17 Nov 2007
Should you be self-employed? Should you work for someone else? Find out the advantages and disadvantages of each.
Take the TEST to see if you could succeed as self-employed
Should you work out of your own home? What are your options?
Why is location so important?
One of the most strategically critical decisions you will make is where to locate your health practice. Experts say there are only three reasons why a business fails....location...location...location!
Actually, there are two critical elements that can make or break your success—poor location and lack of marketing. Simply put, if they can’t find you, they will go to someone else.
Whether you are working for yourself or are employed, in the health and wellness industry you have lots of options, including doing both simultaneously. Study the pros and cons of each type of business location or situation to determine the best choice for you. Then carefully and methodically search for your ideal place.
What are your options?
RENTING
Office space can be found in either retail or professional zoning. The rental cost is generally lower for professional use than it is for property zoned retail.
Retail commercial is the most expensive type of rental property. Rents are calculated on a per-square-foot basis. This means the number of square feet of the premises is multiplied by a value to arrive at a yearly amount. This is then divided by 12 months to arrive at a monthly rental amount. For instance, 1,000 sq ft. @ $16 per sq. ft = $16,000 divided by 12 months = $1,333 rent per month.
In addition to the basic rent, you may be charged common fees for your portion of garbage removal, maintenance and property taxes. This is also based on your square footage. You may also be levied a small percentage of your gross sales.
Once you have tentatively chosen a location, research the types of businesses that were previously located there. Find out how long each was in business, and why they moved or closed. The location, rather than poor business practices may have been the problem.
advantages: Direct exposure to traffic and pedestrians. Increased walk-in trade and decreased advertising expenses. This is ideal for retail operations. Prominent exterior signage is allowed. Convenient parking is generally available for your clients, although in some cases they may have to pay a parking fee. Business hours must generally conform to a standard, ensuring that clients know when and where to find you.
drawbacks: This is the most expensive type of location. Startup capital is required. Monthly overhead expenses are higher. You will have to pay property and business taxes in addition to rent. Common fees for garbage, snow removal and general property maintenance may also be required. In some cases, membership fees for a professional business association is also levied. These are all calculated on a per-square-foot basis. To keep expenses to a minimum, always choose the smallest space you can use without compromising your business operation.
Commercial telephone charges are mandatory. Insurance coverage is more expensive due to liability, the cost to replace the building, plate glass display windows, and fixtures. Staff may also be required.
Renovations and decorating costs will be high. This is because any building changes or improvements must conform to commercial building codes. Licenced master tradesmen are therefore required for any renovations, and building permits must be acquired. Fixtures, furniture and signs must also be purchased. Sign permits are required for any sign over 1’ square.
HOME OFFICE
A home office is located in your own home. Most municipalities now overlook zoning requirements and ignore a home-based business unless they receive complaints about parking congestion, signs, property neglect, excessive garbage, or noise.
If clients will be visiting you at this location, ideally you should have a separate entrance. At the very least, your office or therapy room should be near an entrance. Adequate parking is a must.
advantages: Complete freedom! You will set your own hours. You do not have to drive to work. Operating and startup costs are minimal. Commercial telephone lines are not required. Ambiance is warmer, friendlier, more inviting, promoting client rapport.
drawbacks: An office in your home or in a residential area may seem like it is free, but you will also earn a lot less. Home offices diminish your credibility and will not seem as polished or up-scale as one in a salon or spa. Therefore a home business may deter a small percentage of potential clients. Your professional fees will be lower, in accordance with your low overhead expenses.
You will need to be well-disciplined and motivated to keep business and family life separate. Set rules for yourself and your family. These will include the same privacy and respect that would be accorded you if your office was in a commercial location. Although you may prefer to work in your pajamas, dress professionally. This programs you subliminally to think and act more professionally. And you never know when a client might just drop by unannounced!
Parking may be limited. If neighbours complain of increased traffic and parking, or that your business interferes with the quiet enjoyment of their property, you will have to cease operating your business.
Signs and exterior advertising are not allowed. A sign with a maximum size of 1’ square is all that is permitted on a residential property. Therefore, you must spend more time and money on advertising, networking and public relations to attract potential clients.
Privacy is compromised. Clients will be using your own bathroom and walking through your home. Clients may call your home at any time. Your home telephone line may be used for business purposes, which may be an inconvenience for some family members.
PAY-PER-USE SPACE
Pay-per-use is office space is located in an existing business. Essentially, you are self-employed. You receive use of a room, plus use of a waiting room, business telephone, and receptionist. Utilities, concierge service to book your appointments, washroom, office, and furniture are included in your rental fee. You provide only the basic components of your service, such as massage table, linen, and essential oils. Rent is charged on an hourly, daily or monthly rate, or based on a percentage of your gross fees.
Chiropractors, massage therapists, salons and holistic centres will often rent space this way.
Retail sales may be conducted in the same manner. You pay a commission, or percentage of your retail price to an agent or business for sales made on your behalf. Commissions vary depending on the type of services and equipment provided for your use.
advantages: No startup capital or investment is required. You pay only one expense for your business. Concierge service, a waiting room, furniture and utilities are often included in the rental fee. Payment is based on a fixed percentage of your income. Therefore, income always exceeds expenses. No minimum amount of business is required.
Bookkeeping is kept to a minimum. This situation is ideal for someone who is just starting out and has no existing clientele, because the established business will often provide referrals.
drawbacks: Your success is dependant upon the success and competent management of the existing business. Unless otherwise arranged, your business hours are contingent upon regular business hours of the existing facility.
As success and clientele increases, it can become more costly than standard rent. A ceiling on the commission levied should be written into the rental contract.
NO FIXED ADDRESS
To operate your business with no fixed address, you simply use your clients' own address! Here are your options
Home parties Ideal for both retail sales or services. Home parties promote multiple sales at one time. An automobile is required. A cell phone or answering service is required.
advantages: No overhead. Expenses are minimal. You have freedom to choose your hours and availability.
drawbacks: You will have transportation costs. Income may be sporadic. You may have to spend quite a bit to advertise your business or rely on client referrals and word of mouth
Travelling services You travel to your clients homes or offices rather than have your clients come to you. An automobile is required. A cell phone is optional.
You can free-lance or sign up with a mobile service agency. Free-lance practitioners and professionals make themselves available through an agency. A central office books appointments and sends out the appropriate professionals as available. Some hotels use agencies and free-lance practitioners. A percentage, booking fee, or commission is levied on each appointment scheduled.
advantages: No overhead. Expenses are minimal. The agency advertises for you. You have freedom to choose your hours and availability.
drawbacks: Your own transportation is required. A cell phone or answering service may be required to stay in constant contact with the agency. You will be on call all the time. There are dangers in travelling to the homes or hotel rooms of strangers
Income may be sporadic. You have less control over the quality or type of client. If you free-lance without an agency, you will have to spend quite a bit on advertising, although this will be your only major expense.
PARTNERSHIPS AND CO-OPERATIVES
Partnerships and co-operatives are joint endeavours that unite the talents, expertise and efforts of two or more people toward a single cause or goal. This is an ideal arrangement if you lack financial resources or are particularly strong in one area but weak or deficient in other areas. There is strength in numbers!
For instance, you may be highly creative or an exceptional healer, but are a very poor business person or bookkeeper. Partnering with someone who has business expertise but is not creative, could be an ideal arrangement.
"Buddy" arrangements can also work for independantly owned businesses. Sharing facilities cuts expenses. For instance, a yoga studio needs the same type of facility as a dance studio. Since these businesses require a large floor area, rent can be expensive. Neither business requires constant use of the facility, which means full-time rent has to be covered by part-time use. Sharing the same facility can half your overhead, as well as supplement your client base through exposure to new clients.
advantages: Partnerships and co-operatives allow you to pool resources and share responsibilities and expenses. Ideally each partner has qualities that complement the other partner and strengths or talents that compensate for the partner’s weaker areas. The combined efforts of two or more individuals generally eases the work load, frees up more time to be productive, provides support and encouragement, and makes progress faster and easier, as long as each partner looks after their own responsibilities. Be sure to draft a contract to clearly outline each partner’s responsibilities.
Co-operatives provide a variety of services. This increases public appeal. Sharing expenses and overhead decreases individual costs to operate a business. This allows for larger and more attractive facilities with better equipment. Co-operative advertising allows for greater exposure at less cost to each individual. Partnering or sharing facilities with a complementary business can augment your own endeavour through referrals and spin-off business.
drawbacks: Personality conflicts can arise. Legal issues can arise. You are legally responsible for the actions, mistakes and financial transactions of your partner(s). You could end up doing all the work while your partner takes advantage of you. Your reputation could be damaged by your partner’s actions.
What to look for ...
The exterior front of your business represents your public face, the image you present to the world. It is your first line of advertisement and public relations. The facade is the first thing everyone sees before they enter your premises.
You can have the most beautifully decorated office inside, but if your your exterior has peeling paint, cracked sidewalks, weeds or neglected gardens, you will not project an image of success. While you have no control over it, neglect evident on adjacent properties will also affect your business image and your chances of success.
The right location for success requires an understanding of human nature. For instance, it is a well-known fact that businesses whose entrances face south receive more walk-in traffic than those facing north. This is because people prefer to walk on the sunny south side of the street. For this reason commercial taxes and rents are generally higher on south-facing properties.
Another point to consider is the vibration of the address. Add up the numbers until they form a single digit. For instance, if the address is 1481, the sum is 5. Now add up your birthdate. For example, if your birthdate is August 21, 1965, the numerical value wout be 8 + 3 + 3 = 5. If the numerical address adds up to the same numerical value as your birthdate, its vibration matches yours. Your chances of success and inner harmony at a vibrationally-matching location is far greater.
Does the building face into a T-intersection? Does traffic move quickly past it? Does the building facade look dilapidated, or old and tired? Are the windows small? Is parking available? Can you easily drive in and out of the parking lot without feeling endangered or stressed? Is the entrance wide and inviting? Is the building on a side street, or is it highly visible? Does it stand alone, or is it supported by other commercial businesses? Are there any vacancies in proximity to the building? Is it located in a low-income district? Will the building or interior require renovations? Does the building conform to building codes and existing by-laws?
Check for details such as doors that stick or won’t close properly, trees, shrubs or large objects obstructing a clear path to your door. Make certain hydro and plumbing are up to code. These renovations can be very costly.
Regardless of where you locate your business, be certain to clear the property of all residual energies from previous tenants and owners. Thoroughly clean, and freshen the property with paint. Use bells such as ting shas to raise the vibration. Smudge with sage to clear negativity and spray citrus or lavender essential oil into all baseboards. Or, sprinkle sea salt throughout. Then vacuum after a day or two. ~
(c) 2003 This article was excerpted from the A-Z business guide for Complementary and Alternative Health Professionals It contains everything in this website and MUCH MORE! Buy this book
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