Got a hobby? Here's how to turn it into a thriving business
MANILA, Philippines - We’ve all heard the saying “do what you love and the money will follow”. But how many of us have actually thought about turning our passions into profit?
If we take a look around us, many of the thriving businesses started out from small beginnings – hobbies that their founders thought of pursuing.
Restaurants and cafes sprouted from kitchen adventures, while jewelry and clothing lines took off from the love for fashion. From homemade dishes to internationally acclaimed apparel, a hobby was transformed into a profitable business.
So if you've got a hobby, maybe it’s time to think about how you can profit from it. All it takes is a little ingenuity and financial planning for you to transform your passion into a means to earn.
If you've already got the passion, we suggest at least 7 things to consider before you take the leap:
1. Use your knowledge, experience and network to your advantage.
Having dabbled in your hobby for quite some time, you’re already familiar with important information and details that you’d need as an entrepreneur. Think about what you need for your hobby. This can range from tools, to transportation costs to various expenses. Who are the suppliers? Look into getting the best deals from the people you might already know. Are there any competitors? Check on how they price their products and services to customize yours. Such information can serve as your basic market research which can help you build a financial plan.
2. Invest wisely.
Once you know the costs, check your financial profile and see how much you can invest. Begin with a modest amount that you can afford to tie up in the business, and use this for something that will bring profit. In the beginning, invest in items that can offer a quicker turn around between spending and earning. For example, if you like baking and want to pursue a cupcake business, use your funds to buy more baking ingredients that will allow you to produce more cupcakes, instead of building a bigger kitchen. As your profit grows, you’ll have more to invest for bigger items to bring in more earnings, like equipment, space and even manpower.
3. Stick to a money schedule.
To manage your cash flow, plan your finances. Schedule expenses so that you will have enough money to fund your operations in between payments. If you keep an inventory, know when to re-stock. Buying in bulk, albeit cheaper, can also eat into your funds so make sure you weigh the upsides versus downsides.
4. Know the requirements for setting up a business.
Records may not have been important for you as a hobbyist but once you go into business, these become a necessity. Take note of government regulations and requirements that you would need to start and grow a business. You may find that some of the regulations will make it easier for you, for example, entitle you to a tax rebate as a start-up. Once everything is set, keep your records in a safe place.
5. Ease your spending with what you alreay have.
If you’ve got a credit line, this can offer ample time from purchasing items and paying bills, giving you an opportunity to earn before the billing date. Most credit cards also offer installment plans and promotions, which can help maximize your cash flow without taking a huge chunk out of your bank account. A number of successful entrepreneurs today readily admit their credit cards helped them find their feet when setting up. As your business grows, talk to your bank about taking out a loan or other investment options. Do your research and know where to find the best deals for your expenses.
6. Create some noise, digitally.
Online presence can cost you next to nothing to market your business. Creating a simple profile on social media channels can help you test the waters, or if you've taken the plunge, to boost your presence and reach a very wide audience. If you’re joining a trade fair or bazaar, for example, chances are the organizer will also be advertising you on their website or profile. An online store can also offer a cheaper alternative to renting space. If you plan to sell or market your items through the internet, offer a safe payment gateway that customers are comfortable with. Once you’re online, make sure you’re easy to find and contact.
7. Nourish your business.
Your business will flourish if it receives the personal touch that you had for it as a hobby. Trust your instincts and know when it’s time to expand or modify your business model. You have to do your research to find venues for selling your product or a new market to tap. No matter how big or small your business is, your personal attention will always be vital to its success.
Grow Your Money is an editorial partnership between ABS-CBNnews.com and Citi Philippines to promote financial education and provide helpful information to Filipinos on how to better manage their personal finances.
Visit www.citibank.com.ph for more information.