Self-Publish a Directory of Home-Based Businesses: A Home Business Plan

Promoting other people's bootstrap efforts can be profitable for both them and you!


| July/August 1983



Home Business Directory

The cover of one of the author's copyrighted directories.


PHOTO: DON VANDEVENTER

A few years back, my friend Paula Vineyard and I decided to venture into our own home business. When we looked into advertising the product we hoped to sell, though, my partner and I were amazed at the high costs involved. Expensive radio or television commercials were out of the question for us. So we checked into the possibility of a Yellow Pages listing, and discovered that (in our area, at least) the cost for the smallest entry was about $45 per month. One last bastion of hope was the community's daily newspaper. We investigated that avenue and sadly found that a 1"×2" display ad cost $14 for each insertion.

At that price it wouldn't take very long to deplete our entire advertising budget! In desperation, Paula and I did the only thing we could. We printed business cards, and left them posted on bulletin boards throughout the area. Then we resigned ourselves to sitting back and crossing our fingers hoping our customers would manage to find us.

The Dilemma of Home-Based Businesses

Sadly, during the winter of 1981–1982 our sales reached a dangerously low level, and we had to fold. My partner and I closed our endeavor on Friday, February 19, 1982 with exactly $14.60 in the company checking account. We had no jobs or business prospects. The future looked bleak.

Paula and I began brainstorming for new ideas almost immediately. Yet every enterprise we thought of seemed doomed to failure because of high start-up and promotional costs. It was then that we began to visualize a directory of home-based businesses. After all, we had learned (the hard way) that most self-run businesses simply cannot afford conventional advertising. So, we asked ourselves, why not come up with an effective solution to that problem, and capitalize on it?

We phoned our self-employed friends and acquaintances and asked whether they'd be interested in participating in a directory of home-based businesses. Almost everyone we talked with was enthusiastic about the project, so Paula and I sunk our last $14.60 in a small classified advertisement for the local newspaper to seek out other potential advertisers, and raced forward from there.

Well, it's been more than a year now since we printed and distributed our first Home Business Directory. In that time we've produced several such guides—covering four counties in northern Illinois—and are both making full-time incomes from our endeavor!

The Home Business Directory Plan

According to the Small Business Administration, the number of home-operated U.S. businesses is on the rise. Ten years ago, there were only 2.5 million such businesses. Today there are nearly 5 million, and estimates indicate that in another ten years there will be 10 million. With such a growing number of run-it-yourself operations springing up in this country, publishing a home-based business directory can provide you with an excellent part-time—or eventually full-time—income.

Exactly how much money are we talking about? Well, let's look at some conservative figures. If you live in an area with at least 35,000 people, draw 200 advertisers for your guide, and work 20 hours a week (over a period of four months), you should be able to make $2,500 profit from one directory. Cover larger areas, publish more directories, or attract more advertisers (while, of course, working more hours), and your income will rise from there!

And one of the biggest advantages of this income opportunity is the small initial investment. You can virtually start "on a shoestring," since any ads you sell are paid for as they are placed. Front money, then, is not a major requirement of this home business. Instead, it's much more important that you be a self-starter who likes people and is able to organize well.

Tips for Publishing a Directory of Home Businesses

First of all, you must remember this: If you collect ad money for a directory, and said directory is never published—for any reason—you'll have to repay every dime to your advertisers or else you'll be in deep trouble. (Angry advertisers and lawsuits are only some of the problems you'll have to deal with.) So be sure to finish what you start!

Second, it really does take a population of at least 35,000 to support a directory. But then, you don't need to limit yourself to just one town. Two of our publications covered whole counties!

Third—and I tell you this from experience—it's frightfully easy to spend all that ad revenue as it comes in without setting anything aside to cover the expenses of printing and distributing the directories. To avoid that calamity, deposit—from the very start—a minimum of 60% of all the money collected into a separate bank account. This should be enough to meet all your expenses, with any remainder earmarked as a bonus for a job well done.

My fourth bit of advice involves you, the law, and the IRS. You'll need to research and follow all local codes and ordinances regarding the setting up of a home business. (These restrictions will vary from place to place.) In addition, keep good records for income tax purposes.

And finally, you will in all likelihood meet people who will tell you on Monday that they want to advertise but who, when it comes to actually parting with the cash on Friday, will experience a change of heart. Don't be discouraged by those folks: They'll constitute a minority of your contacts. But likewise, try not to rely heavily on verbal agreements.

How Much to Charge

We've found that in a small community with a population of 35,000 to 75,000, a rate of $25 for a six-line ad is reasonable. And $30 for a similar ad is a good price to charge in more populated areas. Of course, you may discover that an advertiser will want to publish ads under several different categories. So, by giving a price break for multiple entries, you may well encourage your clients to spend more money.

This is our rate schedule, which you may want to use as a guide:

Smaller Community
First Ad: $25
Second Ad: $20
Three or More: $15 per additional ad

createbook
4/17/2016 4:57:26 PM

Wonderful article. Always interesting to see an initial failure evolve into a success. My business partner and I have been operating a self publishing company from home for the last 2 and a half years. We would be happy to answer any questions from fellow entrepreneurs or give a free consultation to directory publishers looking for an ebook presence. http://www.createbook.org Patrick@createbook.org 877-393-8444






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