How to make a swtich from contracting to home business

[Gulliver]

Hi Guys,

I'm in the process of transitioning from contracting to home business. It's not easy.

My home business already earns the 20% of what I would need. One of the home business project is ebay and it could be potentially boosted in Dec due to xmas, other project are web maintenance and SEO and an eshop selling templates so these are not effected positively by the holidays.

Usually I had 2-3 week contracts, then 2-3 week working on home business. Obviously this cycle was not helpful for setting up the home business. for 2-3 weeks I was not able to work on home biz and so it suffered every time. Plus the mental switch also takes time. But I liked that at least every month I had the chance to work on my home biz. It kept it alive.

Now I have a longer 3 months contract and they want to extend it 5 months. The return commute is 3 hours door to door. Obviously, my home business suffered. I had to cease ebay trading as I have no capacity next to this contract. Only catching up with what I can at the weekend for the other businesses. I could take it an opportunity to earn a bigger chunk of money and then take off 9 months for home business?

The other thing I was thinking of is finding a job or part time job where I live. if I could reduce the 3 hours commute that would give me some time to do my home biz. Yes, I would earn much less and hate being employed but want to switch to my home business. And I'm ready to sacrifice. Part time job would be maybe better as my household income is also contributed by my wife. So if we wanted to keep it little tight a part time job would be sort of enough especially as my home biz is already generating 20% income.

What I really need to make home business working is time - which is scarce, and contracting - home business cycle kills it.

Any ideas or tips welcome.

[Murder1]

Can you not get someone else do the eBay stuff and cover their wages from the contract? Ideally you'd be contracting which I assume is earning more money until such a point that the home business provides enough income to allow you to stop.

[DirtyDog]

Negotiate a four day week with the client, and then spend that last day on the home business. If you can work on the home business so that in that one day you can generate enough income that you go above 20% income, then cut back a bit more on the contract...

If you stack up the money from the contract and then take 9 months off, you run the risk that you won't find work easily when you come back to contracting - worst case scenario is you plan your 9 months off, then when that is over, it takes a few months to get some more work etc.

Get married and get your spouse to run the home business?

[Eirikur]

Just out of curiosity as I'm planning to do something similar. Are you using the same Ltd company for your home business and for your contracting. If so does it affect the flat VAT rate (if you have one)?

[Gulliver]

Just out of curiosity as I'm planning to do something similar. Are you using the same Ltd company for your home business and for your contracting. If so does it affect the flat VAT rate (if you have one)?

I dropped the flat rate scheme. One of the reason was ebay, with the VAT on it's very difficult to do profit margins. Doing it from the same Ltd.

[Gulliver]

Negotiate a four day week with the client, and then spend that last day on the home business. If you can work on the home business so that in that one day you can generate enough income that you go above 20% income, then cut back a bit more on the contract...

If you stack up the money from the contract and then take 9 months off, you run the risk that you won't find work easily when you come back to contracting - worst case scenario is you plan your 9 months off, then when that is over, it takes a few months to get some more work etc.

Get married and get your spouse to run the home business?

The four day week is an interesting idea! Haven't thought of that one. To be honest, I hope I will not need to get back to contracting but I see your point with 9 months off. But normally I get contracts easily - I'm in demand

I'm married and we talked about she staying home and running it. The trouble is she feels she would not be able to run it. Ebay is selling vintage - you need to have the feel to buy stuff that will sell. The other projects she could run as it is not but she would most likely not be able to grow. Eg running SEO and adsense campaigns.

[Gulliver]

Can you not get someone else do the eBay stuff and cover their wages from the contract? Ideally you'd be contracting which I assume is earning more money until such a point that the home business provides enough income to allow you to stop.

Hmm, paying someone may not be the most profitable at this point, but I assume the someone could be my wife too. We are thinking about this option but there are buts see my reply to dirty dog.