Bolstering home-based businesses

Neighborhood leaders reaching out to residents who work out of their homes

After years of focusing on storefronts, the Nicollet-East Harriet Business Association (NEHBA) is turning its attention to Southwest’s thriving culture of home-based businesses.

In 2010, out of NEHBA’s 112 members, only eight were home businesses. NEHBA leaders are brainstorming this month about how to get in touch with sometimes-elusive home businesses, inform them about the potential benefits of joining the association and gather feedback to help the association develop programming that would more directly aid home entrepreneurs in the future.

Southwest home businesses are remarkably plentiful and active. Last year, NEHBA board members Dwight Cody and Roger Worm conducted an analysis that determined there were approximately 203 home businesses in NEHBA’s service area. Those businesses were estimated to do about $36.5 million in annual sales.

By comparison, the same analysis determined there were approximately 137 storefront businesses in the area accounting for $53.3 million in annual sales.

“With the estimate we have of the number of home-based businesses in the service area, you can see why we are making outreach to them a priority this year,” said NEHBA President Matt Perry. “The challenge is figuring out how to connect with them when there is not an actual storefront to go up and knock on to introduce ourselves.”


Helping home businesses thrive

In addition to serving as NEHBA president, Perry runs Twin Cities PC MD, a home-based computer services business. He believes his experience is instructive for other aspiring home-based entrepreneurs and illustrates how NEHBA might be able to help non-storefront businesses.

Perry founded his business in the mid-1980s. At first, he reached out to prospective customers via print advertising in local newspapers. He said he “couldn’t have got started” without the boost the ads gave him, but added that networking has been most crucial to sustaining his business over the past quarter-century.

“What really helped get the business going was referrals from other people,” Perry said. “Cross-pollination is super critical.”

Of course, most new home-based businesses aren’t launched with a well-developed network of clients already in place, and it can be difficult for fledgling companies to afford advertising. This is where Perry believes NEHBA can help.

In exchange for the $100 annual fee, the association develops a web presence for member businesses on the Experience Southwest business directory (experiencesouthwest.com). Less tangibly, membership provides important networking opportunities with other Southwest entrepreneurs at NEHBA meetings and events.

Cody recently landed a job as an accountant for Wipfli LLP, but he previously worked from his East Harriet home doing accounting work as an independent contractor. As is the case with many home entrepreneurs, he said his choice to work from home was mainly about lifestyle.

“I could ride my bike to meet clients, be available to take care of things around the house and look after my kids,” Cody said. “That’s the attraction for many people.”

But working from home presented challenges. Cody didn’t have access to a professional office space where he could conduct meetings, and this posed problems when clients wanted to bring their attorneys and meet in a quiet, private setting.

“Strategically, it wasn’t the right model,” he said, though he added that he only resumed working in the corporate world because he “received an offer [he] couldn’t refuse.”

In addition to lacking access to office space, other problems frequently encountered by home entrepreneurs include difficulty affording insurance, legal counsel, technologies and access to credit.

These are all areas where a business association like NEHBA might be able to help home businesses, but discussions about precisely how have yet to occur.

Kingfield entrepreneur Karla Hill-Donisch runs a customized training business named Hill & Company out of her home. She recently joined NEHBA because of the networking opportunities membership provides, but she also wants to encourage the association to do more to help home-based businesses.

“Could the association make a collective that would possibly provide insurance? Create a credit union, provide resources like that for small businesses that are more costly on your own?” she said. “Right now, there are really more questions than answers.”


Forging stronger connections

NEHBA isn’t the only Southwest organization focusing on home businesses this summer.

Kingfield Neighborhood Association (KNA) Executive Director Sarah Linnes-Robinson said home entrepreneurs often contact her asking whether the neighborhood can do anything to facilitate networking.

“We are realizing that there are a lot of (home entrepreneurs) out there and a lot of them are lonely,” she said.

In an effort to help home entrepreneurs connect with each other, Linnes-Robinson organized an informal forum last month for home-based businesses during the Kingfield farmers market. She said she plans to meet with some of the attendees this month to gather feedback about what else KNA might do to help.

NEHBA is reaching out as well. Cody said he plans to distribute fliers in Southwest neighborhoods this summer encouraging home entrepreneurs who have slipped under the radar to get in touch with the business association.

“Trying to figure out what a home-based business needs and what a business association could do for them — that’s the struggle,” Hill-Donisch said.