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How to make the transition from Large Office Corporate Office (LOCO) to Small Office Home Office (SOHO). Cover story hed: Going LOCO? Go SOHO dek: how to make the transition from Large Office Corporate Office (LOCO) to Small Office Home Office (SOHO). dek: setting up a small office or home office doesn’t have to be scary. by Joel Hoekstra

The day I paid $22 for a nine-page fax was the day I became convinced of the value of home-office technology investments. For six weeks, I’d been running a startup business off of a single phone line and an outdated laptop with a postcard-sized screen. My commute consisted of a 20-pace stroll from bed to desk, via the refrigerator. Day and night, I answered the phone with a serious tone in my voice, unsure if the caller was a potential client or a pesky telemarketer. Whatever the shoestring nature of my operation, the outside world had to think I was a professional.

Faxes, I soon discovered, were wholly capable of destroying this illusion. When a client asked for my fax number, I found myself sputtering. I had neither machine nor receptionist to handle such simple communiqués. Reluctant to spend $200 on a fledgling business that had yet to produce a penny of income, however, I decided against buying my own fax machine. I would have faxes sent and received at the office-services shop just down the block. At least, that’s what I thought until I bought that $22 fax.

Setting up a home office or small office for conducting business is rarely an inexpensive proposition, but as with any business decision, a little investment and forethought often go a long way. (For example, when I figured that eight or so more fax transmissions would cost me as much as a cheap machine, I bought one that afternoon.)

While the basic tools of business–computers, printers, software, desks, chairs–are much the same as in the corporate world, the particular makes and models you might choose for a home office depend largely on your professional needs and your personal tastes and budget. A graphic designer, for instance, couldn’t have survived on the pokey black-and-white Powerbook 520 I started on. (Ultimately, neither could I–I’ve since upgraded to a G3 with color screen.) And a communications consultant would have wilted at the sight of my dot-matrix printer. (A trusty Brother laser printer now lies within arm’s reach.) But during my first year of business, I did manage to eke out a living as a freelance business writer with these Stone Age tools.

I put my first few dollars into business cards, phone services, and other items that were likely to affect perceptions of my professionalism among my clients. It’s an approach many home-business experts and operators recommend. “My advice is to scrimp whenever you can,” says Lindsay Frucci, president of No Pudge! Foods Inc., a New Hampshire purveyor and distributor of all-natural, fat-free brownie mixes. She started the business in her kitchen two years ago, and now works out of a remodeled garage attic with two other employees.

“I splurge where I think it’s going to have impact with my customers,” she says. “You can be working from your bedroom these days, but your customer can have the impression that you’re sitting in a high-rise on Park Avenue.”

Increasingly, however, technology plays a vital part in the images we present to the world. The client who doesn’t have the option to leave a voice-mail message isn’t likely to call back. If you can’t download the file that a vendor has sent you, business may slow to a crawl. Once you’ve got your home office up and running, of course, you’ll know better what sort of technological prowess you require. Until then, advises Millie Szerman, a home-office entrepreneur and author of “A View from the Tub: An Inspiring and Practical Guide to Working from Home,” try to estimate the basics of what you’ll need. “Then, just to be safe,” she says, “take it a half-step up.”

Wired for work

Most home offices revolve around a computer, monitor, keyboard, and mouse. You may already have those core components, but if you don’t, or are considering upgrading, take a minute to assess your needs. The vital questions revolve around processing power, RAM, and hard-disk space. “The rule of thumb here is to buy as much processing power as you can afford,” says business coach/speaker Robert Imbriale. “The more processing power you buy today, the longer your computer will serve you before it becomes obsolete.” And RAM? “This is another item that you can never have too much of,” Imbriale counsels. “So buy as much as your budget will allow.” As for hard-disk space, ditto.

Fourteen-inch monitors may be standard, but bigger models are easier on the eyes. Likewise, a spectrum of better-for-you keyboards and mice exist. The key is to find components that are comfortable and easy to use. These pieces will become your round-the-clock companions while working from home, so each one should fit you like a glove.

And before you buy a box and monitor off the shelf or order one from custom manufacturer like Dell, consider portability. “Nowadays, many people are running their entire business off a laptop,” notes Terri Lonier, author of “Working Solo: The Real Guide to Freedom & Financial Success in Your Own Business.” “They park it on their desktop at the office, or they take it on the road.” Docking accessories and extensions for laptops alleviate once-common concerns about backing up files or crouching over a tiny keyboard.

Finally, think about the future and the past. If you were to buy software or a new printer in two years, would you have the necessary CD-ROM drive or USB port to accommodate your upgrades? Or, if you regularly access data stored on 3.5-inch floppies, does your new box have a drive to read them?

Software choices, of course, depend largely on your profession-but few offices can operate without Microsoft Office, WordPerfect Office, or some sort of word-processing/spreadsheet/ presentation/database suite. Beyond that, many home-office experts recommend accounting software such as Quicken or Peachtree for keeping track of cash flow, inventory, and invoices. Likewise, e-mail, appointment book, and contact-manager programs are deemed essential to keeping up with day-to-day activities.

Multifunction printers (MFPs) are a SOHO user’s best friend. If you haven’t heard of this hybrid, you’ll be glad for the news. MFPs integrate the functions of a fax, copier, printer (and often, scanner) into one unit-at a fraction of the combined cost for standalone units. Xerox’s Workcentre 470DX Color All-in-One, for example, retails at about $180 and prints, copies, scans, and faxes. Hewlett-Packard’s OfficeJet G55, with a flatbed scanner and faster output, can be found for just under $400.

MFP’s compact footprint, says Lonier, makes MFPs ideal for small offices. “But, as I have personally found out,” she adds, “you really lose a lot of functionality if the unit goes down.” When, for example, her multifunction printer died just four days after the warranty expired, Lonier was forced to go out and buy a standalone printer to finish a project.

Try another line

Shortly after starting my business, I secured from the phone company a second number and custom-ring service that allowed me to discern whether my calls were business-related or personal. But I quickly found myself needing another line for Internet usage, a third for faxes, and so on.

I began experimenting with different phone services. Voice messaging was essential–a simple answering machine wouldn’t have kicked in while I was using the line. Call forwarding provided a seamless connection for those trying to reach me when I worked on-site with a client for several months. The array of options offered by many phone companies–in urban areas, at least–are astonishing: DSL, call waiting, caller ID, and so forth. Though initiation fees aren’t cheap, it’s well worth trying a few options to see what works for you.

Regardless, you’ll probably need a second line. Even the most tolerant client is likely to be put off busy signals, perpetual voice-mail communications, and your inability to accept faxes while you’re on the phone. Home-office guru Szerman has business, personal, and fax/Internet lines. Lynn Brewer, a creative-services provider who handles business for clients in Seattle, New York, and Chicago from her home office in tiny Roy, Wash., forwards her business calls to a cell phone when she’s out running errands. “I have only a few clients, but I try to service them very well,” Brewer says.

Speedy, always-on Internet access is increasingly the standard, even among home-office users. Brewer, who works out of a converted chicken coop, notes that there’s no T1 service in her rural area. But a DirecPC satellite dish allows her to download sent files almost instantaneously. Uploading still has to be done via landline, she notes, but for graphics-intensive work such as hers, the faster downloading capability offered by the dish has been a godsend.

Whether it’s your phone, your PC, or the vital work you’ve got stored on your hard drive, you’ll want to protect the assets of your business. Don’t skimp when it comes to UPS systems: A lightning storm could decommission some or even all of your equipment if it’s not protected. And even with good surge protection, the resulting power outage could cause data loss. UPS systems both protect against surges and provide a half hour or so of extra power to help you save mission-critical work and safely shut down your system. Likewise, backing up your computer files on removable media or online (Lonier, for example, squirrels away data at can save you from personal embarrassment and professional ruin. “We got hit with a virus just today, and that kind of stuff scares me to death,” says Frucci of No Pudge! “If I lost all my data, I’d lose my company.”

Milk crates or mahogany?

If technologically you’re ready for takeoff, there’s still the matter of setup. Feng shui or family activities may dictate furniture arrangements in the rest of the house, but in a home office, efficiency and comfort should reign supreme. A good office should be arranged something like a cockpit, in an L or U shape, advises Lonier: “Everything you want should be in easy arm’s reach.” But even the best SOHO pilot will benefit from a quick stretch or dash across the room. “There are some things that I put across the room-my printer, my fax-so that I have to get up and move once in a while, ” she adds.

Furnishings are mostly a matter of budget. If you’re a Rockefeller or the company bosses are footing the bill, go top-of-the-line, but with an eye toward ergonomics and functionality. Surprisingly, custom work may be cheaper than buying a prefab office system. “I have a totally built-in office, with computer desks, mail center, file cabinets, bookcases and ample collating and storage space. It was all built from regular laminates in off-white, though I could have chosen wood tones or various colors,” says Linda Novey-White, a small-business expert affiliated with the Service Corps of Retired Executives (SCORE), a nonprofit organization that provides services and resources (many of them free) to entrepreneurs and small companies The total cost of Novey White’s setup was less than $2,500.

SOHO users who meet with clients in their offices should, of course, set up their spaces accordingly. Flashy clients require flashy digs. But cash-strapped startups can make do with milk-crate filing systems and block-and-board shelves–with one exception. Though baker-businesswoman Frucci, for example, works off an old tomato-red Steelcase desk with a typewriter extension that holds her computer, she didn’t go cheap when it came to chairs. Hers has good lumbar support, adjustable arm rests, a swivel base, and plenty of cushion. “Don’t be tempted to buy a cheap one,” warns Novey-White. “What you save in initial costs you will spend in medication for your backaches.”

Running a business from a small or home office isn’t just the American dream–it’s a disease, jokes Frucci. “I love skipping the commute and that my two dogs are lying at my feet all through the workday. I like being here when my kids walk through the door after school. On the other hand, I’m often here from 7:15 in the morning until I walk down the hall and go to bed at night.

“But I started this business, and I’m going to make it happen.”

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