Starting a business from a hobby is a dream for many. Done well, it can turn passion into profit.
Over the years I’ve worked with lots of businesses that have been borne from a hobby. A common example of this is a photographer. With digital cameras making photography more accessible, (and any other hobby turning into a business) thoughts turn towards whether a career can be made. While this is absolutely possible in many cases, there are some golden rules to follow:
1. Set goals
Firstly, what do you want to achieve from starting a business? Is it extra income to pay for family extras like holidays or a new car? Perhaps it’s a retirement plan? Or maybe you want to replace your full time job with the hobby business. Whatever it is, spend time thinking about your goals. Once you know what they are, you can plan to achieve them.
2. Business strategy
OK, how will you ensure your business reaches your goals? One of the early things to decide is how to make money from the skills you’ve learned. The obvious choice is to start selling your services or products, whether that’s photography, cakes, or other crafts/professions. I would urge you to research the market, is there room for another one of you?
If there is already a huge choice of other businesses doing what you do, don’t worry! As with any successful business, you’ll need to define your USP (unique selling point). Be sure to communicate it in order to stand out from the competition.
Alternatively, you could consider teaching others your skill! Once again, research will help establish the viability of this as a business strategy.
I can’t stress enough how important pricing is as part of your business plan. The tendency with hobby businesses, is for products and services to undersold. Why? When starting a business from a hobby, the business owner doesn’t always value themselves and their skills highly enough. Or, while still holding a ‘day job’, income isn’t the driver and prices are cheap.
Again, when setting your price, research is vital. What are your competitors charging? How successful do they appear to be? Where do you fit with your offering? Be careful to set your price at what you are worth! Once you’ve made your first sale, your confidence will build.
4. Marketing strategy
The final piece of the puzzle is to plan how you’ll get your products and services in front of your audience.
Firstly, work out who your audience is. Are you selling to businesses or consumers? Are they predominantly male or female? Are they affluent or hard up? How old are they? What are their likes and dislikes? Answering these questions will help build a profile of your typical client and with that, you can decide where and how to advertise.
For example, a photographers typical client may be young, engaged women. A great way to get get in front of potential customers would be to attend wedding fairs. Another is to create alliances with other wedding professionals. By doing so, you can recommend one another. Networking is a great way to do this.
Think about where your clients spend time or what publications they may read. Knowing this will direct where to exhibit or advertise.
5. The business plan
Now you’re well on your way. With these four steps in place, you have a simple business plan and can move your hobby business into a viable business.
Read onto my next blog: Starting a business checklist, for advice on the remaining must-do tasks to get your business set up and registered correctly.
As ever, if you need any help going through these processes, why not contact me for a free new business review? I’ll spend two hours with you giving you professional coaching on starting a business. I’ll leave you with actions for immediate implementation.