8 Ways to Slash the Cost of Setting Up Your Home Office

August 1, 1998

There's never been a better time to set up or expand your home office. Falling technology costs have made it possible to have a well-equipped office without busting your budget.

This year, Micro Center, a Columbus, Ohio-based retailer,wheeled out a 180MHz PC for $499. Other retailers quickly followed suit. Toss in a monitor and a printer, and the whole package is still way below the average $2,489 that REALTORS® spent on their home computers, according to a 1997 Simmons Market Research Bureau survey.

Some things you shouldn't scrimp on, but these days, a home office doesn’t have to cost an arm and a leg or even a few fingers. Today’s REALTOR® checked with a few of the nearly half million REALTORS® with home officesto find out what they’re doing to balance efficiency with frugality. These are their tips.

1.Forgo the ubiquitous fax.

The stunning fact is, owning a fax machine may not be necessary anymore.

“Most modems allow computers to send and receive faxes,” explains Stephen M. Canale, president of Acclaim Residential Marketing, Ypsilanti, Mich. For $12.50 a month, a company called jfax.com (jfax.com) provides you with a fax telephone number, receives your incoming faxes 24 hours a day, and forwards them as a graphics file to your E-mail address as soon as it receives them.

2.Buy a scanner instead.

It can get the documents you want to fax into your computer, if they aren’t already there. With no-frills models selling for between $100 and $150,scanners are less expensive than most fax machines and can also convert all those bits of paper lying around into itty-bitty computer files. Another benefit: Scanning snapshots means you don’t have to buy a digital camera to get pictures into your computer.

3. Nix the dedicated line for Web surfing.

Canale points out that since most practitioners have cell phones, anyway, simply have calls to your regular office line forwarded to your cell phone while you're on the Internet.

4. Consider getting your own photocopier. Prices are down in this category, too.

“I use it all the time,” says broker-owner Joe Cuchiara, of the $900 small-business Xerox he just bought. (Beware the less expensive home models; they’re slow and less sturdy.)

Cuchiara is gearing up a home office for his move from RE/MAX–All Stars in Colorado Springs, Colo., to his own company, Acorn Properties, also in Colorado Springs, in August. “The time savings alone makes it worthwhile,” he says, “but I still save a few cents a copy over a commercial copy center.”

Then again, if you already have a fax machine, try using it to make copies. Better yet, get a multifunction machine. For about what fax machines cost a few years ago, you can get a unit that combines the most popular office equipment. Xerox's Document HomeCentre ($499) offers a color printer, a color copier, and a color scanner that detaches to allow scanning of open books and odd-sized material. Brother's MFC-7000FC ($799) is a color printer, color copier, color scanner, plain paper fax, and digital answering system.

The caveat is that if the thing breaks down, a good part of your office's functionality goes with it.

5. Actually, who needs an answering machine?

Voice mail from the phone company typically costs less than $10 a month and can save you the initial expense of buying your own machine. In addition, the service often includes convenient features such as being able to reply to messages with the touch of a button and forward messages to other numbers.

Warren Smadbeck, broker-owner of Cherryvale Realty, Boulder, Colo., has a voice mail system that gives callers the option of leaving a message or transferring to a service that arranges showings.

6. Farm out the scheduling of showings.

The importance of being available to arrange showings is enough to make some practitioners spend big bucks on cell phones and pagers so that they can receive calls night and day. Instead, Smadbeck's local answering service takes the calls, makes the appointments, confirms with the sellers and the listing salespeople, who actually do the showing, and keeps Smadbeck informed. Sound pricey? Hardly. In March the service screened 46 calls and arranged 22 showings—all for $57.

7. Buy used.

The rule of thumb is that slightly scratched and worn desks, tables, and filing cabinets should sell at auctions or through the classifieds for roughly half of new.

8. Buy in bulk—maybe.

Nabbing a lot at one time may reduce per item costs, but it may not save money. If storage space is dear or buying in bulk will cause you to dip into a credit line (which, in turn, will cost you interest), forget it. If the deal's too good to pass up, try partnering with other one-person shops to split the cost.

Don't Scrimp on These Essentials

Über-misers may suggest turning empty appliance boxes into tables and using an old door atop two filing cabinets for a desk, but let’s get real: You're going to spend a lot of time in that home office and, one hopes, conduct a good chunk of business there. It better be efficient and comfortable.

It even makes sense to splurge on some things, such as

  • An ergonomic chair—It should have adjustments for height, backrest, armrests, seat canter, and a five-wheel base that swivels. But it’s not cheap: The top five office chairs in Consumer Reports, September 1996 issue, averaged $668 each. “I sprang for a good chair,” says Don Harris, salesperson with A.M. Relocation, Carmel, Ind. “It’s one of the best investments I've made.”
  • A phone system—It’s your umbilical cord to consumers. Features and sound quality should reflect the excellence you're trying to project. Cuchiara plunked down $180 for The Home Receptionist (U S WEST, 800/208–8111). Coupled with $20 per month of add-on services from the local phone company, the telephone boasts caller ID, music on hold, and multiple voice mail boxes. Also consider a phone headset, which runs about $50 to $100 and frees your hands for taking notes and finding documents while you talk. The practitioners we talked to who use headsets said they couldn't function without them.
  • Illumination—When it comes to lighting, most of us are in the dark, says Robert Baron, a professor of management at Rensselaer Polytechnic Institute, Troy, N.Y. “Different tasks require different lighting,” Baron says. Bright light for document handling, for example; softer light for computer work. Whatever the job, use warm incandescent bulbs. “Their light is the most similar to sunlight, which helps keep your energy level high,” Baron says. And to achieve the optimal lighting conditions, you may need to splurge on better-quality lamps than those stowed in your attic. Even with these few extravagances, setting up a home office isn’t nearly as sacrificial as it used to be. “Lower prices have let me set up the office I need to do business,” says Cuchiara. “I'm missing luxuries, not necessities. The things I have could be bigger and better. Maybe down the road . . .”

You're the Boss—Set Some Rules

Time really is money, which keeps the cliché from getting too irritating, especially when it’s followed by advice you can use. To that end, here are a few ways home-office workers can pull more time out of each day.

  • Shift your E-mail program into overdrive. Far from the one-trick ponies most people consider them, the latest E-mail programs are packed with such time-saving features as templates (for, say, shooting off a quick thank-you or meeting confirmation) and automatic response.The latter automatically E-mails a specific file to people who send a message containing the proper code. So, for example, any time the Smiths want a status report of their listing, they send an E-mail to you containing the word Smith. Your program, in turn, E-mails them your log of listing activity for their property.
  • Make a daily things-to-do list—and include even the smallest of tasks. “If you need to return a call, send a fax, or sharpen your pencils, write it down,” says Jane Paulus, a top producer at Edina Realty, Edina, Minn. “It keeps your mind free of clutter, gives you a sense of accomplishment when you check it off, and, most important, it reminds you to do it.”
  • Don't feel bad spending time to save money. Upstarts often have more time than cash. That’s when you should design your own business cards, answer your own phones, run your own errands. As your business grows and your time becomes more valuable, delegate such tasks to outside services.

For More Information

You'll find a lot of primers at bookstores on running a home business, but beware: Most waste pages on listing possible types of businesses to try and expounding ad nauseam on common sense—such as the importance of returning clients’ calls. One that gets down to brass tacks is Paper Clips to Printers: The Cost-Cutting Sourcebook for Your Home Office, by Dean King and Jessica King ($11.95, Penguin USA).

  • To buy furniture and equipment through mail order, call Reliable Home Office, 800/869–6000.
  • The Small Business Administration's Business Information Centers provide education, counseling, and training for fledgling and expanding small businesses. Contact the SBA at 200 N. College St., Suite A2015, Charlotte, NC 28202–2173; call 800/827–5722; or visit www.sbaonline.sba.gov.
  • On the Internet, Home Office Mall (the-office.com/) is a great jumping-off point to find everything from office furniture designed for home-based businesses to a database of attorneys.
  • Two of the most helpful tips-and-tricks Web sites are iVillage's Work at Home (www.ivillage.com/work/) and Your Company (pathfinder.com/money/yourco), hosted by Fortune magazine.
  • Avail yourself of the affinity deals NAR has worked out for members.
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