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| How to turn your hobby into a successful
business |
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Similarly, if your spouse has a steady job, it may
make sense for you to dabble with turning your hobby into a business.
But if you're the family's sole wage earner, taking the entrepreneurial
route could be a road to disaster.
Step 5: Decide
how committed you want to be.
The answers you arrive at in Step 4 will in large part determine
whether you turn your hobby into a full-time business or make it
a part-time venture. Either choice has pros and cons.
The advantage of going full-throttle
is that you've got a powerful incentive to succeed and you'll be
able to devote the time necessary to allow your venture to grow.
A part-time venture, by contrast, may never really succeed because
you're not allocating enough time and resources to it, says CPA
Klein.
The disadvantage of chucking it all for a new business
is that you have no parachute. If your business dream takes flight,
fine. If it crashes, you're going down with it.
Starting off slow by keeping your job and starting
a business part-time can help reduce the amount of capital necessary.
Your exposure is also less; if your business fails, you still have
steady income from your other job.
Step 6: Find
an innovative business angle.
Once you get (or give yourself) the green light to turn your hobby
into a business, you have to figure out the twist that will turn
recreation into income.
"Just because a hobby is fun doesn't mean they'll
pay you to do it," says Chris Cameron, a train collector who
turned his passion into a business. "One obvious thing I could
have done was buy a bunch of trains and sell them. Not a good idea.
You collect what you love and sell what you hate."
So instead merely selling model trains, Cameron found
an unmet need. Hobbyists want to know how much train sets and their
parts are selling for; pricing can fluctuate widely and it was nearly
impossible for people to keep track on their own. Cameron, who knows
something about software programming, found a partner and they designed
a program that tracks pricing in the model train market.
Ways to transform a hobby into a profitable business
include:
- Solve a problem. Amateur
guitar players have to learn chords and scales. Chords are relatively
easy to learn. Scales require fingering, a difficult and time-consuming
skill to master. So Rusty Shaffer, guitar player and inventor,
created a computer-powered guitar that fingers the instrument
for learning players. He now sells his invention through his business,
Optek Music Systems of New Hampshire.
- Teach others. Almost
any hobby, from mahjong to martial arts, can be taught in classes
for which can charge.
- Sell the raw materials.
Suzanne Colon and Cameron Hildreth love knitting. Lucky for
them, it's a hobby that's been gaining in popularity. (Last year,
reports the Washington Post, Americans spent an estimated $450
million on yarn and other knitting essentials up from $400 million
from five years ago.) So Colon and Hildreth opened Stix, a Bozeman,
Mont., store where other knitters and crocheters gather to exchange
tips, take classes or buy fine yarns. Although Stix is an actual
retail location, don't overlook the possibility of selling your
hobby's essential materials via an Internet shop.
- Expand into related services.
Charlotte Reed owns Two Dogs & A Goat Inc., a pet care
service in Manhattan and Hampton, Long Island. If Reed operated
solely as an individual dog walker, she probably wouldn't be making
enough money to suit her. But her pet-care empire offers dog walking,
exercise programs, grooming, training and sitting services for
dogs, cats, birds, fish and other small animals.
Train enthusiast Cameron compares a successful hobby-based
business to a military operation. "It's like the Marines,"
he says. "They improve, adapt and overcome. You have to do
the same with your hobby-turned-business."
Jenny C. McCune is a
contributing editor based in Montana.
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