Whether you’re a long-time small business owner interested in pursuing a transition to financially support your retirement or an aspiring millennial entrepreneur with a social media following and a dream, turning a hobby into a business is now more plausible than ever.
In fact, it’s estimated that around 27 million Americans are working full-time in self-employment by the end of 2020. But just like any business venture, if you’re trying to figure out how to profit from your vintage clothing collection or how to attract potential clients to your recording studio, success takes more than mastering the art of whatever your hobby may be. Here are eight tips to help you capitalize on changing your passion project into a full on small business:
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1) Set Your Limits
First things first, it’s crucial to determine what exactly your goals are in terms of turning your hobby into a business. Ask yourself questions: Is this something I want to be able to retire off of? Do I want to morph this into something I can use to make a little hobby income on the side with? How much time, effort, and money am I willing to invest in this project? Am I willing to take on the responsibility of taxes and deal with the IRS for my hobby? Writing down your own terms and agreements for your newfound small business plan will help you comprehend how much a commitment you’re about to take on.
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2) Envision The Value
After you’ve established how far you’re willing to take your hobby, you need to figure out whether it’s financially prosperous or not. If your hobby involves creating a product, such as paintings, clothing, eco-friendly services and products, or food, it’s crucial to calculate how much of your product you’ll have to sell to meet your goals. If your hobby is a skill, such as bike repair or math tutoring, calculate how much you plan on charging customers per hour with how many hours you hope to be working to see if your estimates are financially viable. This is a good exercise for determining whether or not your goals and expectations are realistic.
3) Keep Tabs on Other Small Businesses
According to Business Insider, one of the most common mistakes for aspiring entrepreneurs is failing to consider their competition. While you may be the only person you know who has mastered the art or trade of your hobby, chances are there are already plenty of established businesses that sell or cater to whatever it is you are pursuing. That doesn’t mean you should feel intimidated if it turns out there are others out there also trying to profit off your passion project. You just need to be more creative in regards to determining what separates your product or skill from the rest of the pack. If your hobby is baked goods and there are several bakeries around your neighborhood, research what types of goods they sell and can you provide something different? Are any of them gluten-free? Do they specialize in cookies and cakes or savory breakfast items? What is their proximity from your proposed location? The more angles you find that can highlight the specificity of your hobby, the more your small business can stand out.
4) Look Through the Eyes of Others
Perhaps the hardest thing to do is separate yourself from your project. But if you’re able to step back and see your future small business through the eyes of your potential customers, you can help yourself understand the ways to maximize your appeal to varying demographics. Let’s say you’re launching a pizza-serving food truck. Now, inhabit the mindset of someone who’d be interested in purchasing your pizza. Are they interested in affordability and quickness, or do they value quality and specificity over convenience. If you're selling a healthier-option pizza that uses all natural ingredients, where are the health-focused neighborhoods where co-ops and gyms reign supreme? If you're planning on cranking out classic pies by the slice, are there any college or young professional hot spots in need of a pepperoni fixing between classes or lunch breaks? Find your audience and determine how you can make your business most accessible to them.
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5) Draft Your Small Business Plan
Whether you’re planning on fixing computers out of your garage, obtaining permits for your blueprinted coffee house or coming up with a proprietary website tool for a financial company, every entrepreneurial pursuit needs a business plan. Think of a business plan as a written guideline for someone who’s interested in either investing, purchasing from, or working for your small business. Start with your mission statement and continue to outline any financial dynamics you have, such as startup costs and projected sales. Overall, make sure your business plan provides a thorough description for detailing your product or service, along with defining your goals and expectations for your hobby-turned-business.
6) Craft Your New Company's Brand
In this digital day and age, an eye-catching logo or clever slogan can be the difference between success and failure. Think of branding your new small business as creating an identity or personality for it. This starts with giving your business a name and a logo, and ends with finishing touches such as small business web design or social media management. For many small business owners, this may seem like the most daunting dynamic to turning your hobby into a business, but it’s arguably the most crucial in terms of maximizing your potential.
7) Master Your SBO Marketing
This is where you can start figuring out what avenues you can take to reach new, bigger audiences. From establishing an online and social media presence to considering various forms of advertising, you’ll have to begin crafting an SBO marketing plan that can help potential customers and clients understand what separates your talents from the rest of the pack. A solid marketing approach is what can help elevate your small business in terms of reach, sales, and networking.
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8) Build a Beautiful Small Business Website
An effective and affordable way to legitimize your hobby as it transitions into a business is by building a beautiful website. Whether your goal is to remain a micro business or build up a larger legacy, an attractive web design helps spread positive organizational awareness.
If crafting a top-notch digital look for your small business is something you need, contact Frahm Digital today. Our small business web designers have the expertise to make your brand stand out.
For Creative Small Business Ideas, Hire Frahm Digital
Are you ready to turn your hobby into a business? A website is a great first step, and Frahm Digital can help develop a digital presence for you. Whether you need a beautiful website, creative copywriting or content development, we’ve enhanced dozens of brands around the U.S. – and can do the same for you.
Get in touch with our team to discuss how we can improve the digital appeal of your small business.