The holy grail for entrepreneurs is success doing something they love, and financial success means earning a living from your business. For many, small business nirvana is building a business that involves something they’re passionate about. To that end, making a living can mean starting with a hobby. The problem is, not all hobbies can be translated into businesses, and not all businesses have the same likelihood of financial success. Determining whether your hobby will make a good business starts with asking the right questions.
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Is There a Market?
Passion is a wonderful thing, and sharing that passion is even better. There is a market for basically everything; just watch the news and you’ll find people willing to pay for virtually anything you can think of. But that is not the same as there being a market for every idea. I may love my homemade cayenne-flavored peanut brittle with sweet and sour dipping sauce, and there may be a bunch of other people who enjoy it on occasion, but that doesn’t mean there’s necessarily a market for it.
In order for your product or service to succeed, your market has to meet three criteria: it has to be large enough to generate sufficient sales, it has to be willing to pay a price that allows you to make a profit, and it has to be accessible. Take my peanut brittle, for example. There may be a large market for it in Asia that is willing to pay $10 a pound for it, but this only satisfies two of the criteria. The problem is that shipping a pound of peanut brittle to China costs $30. That prices my product beyond what my market is willing to pay.
Will I Still Love it?
By its very nature, a hobby is something you do because you enjoy the process and the result. What happens, though, when the result is not for you? Take my peanut brittle again. I enjoy eating the finished product, but it takes hours of tedious work to make. So removing the joy of eating it diminishes the thrill of making it. The question you have to ask yourself is, will you still enjoy your hobby when it becomes a job?
Can I Sell It/Me?
It doesn’t matter what your product or service is–you have to be able to sell it or you to customers. Selling is not for everyone, however. Rejection and the repetition can take the shine off even the most inspired passions. The question of selling is twofold: do you have what it takes to deal with the rejection, and can you explain what you are selling? Whether it’s in writing, pictures, video or in person, you need to be able to explain why potential customers must have your cayenne-flavored peanut brittle with sweet and sour dipping sauce.
Am I up for the Challenge?
The challenge is not one thing; it’s everything. It’s the financial resources to launch your business, and the willingness to work hard for a small return. The challenge is the ability and willingness to wear different hats, including those you don’t like, while getting started. The challenge boils down to one word: sacrifice. Are you ready, willing and able to sacrifice what is necessary to make a go of it?
What if I Fail?
Your business is far more likely to fail than it is to succeed. Being aware of that fact, however, is not enough when it comes to turning a hobby into a business, because this is personal. Opening a store that sells widgets and having it fail because the widget market dried up is unpleasant, but unless you care deeply about widgets, it’s not personal. Failing at something you worked hard at but love deeply is another matter altogether.
Photo credit: flickr