Small Business

The argument for running your business from home

Co-working spaces and coffee shops are great, but there are way more perks when it comes to conducting business out of your place of residence.

When Alex Wilkins started his business, Wilkins IT Solutions, eight years ago, it quickly became clear that the spare bedroom wasn’t going to cut it as an office. “I realized I needed a more professional space,” Wilkins says. “It was difficult trying to work on the same floor as our sleeping baby.” He soon moved his office into the basement, where he could have a secluded space to work on projects and take client calls without disturbing the kids.

Before starting his own company, Wilkins used to commute from his home in Oshawa to an office job in Toronto, spending hours in his car each day. But once he started his family (he now has two kids, ages three and six), working from home turned out to be a much better alternative for the entrepreneur. “Your schedule is more flexible; it’s easier to duck out to take your child to the doctor during the day,” Wilkins says. Plus, not having to commute means he has more time to spend with his family.

That’s one of the main benefits of running your own business from home, says Chris Castillo, a business professor at Algonquin College, and CEO of Master Entrepreneur International Inc. “You also get to save rent money that would otherwise have gone towards paying for a co-working space. That money can instead be invested back into your business,” Castillo points out.

When it comes to establishing a home workspace, Castillo emphasizes the importance of having a business area that’s separate from the rest of your home. “The area needs to be clean, organized, tidy and relaxing. Your number one goal is to make your clients feel comfortable and at ease about coming to your home-based business,” he explains.

That’s exactly why Wilkins and his wife (who often works from home herself) recently hired a contractor to renovate the basement. They’re now able to host clients for meetings in a more polished setting, complete with a mini fridge and coffee station.

It’s also important to make sure your insurance is up to date once you decide to establish a home office. Wilkins’ first tip is to ensure you fully understand what your existing home and auto policy covers. For example, business use of an automobile does not automatically protect you if you’re transporting clients to a meeting or event, even if it’s just a one-time favour.

The most important thing you need to consider is whether or not you have the right coverage, says Kim Neilly, vice-president of corporate development at Surex, an online insurance brokerage based in Alberta. “If you’re going to be doing simple work from home, where you don’t see clients and log in remotely, it can be as easy as adding a rider to your insurance for a small annual fee,” she says. “Sometimes there’s no fee at all—it depends on the company you’re insured with.”

Weighing the risks is also crucial; if you’re going to run a hair salon or microblading business from home, there’s a much higher risk of injury or error, so you’ll likely have a harder time finding a personal lines policy that will cover you. “You may need to get a commercial general liability policy (CGL) to ensure you’re covered,” explains Neilly.

You also need to consider materials: Do you work with supplies, samples or merchandise that needs to be insured? “Most companies only cover you up to a certain maximum, usually between $2,500 and $5,000, so if you have an expensive computer, you may need extra coverage,” Neilly says. And, of course, make sure you’re covered for additional liability exposure: “Having clients entering and exiting your house and working with chemicals are additional liabilities, so you need to be covered in case the unimaginable happens and you get sued.”

After you’ve made sure you have sufficient insurance coverage and your business is starting to take off, it’s all about making sure you maintain your work/life balance, says Wilkins. “When work is done, put down your phone and your laptop and enjoy yourself,” he says. “You won’t be able to shut down at 5pm every single day (after all, you’re a busy business owner!), but you don’t want to find yourself working 100 hours a week just because your desk is 20 steps away.”

Castillo recommends establishing a schedule for yourself, including hours of operation. “You need to know when the office is ‘open’ and when it’s ‘closed’,” he says. Block off times in your calendar for administrative work (responding to emails, etc.), client meeting times and project deadlines and breaks where you can work out or go for a walk. “The simple act of getting out of your office space and into other spaces is important for your mental health.”