More than half of all U.S. businesses are home-based. These firms are often dismissed as hobbies or part-time ventures with limited economic impact.
But our research shows otherwise. We estimate that about 6.6 million home-based enterprises provide at least half of their owners’ household income and together employ more than one in 10 private-sector workers.
The rise of the homepreneur is a long-term trend that will continue to accelerate over the next decade. Fueled by technology and enabled by low costs, businesses of all kinds are finding there is no place like home.
With a troubled but recovering economy as the back drop, here is our list of the Top 10 Homepreneur Trends for 2010.
1. The Job-Challenged Economy: Despite clear signs of economic recovery, job growth and traditional employment options will be limited in 2010. Employers will continue to be concerned about the economy, focused on costs and timid about hiring. Because of high unemployment and the lack of jobs, many will turn to self-employment and home-based businesses in 2010.
2. Bootstrapping: Bootstrapping was one of the most popular business terms in 2009, and 2010 will see continued small business focus on cost containment and cash flow. The obvious cost advantages of being home-based is leading to more small businesses – including employer businesses and high-tech start-ups – choosing to be home-based.
3. The Home-Based Artisan: Most think of home businesses as knowledge, commercial or office businesses. But a new do-it-yourself movement of crafters, digital tinkerers, green advocates and other “Makers” are using their garages, basements and backyards as their factories. These new artisans are combining digital technology and tools with traditional methods to create innovative products, processes and business models.
4. Cloud Computing: Cloud computing has been on our top small business trends list for several years, and its importance for home businesses continues to grow. Cloud-based IT services: (1) provide access to advanced computing capabilities on a variable cost basis; (2) reduce the need for IT infrastructure and support; (3) enable mobile computing, provide back-up and security services; and (4) improve collaboration with employees and customers. Simply put, the Cloud is a key driver of the shift towards home businesses.
5. Mobile Computing: Most home businesses are mobile with customers, suppliers, partners and employees located elsewhere. The growth of mobile computing provides home-based businesses with the tools needed to operate and manage a distributed business. 2010 will see more home businesses take advantage of smartphones, netbooks, location-based Internet services and other mobile services.
6. Social Computing: No trends list for 2010 would be complete without mentioning the growing importance of social computing. Facebook, LinkedIn, Twitter, blogs and other tools for collaborating with others and sharing information are changing business and society. Because social computing systems are generally cheap and easy to use, home businesses can effectively leverage these tools to amplify their business impact.
7. Analytics: Sophisticated yet easy-to-use tools are allowing home businesses to move beyond “gut level” decision making to data and information-based management. Online marketing tools in particular allow home businesses to develop sophisticated marketing programs once only available to large corporations. Analytical tools, often available through the Cloud, allow home businesses to successfully compete in a growing range of industries.
Social and Demographic Trends
8. The New Local Movement: New localism is a trend that has been in place for years. Driven by changing demographics, technology, rising energy prices and concerns about the environment, Americans are increasingly focusing on their families, friends and communities. Home businesses tap into this trend in two ways. Home businesses allow greater community focus for the owner, and benefit from market opportunities created by locally-oriented customers.
9. Boomers: Aging baby boomers are flocking to home-based businesses. Flexibility, interest in pursuing a new career or passion, and the opportunity for improved work/life balance all contribute to the growing boomer interest in home businesses. In some cases financial flexibility provide boomers with the ability to start a home business. For others, financial need drives the decision.
10. Work/life Balance: Interest in work/life balance is growing across almost all demographic segments. The Great Recession has increased the interest in work/life balance as more people focus on non-economic life issues. Surveys and other research show women, boomers and Gen Y in particular stress the importance of finding balance. Homepreneurs often cite work/life balance as one of the key benefits of home businesses. As this news spreads, so does the interest in home-based businesses.
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About Steve King: Steve is a partner at Emergent Research, a Senior Research Fellow at the Society for New Communications Research and a member of the Small Business Trends Expert panel. He blogs about small business at Small Biz Labs.
Thank you so much for writing this post. Since I am a Homepreneur myself, it’s especially important for me to see what my fellow home-based business owners/consultants are doing.
The Franchise King
Bootstrapping can definitely lead to efficient Business Success where you can start and grow a successful company with almost no money.
It is the little chunks like these that accumulate over time that can boost the economy on a quicker pace.
I find this discussion interesting because of the parallels I see between the homepreneur movement and the agrarian-based cottage industries that were prevalent before the Industrial Revolution. People making stuff in their garages & backyards and selling locally. Growing up I helped our family sell produce at a local farmers’ market and I love the sense of community that was generated.
Thank you so much for this post. As the Network Leader for over 5000 members I’m always looking for trends in the home business area.
Pat: I follow the Cose Home Business Network website. Great source of information on home businesses. For others that are interested in home businesses, go to: http://www.cose.org/COSE%20home%20business%20network.aspx
Robert: Agreed. We even call the broader trend The New Artisan Economy because of the similarities to pre-industrial times.
I will show this post to a friend who is a creating gold & silver handicrafts. I like the sound of “Home-Based Artisan.”
Technology is making the playing field more even as many solutions now include Fortune 500 level features – including inventory optimization like Phitch. Home-based businesses will compete more than ever with large corporations and more than half will be importing and exporting by 2018. Many would be surprised to learn that many home-based businesses have a warehouse of inventory in their basement – many with $100,000s of inventory.
we have seen a huge uptake in our home based mobile phone repair business training course, trainees have contacted us from all corners of the world to get our video based training package.
The reason it seems is that the large corporation controlled mobile phone repair offices have been downsized or simply closed to to cost cutting.
Now customers who have damaged phones are being told to just ” buy another one” by branded phone stores and network providers. This is unsuitable for most phone users as they get attached to their phone and store all personal contacts on it so the loss of the phone is a huge inconvenience.
These disgruntled customers are now seeking local small mobile phone repair businesses to fill this gap in the market.
Mobiles are the present preferred form of communication and in the future will be the main form of communication. Therefore the growth potential of this type of business is expotential.
submitted by M.Francis Sheppard
Thanks for keeping up with the research on this amazing trend. This whole category of business seems to be providing legitimacy to the very small end of small business. I love the fact that home based is a viable option and people can compete effectively from that base.
Thanks Steve for the interesting article. I’m also a home entrepreneur myself so I’m always interested in the trend and development of homepreneurs and have even developed a blog just for it – ehomepreneur.com. I believe we could make a impact to the economy as major companies and corporations are downsizing, the only way to save ourselves from losing job is to create job for ourselves.
I think big trend is cheaper business services, even some free. So many resources out there like zoho.com basecamp.com incaroo.com openoffice and even more.
Great article, thanks for posting the great research. This is a section of the economy that continuously gets over looked.
Do what you love and the money will follow….this is the best advice I can give to anyone who is seeking and without income.
I have started several businesses and I only managed to stick to one I love.
I certainly agree with the point you make in the technology section. I think more and more businesses will start shifting towards the cloud.
We actually wrote a post on business collaboration trends for 2010 as well: http://blog.agilewords.com/2010/05/trends-in-business-collaboration/ I think you might find it interestins, as it resonates with the points you’re making.
This article is exactly what I have been looking for. That for the article and the information. It’s really inspiring to see that the home based business world is booming.I really believe that this is the way to go. Your research has confirmed it. Thanks again!
I especially like #10 about work life balance. Gone are the days when working to death for an employer was seen to be a virtue!
John "Financial Freedom or Bust" Anderson
We need more Homepreneurs! As the population continues to grow, 9-5 jobs are increasingly scarce. Simple supply and demand.
And I definitely agree with Temi … a good work/life balance is critical. As the US is still a young culture, its interesting to see how the more established cultures (Italy, UK, etc.) strike that balance.
Great food for thought, thanks for the post!
Work/life balance is always going to be hard to attain. But we’re seeing a lot more firms – big and small – offering more work flexibility around where, when and how work is done. This at least helps with balance.
The At Home Decorator Training and Certification Program at http://www.redecorate.com has grown over the last 5 years thanks to women who love decorating and want a home-based business as well as flexible hours. After certification, some of the women choose to work full time; some part-time, especially if they have young children or are transitioning from other jobs.
We’ve trained hundreds of people who want to be independent “homeprenuers” and who don’t want to invest a lot of money in start-up costs.
There are fantastic possibilities today to make it all at home.
Thanks for overview. Now a year later, it seems to be true.