Turning a Hobby in to a Business
You will learn
- What questions you should be asking yourself
- What are the advantages of turning a hobby into a business
- What are the disadvantages
It is not unusual for people to try to turn a hobby in to a business. It sounds easy to earn money from something you enjoy. The purpose of this article is to encourage you to think realistically about your ideas, and to present the key things that need to be considered.
Is it a Good Idea?
The best approach is to develop a business plan, but before you spend too much time on this, it might be worth checking out the basics. Your idea needs to be tested, and you need to research the market to establish if there is a demand for your offer.
Being able to say yes to all of the following should position you for more detailed investigation.
Can You Replicate Your Hobby?
If you are producing a product, you will need to produce greater volumes. Equally, if you deliver a service, you will need to deliver more. You will also need to work to schedules and timescales.
Do You Know Who Will Buy It?
A key element of success is knowing in detail who will buy what you are offering.
Is There a Good Size Market for your Offer?
It is one thing knowing your customers, but how many are there? Ensure there are enough potential customers to sustain your business.
Does What You Sell Solve a Key Problem?
People buy things when it solves a problem for them, or provides a real benefit. If your product or service does not, then why would they bother?
Will People Pay?
As a hobby, you may have enjoyed doing things for free. Make sure customers value what you do sufficiently to pay once you start charging.
Do People You Know Say it is a Good Idea?
As part of your market research, you need to seek feedback on your idea. One group to ask might be the people you know, but you need to trust that they will give honest and constructive feedback. Friends and family can often give biased views because they do not like to offend you.
Do People You do not Know Say it is a Good Idea?
Feedback from people outside of your family and friend circles is not as easy to obtain. However, feedback from people who do not know you is likely to be less biased, and will be more valuable.
Are You Willing to Listen to Advice?
The most successful business people recognise that they do not know everything and welcome advice from others.
Is it Right for You?
The emphasis here is on ‘you’. If you have done your homework and your idea is viable, then you need to ask yourself are you right for the job.
The personal rewards for running your own business are many.
- You are in control and your own boss.
- You have the potential to generate a comfortable lifestyle.
- It builds confidence and independence.
- You can develop your own ideas.
However, there is a distinct difference between doing something for a hobby, and having to do it to provide an income. It is not uncommon for people who have made a business from their hobby to declare that they no longer enjoy doing it.
Will the Following be Acceptable?
- Making or doing things faster and perhaps not spending the time you would have as a hobby.
- Spending time working on the business and not on your hobby.
- If you stop doing it you will not have an income.
- You will have to sell what you do.
Other Things Should You be Asking Yourself
Do you enjoy a challenge? There is no doubt about it, starting a business is a challenge for anyone.
Have you got what it takes? Determination, commitment and passion are all necessary for success along with an understanding of business, a supportive family and the ability to sell.
Do you have the business skills? You will need to learn new skills or get someone else to do that job.
If you are giving up a paid job, will your new business replace the income you currently have? This is where detailed financial planning is important.
Have you considered alternatives? Working for someone else doing the same work is a potential alternative.
Have you spoken with others who have started businesses from their hobbies? They can be a trusted source of useful information.
So you feel you have a good idea and feedback is favourable, ultimately starting a business is your decision.
Are You ‘Business Ready’?
You will need to plan methodically before taking the final decision, and a plan will serve as a final checklist. Meanwhile, if you have any doubts about the following statements, revisit your thoughts or speak with someone you can trust for guidance.
- You have thoroughly tested your idea.
- You know how and where to market your business.
- You have the capacity and resources to deliver.
- There is an acceptable profit in what you are planning to sell.
- All identifiable barriers and risks can be overcome.
- Your plans have long-term potential for both personal satisfaction and financial reward.
- You have addressed all legal and governmental requirements.
- You have the necessary funds to start your business.
- You are being realistic!
So, it is a good idea and you feel ready to take the plunge? Only start your business once you have put everything down on paper and come up with a plan – a business plan.
To get you started we have put together a free helpful eBook to guide you through starting a business, you can get it here.