You have a hobby you’re obsessed with, and you’re thinking about making an income from it—not a bad idea. Everyone wants to make money from doing something they love. And now, you have a chance at making that reality.
But before you jump ahead, we’re pumping the breaks (just a bit) and want to make sure your hobby transforms into a successful business. This post will help you prepare yourself and teach you the steps needed to make your hobby a business.
Now we’re not trying to discourage you from turning your hobby into a business. If anything, we want you to make an income doing what you love. But before you take the leap, it’s important to do a little self-reflection and make sure it’s the right move for you.
What’s your purpose for taking your hobby to the next level? Understanding why you’re choosing this path will help you clarify your business goals and act as a reminder for you when you go through tough times—hate to break it to you, tough times are inevitable.
However, what matters is your ability to push through those rough moments—and that comes with reminding yourself why you made your hobby a business.
Turning your hobby into a business can be a dream to many until they realize this means turning it into full-time work. Some hobbies are more enjoyable as hobbies, and that’s okay.
If you see that turning your hobby into a business isn’t making you happy, it’s better to keep it as a hobby. But if you’re ready to make your hobby a business, then get ready to commit to it as a full-time job.
Turning your hobby into a business will take a financial investment on your part. While there are many platforms available for you to market your business for free, the reality is your business isn’t going to boom overnight (even though we hope it does!).
It takes time for most businesses to start to make a steady income. That said, are you able to financially support yourself during that time?
Everyone has something to say, and while I’m sure most of the feedback will be positive, you’re going to encounter people who aren’t so nice. Should this discourage you? No way!
If anything, accept this as a part of doing business. Not everyone will support your product or service—that’s just the way it is. But to prevent the negative feedback from being a buzzkill, reflect on why you have this business and what it means to you.
You’ve answered the questions above, and you’re focused on turning your hobby into a business—great! Your desire to put in the effort is the first step. Now, you need to see if your hobby is physically able to become a business.
In general, most hobbies have the potential to become a business; it’ll just require some brainstorming on your end to figure out how to make it profitable. And that could mean your hobby isn’t quite ready for the next step.
To see if your hobby is ready to become a business, 4 indicators will tell you it’s time.
You’re signing up for courses and classes to expand your skills and become an expert in your hobby. But currently, you’re not able to deduct those as business expenses.
Now, if you’re knitting a scarf once a month, it’s not worth turning it into a business. But if the expenses for your hobby are significant and you’re making sales, turning it into a business can allow you to write off related expenses.
A hobby isn’t supposed to be your primary source of income—it’s something you enjoy doing in your spare time and aren’t looking to profit from it. If you make a sale here or there, that’s great. If not, you’re all good.
However, if you’re seeing that your hobby is becoming your bread and butter, then this is a huge sign it’s time to turn it into a business.
When you’re a business, you have a set of expenses that you need to cover. This means you have a set price list and clear boundaries on your working hours. Your time is money and you know it.
Whereas, for hobbyists, since this isn’t their main income, this isn’t a concern. Hobbyists are more flexible regarding pricing and time—the client can set the tone.
Do you like your hobby more than your full-time job? Do you wake up in the morning wanting to focus your attention on your hobby? Well, if so, it sounds like your heart is in the right place.
If you value your hobby more than your current job, and the other factors listed above connect with your current situation, it’s time to put more attention to your hobby.
Now, this all sounds fine and dandy on paper, but how do you transform your hobby into a business? What are the steps you need to take? That’s what we’re going to talk about now.
You’ve decided; you want to turn your hobby into a business. It’s the right time, and you’re focused on making it work. So, how do you make it happen?
While each business is unique, here are the general steps you can take to transform your hobby into a business.
If you’re going to do this, you need to start with the right mindset.
A business makes you money; a hobby costs you money.
This is no longer something you do on the side for fun—this is your business. While you didn’t start your hobby to make money, that is now something you need to focus on.
To transition your hobby into a business, you’ll want to keep your costs down and increase revenue; that’s the formula to start making a profit.
Going from hobby to business may be your goal for now, but what happens after? It’s important to set a goal. For example, do you want this business to become your full-time job? A side hustle?
By knowing what you want out of your business, you can then set expectations and goals to help your business grow and flourish.
Research the market
You may think your product or service is the best idea in the world, but you need more than that. How’s the market? Who are your competitors? Who’s your target audience?
Get to know the industry you’re entering. By doing so, you’ll have a better idea of the potential market and how you’d like to position your business.
Aside from knowing the market, you need to understand how your business will make money. As a business owner, you should know:
By knowing the answers to these questions, you’ll create a business plan that will give you a clear understanding of your expenses and profits.
You have an idea of who your audience is and how you’ll sell your product or service, but how do you know you’re right? You don’t, and that’s why you do a test run.
You can tweak your business plan or marketing strategy better to fit your potential customers with a test run. A test run can look like a couple of different things. It can be:
While testing your business, what’s important is you stay flexible and open to change. If something isn’t working, change it. This is a part of building a business.
You don’t need to become a marketing expert, but understanding the basics can help you build your brand and attract customers. Luckily, there is plenty of online support to help you learn about marketing your business.
There’s no textbook formula when it comes to marketing; you’ll need to play around and see what works for your business. Since you’re in the beginning stages of your business, open a website and take advantage of free marketing platforms, including Instagram, Facebook, and TikTok. You may also want to invest in paid ads to build a customer base, but learn the basics before doing so.
For your business to sustain itself and grow, it needs customers. After testing your idea and opening a website, it’s time to get sales. How do you get sales? Through your marketing channels, your local community, and previous customers (if you have them).
I’m going to be honest; it’s not easy gaining customers right away, especially if you’re starting from scratch. However, you can start building your audience and gain brand trust by offering promotional discounts and incentives. Everyone likes receiving 10% off as a new customer, or an extra 15% off if they tell a friend.
If you want your small business to flourish, create goals to meet. Naturally, those goals you make in the beginning will evolve the longer your business operates – you’ll adjust aspects of your business once you start seeing data and results. Even though your milestones may change over time, you can use them to help push your business forward.
Your business is off the ground, and things are rolling! You should network and connect yourself with a business mentor when you’re a business owner. As a small business, you want someone who can support and guide you through your journey.
A mentor can be someone in your community, a family member, a well-known entrepreneur, a friend—someone who knows the process and can help guide you.
You now know everything there is to transform your hobby into a business, so it’s time to take action. Give yourself time and patience to build your business—Rome wasn’t built in a day.
Answer the questions and follow the steps above to help gain clarity and a path to move forward. If you do, you’ll be well on your way to creating the business you’ve always wanted.
Natasha Ivanovic is a Vancouver-born creative writer that started her writing career as a freelancer while studying for her Master’s in Investigative Psychology. On the weekends, she writes short stories for her blog, TheLonelySerb, and cuddles with her bulldog, Bob.