There are definite savings when it comes to working from home, with cutting commuting costs likely being the most obvious. However, those who are venturing into the remote or telecommute worlds need to sit back and calculate the hard costs and the soft costs of setting up an office at home.
This is certainly not a finite list and each person will likely have to add or subtract a few items, but this a good starting point for things you must consider.
Hard Costs
A good quality computer and printer/scanner: This may seem like a no-brainer, but you cannot do business if you are spending your days cursing at lagging connections and diminishing storage space.
Also, since you now have no IT department to call on, you will need to get a good service plan if (when) something goes wrong.
High-Speed Internet Access: A fast broadband connection is as much a must-have as a good quality computer – cutting costs on communications will only hurt you in the long run.
Desk and chair: Working at the kitchen counter will only be fun for the first 35 minutes or so.
Communication technology and/or a landline: If your boss/customer can’t reach you, you won’t be very popular. A smartphone is another necessity that you cannot scrimp on – you need to have your office with you at all times. The increasing cost of data for running your business is a key consideration.
Software: The best thing to do for anyone setting up a home office would be to make a list of the software you have commonly used in an office setting and price it out.
Miscellaneous Technology and Devices: From routers to surge protectors, all of these items are important to keeping your equipment working smoothly.
Miscellaneous furniture: Even if you have a mostly paperless office, you will still need a filing cabinet, extra storage, and very likely a fireproof safe or box. You will also likely need a paper shredder for destroying sensitive and/or confidential documents.
The floor space: Whether it was a kitchen counter, bedroom, a playroom, or maybe even an actual office – that space is now your official work space.
Utilities: You have to factor in the added cost of you being there all day and, well, working.
Business services: If you have clients and or colleagues in your home you will need to be covered by insurance. If you are branching out on your own – you will also need business insurance.
Consider also; bookkeeping, accounting, legal representation may also be necessary.
Soft Costs
Analyzing the soft costs of basing yourself and/or your business from home is a necessary process everyone should go through. These costs are usually the ones that will be ignored until they become an issue, and by then it could be too late.
This is likely because most of the soft costs go hand in hand with working from a home office.
Out of sight, out of mind: Companies that allow staff to work remotely a few days a week are starting to see a downturn in productivity, and some have even withdrawn their ‘work from home’ or flextime policies. This is hard on those employees that do work hard from home and use their time productively. It’s difficult to prove to an employer that you are not just sitting around watching daytime TV when they don’t see you in your office.
I’m so lonely: Being on your own all day every day can get tiresome after a while. Although it certainly cuts back on distractions, many people find they miss the cooperative teamwork and office banter. People who work remotely can find themselves cut off from colleagues and miss out on work events, meetings, and sometimes even promotions.
The ‘Ah, they’re working from home’ effect: When dealing with a small business or a sole proprietor, it’s an unfortunate but true fact that most people don’t think a home based business is as professional as one in a traditional office setting. The general consensus is that if you can afford your own office, you’re worth the risk. Your home address looks great on a Christmas card, but does not look professional on a letterhead – and people can spot a home office address a mile away.
For example, when pitching for new business, the first thing a prospective client will do is do a Google search of your company. When the search shows that you are working from home, it could place a potential obstacle in your way. Even if they are lucky enough to make it through the pitch, people who work from home often find they are being offered less money for the same work that someone in an office setting would be paid.
Holding meetings in a coffee shop: The same is true with holding meetings in a coffee shop. If you don’t have a space where you can meet clients for confidential meetings, you may be passed over in favour of someone who can.
Fact is, you never know who is sitting next to you at a coffee shop. It could be a group of raucous teenagers, or it could be the competition.
There was a tweet making the rounds from a few years ago from a gentleman who was sitting in a coffee shop next to a group of ‘loud and rude’ people. After a great deal of discussion they hit upon a great name for their new company… and he bought the domain in revenge.
Safety: If you use your home address as your business address, you are opening yourself up to some real security issues, especially if you’re female. We don’t like to think about these things, but if people know you are home all day by yourself, it could pose a real danger.
Also, unless you have very secure internet, you don’t know who could be minding your business.
Having made this list, you may wonder why anyone would ever consider working from home. It is certainly not something anyone should jump into just to save commuting time.
There is an alternative, however, and whether you are a trusted employee tired of the commute or a brilliant entrepreneur setting out on your own, a serviced office can provide the professional atmosphere, safety, technology, and furniture needed for success.
In Burlington, Ontario, OnePlan Business Centres offers affordable office spaces that are professionally furnished and ready for you.