It’s not unusual for people to ask how to turn their hobby into a business. It sounds easy to earn money from something you enjoy. Let’s face it, you probably love your hobby and why wouldn’t lots of other people like what you do? The purpose of this article is to encourage you to think realistically about your ideas and 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 likely 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’re producing something you will need to produce greater volumes, 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’re offering.
Is there a good size market for your offer?
It’s 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 it doesn’t 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’s a good idea?
As part of your market research you need to seek feedback on your idea. One group to ask might be those 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 don’t like to offend you.
Do people you don’t know say it’s a good idea?
Not as easy to obtain but feedback from people who don’t know you shouldn’t be biased and will be more valuable.
Are you willing to listen to advice?
The most successful business people recognise that they don’t know everything and welcome advice from others.
Is it right for you?
The emphasis here is on ‘you’. If you’ve 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.
But it’s very different doing something for a hobby compared with 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 won’t 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 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’re 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?
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’re 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 government requirements.
- You have the necessary funds to start your business.
- You are being realistic!
So it’s 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.