According to research studies, over 50% of small enterprises operate from homes. If your small business is one of them, you might be wondering if your business address should be your home address or something different.
What is a service area business?
Before we get into the nitty-gritty of which address or addresses you should use and why, let’s talk about the two main types of businesses.
These types of businesses always have a location that customers can visit. Companies with a storefront location, private clinics, or offices where customers can make appointments or show up during regular business hours are all examples of this type of business.
If your business is one of these, then your address is going to be the physical location of your business in most cases.
Service-area businesses don’t have physical locations customers can visit during posted business hours.
Instead, business owners or their employees serve customers within a specified area, and visit customers or deliver items to customers.
Examples of service-area businesses include local service businesses like:
◆ House Cleaners
◆ Other types of home services contractors
Home-based businesses are also examples of this type of business, for example:
◆ Dog Groomers
◆ Consultants – if you meet with clients in person
◆ Freelancers – if you meet with clients in person.
To answer this question, let’s go back to the two business types:
If your business is a store or a different kind of business with a physical location, then your address is going to be the actual business in most cases and not your home address.
However, when you run your company from your home or a service vehicle and a cell phone or laptop, things start to get a bit complicated.
Should it be your home address, or would a post office box, mailbox service, or virtual office be ok? Let’s look at each option.
Virtual business addresses and virtual offices are two slightly different but related concepts.
The first is mailboxes at mailing services and UPS stores that instead of being post office box numbers are the address of the store and a pseudo-suite number.
Whereas virtual offices are a little more challenging to define. That’s because there are two definitions of the term “virtual office.”
◆ Virtual Office as a business service
The original definition of the term means a business that provides office type services such as admin services, receptionist services, and use of office equipment or a meeting or conference room companies that do not have a physical location.
These businesses will also provide their clients with a business address that’s similar to the type of address a mailbox service might provide.
◆ Virtual Office as a Virtual Company
The second, more recent definition, is a company with no location which meets customers via video conference and cell phone. The employees usually work from home and can be spread out all over the world.
If you operate your business from your home, you might be a virtual company, and you might use virtual office services, including as an address for your bank or to register your operation as a Limited Liability Company (LLC).