One of the most popular ways to start a business is to pursue home-based business opportunities, especially online business opportunities. Whether you’re thinking about forming an LLC so you can work as a work-at-home freelancer, an Amazon seller, a home-based software developer or any other home-based business job, there are many ways to build a successful business out of your own home by selling your own products or services online.
According to survey data, U.S. home-based business opportunities are surprisingly plentiful and prosperous, so now is a great time to take advantage of starting your own business. Many home-based businesses are succeeding at a high level, and online entrepreneurs are changing the way that the business world works.
Here are a few home-based entrepreneur statistics for 2021 and some key insights into what these stats mean for you if you want to start a business. Is now the best time to jump into the entrepreneurial pool? It very well might be!
Home-Based Business Industry Statistics for 2021
Here are some interesting home-based business industry statistics to open up your eyes to a new world of business where YOU are in the driver’s seat.
There Are 15 Million Home-Based Businesses
SBA.gov estimates that almost half of small businesses are run from home. With 31.7 million small businesses, that means about 15 million are home-based. It's clear that starting your own business from home is more common than you might expect. Your neighborhood could be full of home-based entrepreneurs who are succeeding in business on their own terms, working from home and perhaps selling online.
And during the pandemic, the U.S. saw a record number of new businesses being started. Quarter 3 of 2020 saw a 49 percent increase from Q2. And where are these new entrepreneurs coming from? They were those who found themselves unemployed during 2020 and those who found themselves working from home. Starting a home-based business was a perfect match for meeting social distancing guidelines while still creating a source of income.
Half of Small Businesses Plan to Hire Staff
Around 49 percent of small business owners plan to increase their staff and hire more employees this year.
Don’t assume that a home-based business is somehow a fly-by-night organization that has less long-term potential. The fact that there is less overhead means you need less capital to get started and keep the business running. This might even mean that you have a better chance of long-term success than a typical brick-and-mortar business or retail storefront as you don't have a physical location to pay rent or a mortgage on. As long as you can keep finding customers, making sales and finding new business opportunities, your home-based business can keep thriving and growing for as long as you want.
Most Home-Based Businesses Cost Under $5K to Start
You might think that you need lots of money to start a business. And it’s true that having some startup capital is often a significant advantage — it can give you a safety net to use while you’re figuring out how to become profitable, even if you make some mistakes along the way. But most home-based businesses are started for less than $5,000. This is an optimistic sign that if you have a good idea and are willing to work hard, you can start making money while operating a business from home, even without a lot of startup capital.
Average Salary for Small Business Owners Is Over $68K
According to PayScale, the average income for a small business owner is around $68,000 a year. This can be encouraging news to those who are concerned about leaving their 9-to-5 job to be their own boss. Having a home-based business can provide you with even more money in your pocket as well, since you'll avoid business costs like office space, utilities, gas expenses driving to work, office supplies and more. It's been found that working remotely can save you $4,000 or more a year.
Women-Owned Home-Based Businesses Have Grown 114 Percent
According to Fundera, more and more women are operating their own businesses. There are 12.3 million women-owned businesses in the U.S. Over the past two decades, the number of women who have become business owners and entrepreneurs has grown 114 percent.
Before the pandemic of 2020, American Express statistics showed that in 2019 around 1,817 new women-owned businesses were started every day in the U.S. Why is this statistic important? Because it shows as we return to normalcy, you can expect to see the number of small businesses and home-based businesses rise again. Now would be a great time to take advantage of the opportunity and start your very own business.
This is also a sign that home-based businesses can be a good solution for women entrepreneurs who might have less access to startup capital or who might be juggling the obligations of work and raising children or caring for family members. Women often want more freedom and flexibility in starting a business, and running a business from home often enables them to have the best of both worlds — a substantial business income but with a flexible schedule.
Top 5 Insights from Home-Based Business Statistics 2021
Here are some key insights to give you some hope that 2021 can be YOUR year to get out there, start a home-based business and start building your dream.
1. Working remotely is preferred by entrepreneurs.
With 15 million home-based businesses in operation, working remotely is clearly a top choice. And during the pandemic, it was sometimes the only choice. However, even before the pandemic, 81 percent of people between 35 and 44 preferred working from home.
With the advent of the new remote work environments, you have the ability to work from anywhere, with your team, and grow your business on a very lean budget due to a limited overhead and removing the huge expense of owning or renting a commercial office space.
2. Opportunity is still available.
To say there is no uncertainty even a year after the pandemic hit the United States would be a lie. Many people are still cautious to go out in public. People are shopping online at increased rates for everything — groceries, clothing, fitness equipment, home improvement supplies, etc. For that reason, there is a massive opportunity for you to take your passion and service the market and scoop up market share while other businesses are still trying to save their business from an incredibly rough 2020.
3. Low cost of entry provides you with the ability to turn your dreams into a reality.
The fact that you have the ability to start a business with a very low cost of entry means 2021 can be incredibly profitable for you and the perfect time to propel your business in the marketplace quickly.
Before home-based businesses were a thing, starting a business often required putting your entire life savings and home on the line to try and make it work. Now, thanks to the internet, social media and a few thousand dollars, you can have your home-based business up and running in no time and start seeing revenue your very first day of going live.
4. Small business owners are happy.
Can you put a price on your happiness? Even during the pandemic, 43 percent of small business owners said they are “very happy” with their choice to start a business and become an entrepreneur and 31 percent were "somewhat happy." And 78 percent expected to survive the downfalls of the pandemic. Despite the pandemic, entrepreneurship and a home-based business can lead to happiness by being your own boss.
5. Even a small home-based business can have a HUGE impact.
Small businesses create more than 1.6 million jobs annually – and that’s just in the United States. That means as a whole, small business owners create 64 percent of all new jobs in the U.S. Talk about a huge impact on our society and helping cut back unemployment.
The year 2020 caused many people to lose their jobs due to cutbacks as well as businesses going out of business. There are millions of people out there looking for work and who can provide your business with a skill set that you don’t possess and that would take you too long to learn.
By employing people who can either work with you in your home or even remotely, you can help support families and provide them with a means to put food on their table and a roof over your head. You need to look at the bigger picture and your impact on the world. While running your business needs to be a focus, indirectly, you can help support families and your community at the same time.
Is 2021 the Year You Start Your Own Business?
Are you ready to start your own successful home-based business? Whether you’re doing business at home or away from home, it helps to set up an LLC or other business structure to protect yourself from liabilities and boost your business’s credibility. Check out our free Business Entity Comparison guide to learn about the differences in business structures and pick the one that best suits your needs.
Matt Weik is the Founder/Owner of Weik Fitness, LLC and is a well-respected fitness expert/author with a global following. He’s a certified strength and conditioning specialist, personal trainer, and sports nutritionist. His work has been featured in over 85 fitness magazines and over 1,500 websites. You can contact Matt via www.weikfitness.com or on his social channels found on his website.