Page 197 - Encyclopedia of Business and Finance

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Cottage Industries

Women operating a cottage industry munitions factory (ca. 1914–1918). © CORBIS

Home employment gives control of one’s life to one- Detailed record keeping is a must for the self-
self. There is freedom and flexibility in setting work sched- employed as well as the work-at-home person. Some
ules. Parents can be home for their children, there are no deductions are available only if the business is making a
commuting hassles, and no one looks over shoulders or profit, while others are used yearly to determine expenses.
determines break time. The individual, not the employer, Depending on the type of business a person wishes to
determines the work schedule. A parent has the flexibility become involved in, start-up costs need to be considered
of scheduling work flow around school activities such as and information gathered on the best equipment/tools
field trips and sports activities. necessary. Some businesses may require a starting inven-
tory, while others do not. When considering start-up costs,
DECISIONS TO MAKE one should shop wisely and consider purchasing used
equipment and supplies. This will save money for other
Despite all of the benefits, home employment is not for
expenses, and the depreciation on these items will be more
everyone. For example, those who start their own business
reasonable. Advertising, mileage expenses, cost of supplies,
must be able to generate work. There are advertising costs
involved in getting the company name out to the general phone, electricity, and entertainment are just some of the
public. Careful consideration should be given to the pos- expenses for which records must be maintained. Tax laws
sible advertising avenues to use. Advertising can be very can and do change frequently. The person who is unsure
expensive and may not generate enough business if it does about what records need to be kept should contact a tax
not reach potential customers. People who do good work adviser for detailed and up-to-date information.
but cannot get others to recognize this or cannot do well Another factor to consider before deciding to work
in promoting themselves may be spending more than they from home is motivation. One must be able to set one’s
are earning. own schedule and follow through on it. If a person is used

174 ENCYCLOPEDIA OF BUSINESS AND FINANCE, SECOND EDITION