Thinking about turning your hobby into a money generating business? These steps will help you avoid some common mistakes as you set out to earn an income from your favorite pastime.
Do you have what it takes?
Unless you’ve run a business before, it’s easy to get carried away with the idea of how perfect it will be to get paid for doing what you love. Reality check: the stress of needing to earn an income from your hobby can quickly take all the pleasure out of it.
Running a successful business isn’t all hobby indulgence. Unless you can afford to hire someone to take care of the bookkeeping, marketing and sales, expect to spend a lot of hours on necessary tasks completely unrelated to your true passion.
Before you start investing in your hobby-to-business idea, take this online quiz to see if running a business is right for you. If its right check out www.business.govt.nz for help with getting started and then contact us www.tutburyassociates.co.nz
Do your market research
If you’ve been gifted with the entrepreneurial spirit, you’re ahead of the game. It’s definitely a plus to be able to combine business know-how with your passion.
The question is, will people pay you for your great idea. If you love to garden, for instance, who will buy your herb garden kids, custom flower arrangements, or green thumb e-books?
One of the biggest mistakes home-based solopreneurs make is not doing their market research.
In a nutshell, market research is the process of:
- identifying potential markets
- understanding what your customers most want and need
- matching up your products and services to those needs
- examining the competition and
- creating a marketing plan.
As a pro tip, focus your efforts on a niche that isn’t currently being filled to increase your chances of success. You’ll minimize the competition and cut out unprofitable possibilities by creating a must-have solution designed for a highly specific customer.
Strategic marketing ideas
If you’re just starting up, odds are you’ll be running your business on a shoestring. You’ll need to be very selective about how you spend your marketing dollars—which is why it’s so important to know exactly who your customers are off the bat. Then it’s all a matter of making it as easy as possible for those people to find you.
A website and social media presence are essential for any small business. Consider craft fairs and trade shows, sponsoring a community event, joining a local business association, or partnering up with a compatible business as low-cost ways to get the word out.
If turning your hobby into a business seems right for you, test the waters for six months to a year before diving in. Running a small, no-pressure side business at first will show you whether your idea has the potential to become a sustainable full time business—before you quit your day job and invest all your savings.
Drafting a simple one page business plan before early on is a great way to help you think through and evaluate your idea, step by step, as you set goals and identify strategies to achieve them.
Business planning may seem like a lot of work for a small part time business venture, but unless you have a plan, how will you know when you’ve achieved your benchmark for success?