What LIers should know about running a home-based business

Alice Hughes can’t remember a time in her life when she wasn’t crocheting.

A skill that many picked up during the lockdown, crocheting and knitting were hobbies Hughes learned from her grandmother. The Kings Park resident had lost her father in November 2018 and her husband soon after. "In 2019, after an impossible year, my brother convinced me to start an Etsy shop," she said. "I’ve always found knitting to be very soothing and therapeutic, so I gave it a shot."

She is among Long Islanders who have been doing business from home to support themselves, or supplement their income from full-time jobs, amid a pandemic that has put brick-and-mortar establishments out of business and people out of work.

Hughes and three Long Islanders share tips on running a home-based business, and what they have learned from being in the game at a difficult time, and experts offer advice for those considering a side gig.

1. Do it if you love it.

It was important for Hughes to continue enjoying her craft, only selling what she takes pleasure in making. She has no intention of making this her full-time job, but her shop, FrauHughesKnits, offers everything from hats, scarves and masks to gnomes, quilted ornaments and embossed soaps.

"I love making hats and the gnomes are ridiculously fun to create, too," she said of the crocheted creatures that are themed for holidays, football teams, and seasons. "I think people should be able to have something handmade without having to go broke to get it."

2. Know the rules, get your licenses.

By day, Hillary Reiter, 54, works as a hairdresser and Ira Reiter, 55, as a car salesman. By night, the Wantagh couple are personal chefs for man’s best friend. The Reiters started The Barking Biscuit LLC in January 2020, making homemade dog treats while giving back to rescues in need.

Their personalized, all-natural treats range in flavors from peanut butter and pumpkin bark to fresh mint bark, taste-tested by Riley and Graycie, the Reiters’ two rescue dogs. Prices range from $7 to $75 for everything from small bags of cookies to large baskets.

"Peanut butter is the most popular flavor and for a while we had a hard time finding peanuts and flour," said Hillary Reiter. "I contacted the U.S. Department of Agriculture to make sure we are licensed and insured," she said. "We try not to overdo it with flavors because there is a fee and everyone has to be registered."

The Barking Biscuit LLC does most of its business at markets. However, the pandemic meant more online orders, and contactless and curbside pickup. It also meant time to roll out some new treats.

"We have cupcakes, birthday cakes, and a vegan cookie, which is a softer cookie for those with dental issues. We try to accommodate everyone’s dietary needs," said Hillary Reiter, who believes that COVID-19 helped her business take off. "Everyone got dogs during the pandemic and were looking to spoil them."

3. Know your product.

Shivani and Amit Sharma were inspired by their cultural traditions of ayurveda — a natural, alternative system of medicine that originated in India — and the importance of a healthy lifestyle. In March 2020, the Westbury couple started PurnaTatva as a holistic and wellness business that specializes in dehydrated fruits and vegetables.

The idea was born a few years ago, when Shivani, 38, and Amit, 42, embarked on a journey to eat healthier, and after Amit purchased books on ayurveda. "He began reading these books and learned about the medicinal benefits of foods and spices and the technique of drying fruit. I immediately recalled my childhood in India eating dried apples," Shivani Sharma said.

"When shopping for produce, we would buy fresh fruit and it would go bad in a day," Shivani Sharma said. "We decided to try dehydrating fruits and vegetables, keeping everything preservative-free and natural as much as we can."

4. Know your market.

Levittown’s Al Soto is a self-taught craftsman, whose woodworking business, JAM Custom Crafts, came about a few years ago as a need to keep himself occupied while he was laid off after a local nonprofit youth outreach program he had established was defunded.

"I’ve always enjoyed working with my hands and creating and I like to listen to music while I create," Soto said, referring to his business’ name.

Soto, 31, researched ideas for crafts on Pinterest and also consulted friends and family and other crafters. "I didn’t know there was such a support system among small business owners," he said.

Soto’s most popular items are magnetic keyholders, bottle openers, and home décor signage. He enjoys creating items that "people can interact with, not just look at."

5. Have customers promote your brand.

PurnaTatva offers its products for sale on Etsy and a new website and promotes itself on all social media platforms but real marketing comes from word of mouth, Shivani Sharma believes.

"I want my customers to be my marketing, so it’s important to us that you try our product," she said. "I feel it shouldn't be a customer's responsibility to pay for shipping; it’s my responsibility to get it to you."

Some products made by home-based businesses on LI: Clockwise from top left, two sets of items made by Al Soto, of JAM Custom Crafts, in Levittown (photos by  Barry Sloan), and dog treats from The Barking Biscuit LLC in Wantagh (photo by Newsday/ Raychel Brightman); third row from left, hand-embossed double butter soaps made with Shea butter and mango butter, hand-knitted gnomes and a knit hat alpaca blend with faux fur pom from Alice Hughes (photos by Alice Hughes); bottom row from left, a mulling spice bag, wine lover's gift set and Valentine's  gift of pineapple from PurnaTatva, Westbury (photos by PurnaTatva).

Soto was already making creations for his neighbors and said that his advertising was all oral and visual thanks to many purchases by local customers, who would rather give him their business than a larger retailer. He previously listed his items on Etsy and Amazon, but was dismayed at the fees, shipping costs, and portions that online giants took from the seller.

6. Develop a business plan.

While some business owners are lucky enough to turn their passion into a success without a loan or funding, others are not.

To make your business idea a reality, you should have a plan "before you even decide the type of taxable entity the business should be and how to raise money," said Christopher Acheson, owner of The Acheson Group Inc., which specializes in employee benefits and financial wellness. "Your credit score is important and you definitely want it to be as high as possible because it shows your financial history, how much debt is outstanding, and if you pay your bills on time."

There are several options for financing. One is to use personal assets such as a savings or money market account until the business’ sales revenue covers all expenses. The owner may also consider borrowing money, Acheson said.

Another is to take on investors, which may sound overwhelming, but is actually easier than you think, he said.

"This type of financing is probably one of the most overlooked aspects of starting a business. When you take on a group of investors, you are not only raising capital, but taking on a board of directors, so picking the right people is crucial," he said. "These investors have a vested interest in your success and although you may have given up a percentage of your company to this group, you are buying access to their knowledge and networks, which could have otherwise taken years to develop."

7. Be aware of tax breaks.

Owners of home-based businesses should know of potential tax breaks.

"Individuals who have a home office can deduct a portion of their home expenses based on the square footage of the area they use for business," said Denise Gianotti, an accountant from a firm in Deer Park. "So, if you have a five-room house and you use one room as your office, 20% of your mortgage taxes and utilities can be deducted."

When it comes to choosing the appropriate taxable entity, CPA David Wolfson of Wolfson, Berbenich & Company CPA’s LLP in Mineola, emphasized that this aspect of business is often overlooked. "Many people tend to establish themselves as an LLC, but don’t know the difference between C corps, S corps, LLCs, sole proprietorships, etc., and this could have a drastic impact on the amount they have to pay in taxes," he said, recommending that business owners speak to a CPA before choosing an entity.

8. Give back to the community.

The Barking Biscuit LLC highlights and donates to a different rescue each month. Providing aid wherever they can, if the Reiters can’t help out financially, they give cookies and make baskets.

"We made over 700 goodie bags for all the ‘forgotten essential workers’ (those who are on overnight shifts in hospitals and nursing homes) and included a water bottle, snacks, ChapStick, hand cream, whatever we could get donated," Hillary Reiter said.

9. Have patience, but go for it

"I started to take it personally when business was a little slow so you have to have patience. You can get inside your own head," Hughes said. "But if you have a passion for it, just do it."

Shivani Sharma of PurnaTatva agrees. "To anyone who wants to really start a business, go for it," she said. "Be ready for failure, but be the phoenix."