Unless they work virtually, it can even be difficult to hire the type of employee you are looking for. While a casual, flexible atmosphere is enticing to some, others have a bias associated with home business settings.

4. Your Home Has Too Many Distractions

It can be difficult to stay on task. The perks of making your own hours and dress code can also lead to an informal attitude and procrastination. It might take leaving the home to instill a more focused, productive work ethic, especially with piles of laundry or dishes taunting you in the other room. The demands or interruptions from family members will also lessen without your constant physical presence to which they have become accustomed. Moving into a retail or office space could restore your work-life balance.

5. Working Outside of the Home is Stimulating

Humans are social creatures, and working from home can be lonely. Without the stimulation of colleagues or peers, creativity and progress can be stunted. Even if you cannot afford a larger commercial space, co-working spaces provide lower cost options. If you find yourself easily distracted by isolation, overcompensating by doing housework, running errands, or visiting with neighbors, it is time to move out.

In a community of small business owners, networking and support abound for your growing home business. Everyone, including your competitors, want to see you succeed and stay in Colorado. Financing and grant opportunities are available through the U.S. Small Business Administration District Offices, and there are dozens of development centers for small businesses throughout the state. If the future of your business rests on expansion, but you are still not ready to relocate, there are ways to make it work. You are, after all, your own boss and landlord! If you need to hire employees, perhaps you can hire other free agents or ask that they work remotely. Storage facilities may offer a solution to your overrun piles and stacks. Business centers are temporary offices that provide space and amenities, like meeting space, office equipment, and receptionists. A small business attorney will help you decide whether it is best to stay or go and adapt to your changing needs.

If you need help deciding what to do with your home business, contact me, Elizabeth Lewis, at the Law Office of E.C. Lewis, P.C., home of your Denver Business Lawyer. Phone: 720-258-6647. Email: elizabeth.lewis@eclewis.com

Contact Us Today

Law Office of E.C. Lewis, P.C.
Your Denver Business Attorney
501 S. Cherry St., Suite 1100
Denver, CO 80264
720-258-6647
Elizabeth.Lewis@eclewis.com

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What’s in a Name for Your Home Business?

What’s in a Name for Your Home Business?

Your home-based business may be something you have been dreaming about for a long time, or it may be the result of a lay-off or need to supplement your existing income. Being your own boss, making your own hours, and having endless possibilities for growth are just some of the many perks. Whether you are a designer making custom jewelry or a freelance programmer looking to expand your business, you will need to consider all of the legal, technical, creative, and minute details of starting, protecting, and broadening your home business. Small Business Attorney Elizabeth Lewis will not only help keep your business legally upright, but she will also help with the things you may not have considered. This post will cover three often overlooked areas of home business planning:

  1. Choosing a Name
  2. Choosing a Legal Structure
  3. Choosing an Address

1. Choosing A Name For Your Home Business

Coming up with a name can be the easiest and most fun start to your home business. Testing out names on your family and friends and drafting logos are an exciting part of the creative process, but there are important steps to take before you settle on a name or establish a brand. Your name should identify your products/services, be memorable, and stand out. If it is too generic – Denver Jewelry – it may be difficult to register or trademark. If it is too narrow – Carla’s Breakfast Cupcakes – it may inhibit or restrict the growth of the business. The name should match the spirit and purpose of your business and inspire your logo and marketing. But first… make sure it is available. Before you do a national trademark search, check with the Colorado Secretary of State’s Office. You can register or reserve your trade name online on the Secretary of State’s website. The Denver Public Library also has resources, like trade name searches, for small business. It is also important to secure a domain name for your website. Your small business attorney will help with both the legal aspects of your home business name as well as your online marketing presence and, if needed, refer you to a trademark attorney to help secure your name.

2. Choosing A Legal Structure For Your Home Business

The structure of your business impacts many other decisions, affecting your liability, taxes, permits, and licenses. You might start doing business as a sole practitioner, but later decide to become a limited liability corporation (LLC) or an a corporation. Operating as a corporation can give you legitimacy that you may not have as “some guy who works out of his house.” With an LLC or Corp, you may be able to protect your personal assets from creditors, avoid paying both personal and corporate taxes, and deduct pre-tax expenses (e.g. travel, computers, phone bills, advertising, and health care premiums). Here are some pros and cons for LLC versus a corp.

Pro LLC

  • easy to set up
  • inexpensive to start
  • less red tape than forming an S corp

Con LLC

  • required to pay self-employment tax on income generated in the LLC
  • must operate the LLC distinctly and separately from personal affairs

Pro Corp

  • profits after payroll expenses, federal taxes, and FICA can be distributed to owner and are taxed at a lower rate than income if s-corp status is chosen

Con Corp

  • stricter tax code guidelines than LLCs
  • costs more to form a Corp
  • can have additional state taxes

Make sure you know the difference between the tax status and legal status of your entity though. For example, a LLC or a corporation can be an “s-corporation” as s-corporation just means you have elected to be taxed under subchapter s of the internal revenue code. If you are an LLC taxed as an s-corp, you may have many of the restrictions (and costs) of a corporation.

Because each state has its own rules, a small business attorney will help you choose both the best legal and tax structure for your home business and, with the help of a CPA, make sure you remain compliant with Colorado’s tax, licensing, and permit laws.

3.

Choosing An Address That Isn’t Your Home Address (And Why It Matters)

There are so many wonderful benefits of working from home – having clients or customers know where you live might not be one of them. For LLCs or Corps, a registered agent’s address can be substituted for your own. However, if you are not incorporating, you can get a P.O. Box or use a “Doing Business As (DBA)” mailing address. These are options if you would like your personal residence to remain private or if you live somewhere, like an apartment complex, you fear will come off as unprofessional. There are home address alternatives. A mail-receiving service can provide a street address and a suite number rather than your actual address or a P.O. Box. These mail service companies will also pack, ship, and track your packages. An email account will further reduce the volume of mail and phone calls you receive. Whichever address you choose for your home business, remember to respond to all inquiries promptly and establish an efficient system. This will keep your operations running smoothly and your customers satisfied.

Another issue relevant to your home address and your home business is how your address appears to listing services such as Google My Business. If you don’t want you home address with a map to your front door being displayed, make sure you double check and correct how your listing is shown.

If you need help setting up or keeping up your home business,
contact me, Elizabeth Lewis, at the Law Office of E.C. Lewis, P.C., home of your Denver Business Lawyer. Phone: 720-258-6647. Email: elizabeth.lewis@eclewis.com

Contact Us Today

Law Office of E.C. Lewis, P.C.
Your Denver Business Attorney
501 S. Cherry St., Suite 1100
Denver, CO 80264
720-258-6647
Elizabeth.Lewis@eclewis.com

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