Home Sweet Home Office

By KAREN KAPLAN

March 19, 1996 12 AM PT

SPECIAL TO THE TIMES

There’s no place like home.

That’s what millions of small-business owners are discovering, as crisis, choice or chance prompts them to launch and operate companies out of home offices.

Starting a business at home may be an economic necessity if capital costs are mounting and the added expense of office rent would be too much to bear. But a growing number of entrepreneurs say that once they become accustomed to working at home, they have no desire to return to a traditional office setting.

“I really like working out of my home,” said Steve Dworman, who began publishing the Infomercial Marketing Report out of his Brentwood residence in 1991 and now grosses just under $1 million a year. “I can work a lot more effectively because I don’t have a commute, and I can afford a nicer home with a lot more space because my offices offset part of the cost.

Partly the result of corporate downsizing, and aided by computer technology that keeps getting cheaper and more powerful, an estimated 46 million people like Dworman with home offices are challenging the stereotype of what it means to “go to work.”

According to IDC/Link, a market research firm in New York, nearly 13 million Americans operated full-time businesses from their converted bedrooms, porches and garages in 1995. Fourteen million more had part-time home businesses, and 8 million telecommuted from home offices. The rest use their home offices for work they bring home with them.

Paul and Sarah Edwards, the Santa Monica-based gurus of the trend, were among the first to recognize the benefits of working from home. Sarah resolved to open a home office after a stress-related kidney infection landed her in the hospital in 1969.

“I was trying to be a supermom,” said Edwards, who at the time was working with a regional Head Start program in Kansas City, Kan. “I loved my career and I loved my family, but the doctor said I had to change my lifestyle.”

After getting a master’s degree in social work, she opened a psychotherapy practice in her living room. Her husband, Paul, followed suit a few years later. Fed up with office politics, he started his own political consulting firm and set up an office in downtown Kansas City. But each day he would leave the house later and later, until he finally realized he could work just as well from a spare bedroom and save substantially on his overhead.

“It took several years for our relatives to take us seriously,” Sarah Edwards said.

Being taken seriously is no longer a problem for them. After moving to Sierra Madre in 1976, they gradually began spending less time on their original businesses and more time acting as consultants to the growing legion of home businesses.

In the Edwardses’ current home, a stylish condominium in Santa Monica, just over 20% of the space is given over to their business-- including a downstairs bedroom converted to an office, a former hot tub room now filled with filing cabinets, and a loft that is home to both their desks.

From there, the couple write books about working from home--six have been published so far--answer electronic mail on their “Working From Home Forum” on CompuServe and prepare for their weekly radio and cable TV programs. (Neither airs in Los Angeles.) They have also launched a site on the World Wide Web (https://www.homeworks.com) to help others succeed in starting home-based businesses.

“As the corporate pyramids have flattened out into pancakes through downsizing, the way in which people work has changed, and that allows more people to work from home,” Paul Edwards said.

The rise of affordable, powerful and easy-to-use personal computers has played a big role in making that possible. Manufacturers of computers, copy machines and other office products began targeting the small office and home office market (often dubbed SOHO) in earnest about two years ago, when their traditional corporate customers started scaling back and they had to look elsewhere for business.

With the help of PCs and software tailored specifically to SOHOs, home-based businesses can run as efficiently and professionally as large corporations. With fax machines, modems, photocopiers and laser printers, they can keep up with any company without taking up lots of space.

New technology such as the Internet also make it easier for small and home-based businesses to compete because it allows them to reach millions of potential customers inexpensively.

“This is a technology-driven phenomenon,” Paul Edwards said. “Plus, more than a third of the businesses people do from home didn’t exist 25 years ago. The computer allows them to do things from home and create businesses that didn’t exist before,” such as desktop publishing and software development.

Mary Jo Ginty turned her enclosed porch into a home office when she started a health-care consulting business in her Long Beach home.

“It looks, feels and smells like a business,” said the former insurance and health-care executive. “It has a fax, a computer, a modem, a printer and a fancy-shmancy telephone. I’ve got a desk, a chair and file and supply cabinets.”

Still, Ginty and others say that being taken seriously as a business is one of the biggest hurdles to starting a home office.

“I never hid the fact that my office was in my home, but I didn’t broadcast it, either,” said Seena Sharp, who started an information broker business in her Hermosa Beach home. Sometimes, though, it was hard to be discreet when clients could hear her children screaming in the background during a telephone conversation.

Recruiting customers is another major obstacle for home businesses.

“The most difficult part is finding the business to do,” said Andre Sharp, Seena’s husband, who started doing corporate communications and technical writing after he was laid off from a management position with Mattel in 1986. “I assumed--and wrongfully so--that just because I could do the work meant that I could get the business. In a larger company, the work is brought to you. Now I’m always chasing the next contract.”

Zoning laws complicate the matter in cities such as Los Angeles, where it’s technically illegal to operate a business in one’s home. That makes it hard for home-based entrepreneurs to advertise.

“They don’t get listed in the Yellow Pages, they don’t do publicity, and they don’t do enough marketing for people to be able to seek them out,” Paul Edwards said.

Some people, like the Edwardses, make a point of living in cities that are friendly to home-based businesses. But many are ignorant of the zoning laws that govern their businesses, and still others prefer to simply ignore them.

Dworman’s neighborhood is not zoned for home-based businesses, but three bedrooms and his den are given over to his publishing company, which also produces three conferences a year. He says he doesn’t worry about zoning because “we don’t have a lot of traffic coming in here, and it’s not really a bother to anybody.”

On the whole, home business owners say the hassles are far outweighed by the benefits of being able to spend more time with family, control one’s hours, dress casually and avoid office politics.

“You lose the stability of the ongoing, predictable, timely paycheck,” said Tova Feder, who started a personal and business development coaching service in Sherman Oaks eight months ago. “But it’s exhilarating to have my income increase in direct proportion to my effort. I can’t see myself going back to a traditional job.”

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PCs Make It Possible

The number of people working from small offices and home offices (SOHOs) continues to grow as personal computers become more powerful, more affordable and easier to use.

* PCs AT HOME

Percentage of U.S. households with a personal computer:

1995: 40%

* HOME OFFICES

Number of Americans with home offices, in millions:

1995: 46

Sources: Electronic Industry Assn.; IDC/Link

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There’s No Commute, But. . .

Top 10 problems of working from home (according to a survey of home-based businesses):

1. Distractions from family and friends

2. Being taken seriously