December 23, 2016 / Lizzie Sullivan
As the year comes to a close children are displaying Christmas crafts they have made at school. They enthusiastically show off a toilet roll that has been transformed into an angel, or a piece of white paper cut into a snowflake. Parents descend onto Pinterest to find interesting ideas to keep their little ones busy in the run up to Christmas day. Crafters are busy putting the finishing touches to homemade gifts ready for the 25th. In short everyone is crafting and now people are making businesses out of the things they have made. But when does a hobby become a business.
Combining your hobby and business
You might decide to turn your hobby into a business, but before you do it is worth asking yourself whether you really want to turn something that brings you fun, relaxation and enjoyment into a business. If you still want to push forward then you aren’t alone, hobby entrepreneurs or funtrepreneurs as they are called have contributed a whopping £165bn to the UK economy. So far this year a staggering 645,680 startups have been created, compared to 608,100 in 2015 and 581,173 in 2014.
What do I need to think about when turning a hobby into a business?
If you decide it is the right time to turn your hobby into a business then you need to think about certain aspects:
- When you start working for yourself you become self-employed, and with self-employment status comes rules set out by HMRC. You will need to source an accountant who can explain your obligations and ensure that you don’t miss deadlines for filing information.
- Think about what products you want to sell and set a price point that enables you to make a profit. Remember to factor in a cost for your own time otherwise you will be making a loss.
- Plan how you to acquire the goods you may need to make your products or perhaps you can buy the goods already made directly from manufacturers ready to sell.
- Test the market, don’t go out spending lots of money on stock, supplies or a fancy website. If you can only get a deal from a supplier for buying in bulk try purchasing your products from wholesalers, and then when you get a customer base turn to buying in larger quantities. You may like and enjoy your hobby but is there a large enough interest to be able to make it into a viable business.
- Plan for growth, nobody starts a business thinking it will fail, plan how you will cope with large volume of sales, will you need other people as part of your business to help you. If so how will you pay for these resources.
- Get yourself set up with IT, if you are planning to sell online you need to ensure you have the right hardware and back up in place in case of technology problems.
- Unless you have a very niche hobby you will find that others have already taken the step and turned that hobby into a business so competition may be tough. Research your competitors and if possible try to offer something different.
There are plenty of businesses that will help you set up your business and provide you with Accounts, IT, HR and Marketing support. But if you want to use one where you can get all the support in one place by a trusted partner then contact boffix firstname.lastname@example.org.
And remember making your hobby into a business can remove the fun from your hobby but if you are still keen to give it a go then now is a great time to start.