Can Your Hobby Be Turned Into a Money-Making Empire?

 The comfort and security of 9-5 life is losing its sheen. More people are turning their backs on the certainty of regular pay cheques and going into business for themselves. Thanks to technology and the internet, we’re all now realising you can work hard and earn money doing something you love. Isn’t that the dream? 

What was once considered a hobby or passion-past-time is turning into a realistic income stream.  

In a 2015 study by Upwork, they identified 32% of Aussies were freelancing (roughly 4.1 million). 

Latest ABS statistics showed there are 1.2 million registered sole traders operating in Australia. There are also 599,000 micro businesses (small businesses with 1-4 employees). Australians are increasingly embracing the freedom and flexibility of running their own business. 

These numbers prove our economy can support this exciting new way of life. But, can your hobby be turned into a money-making empire? 

Here’s what you need to consider: 

Is your hobby worthy of a business? 

Have you done any market research? Do you have a business plan for it? Does something similar exist? How much are people willing to pay for your product? Just because your mum thinks you’re creative and frames all your work for her walls, doesn’t mean it’s a business that can generate enough income for you to survive on. 

Cost to create : profit ratio 

Whether you’re a writer, photographer, jewellery-designer, painter, or clay architect – how much does it cost you to make your product, and, is that cost comparable to what people will pay? 

My friend makes the most beautiful paper art. She’ll spend hours of her time (in addition to buying materials) meticulously creating these big, beautiful, paper art masterpieces. She creates the art because she enjoys it. She enjoys it so much she tried to turn it into a business. 

Only, when the time came for her to price her masterpieces for sale – she realised she’d have to charge hundreds of dollars to cover her time and materials. How many people do you know will pay hundreds of dollars for paper artwork? Unfortunately for my friend, she learned the hard way it wasn’t a sustainable business idea. 

Will you still enjoy it? 

If your hobby is a passion because it helps you relieve the pressures of your life – will you still enjoy it when you rely on it to pay your bills? What about after you’ve just churned out 50,000 of your cute handmade [insert product here] pieces? What you once turned to for creative release might become stressful, and you may come to resent it. 

How to Test Your Hobby Business Without Going Broke! 

If you’ve taken on these considerations and you still want to pursue your hobby business, there are ways you can do it safely without going broke. 

1. Keep working with your employer and start building your business in your at-home time. Yes, there will be long days and many a weekend worked, but, at least you will know whether you’ll enjoy doing it full-time!
   
2. Start building your emergency fund while you’re still employed. Aim to have at least 6 months-worth of your expenses saved in an account – and add an extra $1,000 for good measure. That way, should it take a little while to build momentum, you’re not stressed out drowning in bill debt.
3. Test the waters to confirm people like your product. If you are creating art pieces, like paper art, jewellery, paintings, or photographs, rent out space at your local markets and try selling them one weekend. If you sell out – you’re probably onto a good thing. 

Preparation is Key 

We all dream of earning money from our hobbies because when you enjoy something so much it doesn’t really feel like you’re working at all! But, it’s important you don’t jump in too fast and spiral into debt because you didn’t prepare. You’ll resent your hobby and your life and find yourself crawling back to your old boss with your tail between your legs.  

Do your research before you start. Get a business plan in place and prove that it’s a sustainable business idea that can generate enough income to support your desired lifestyle.  

If you are looking to start your own business, get in touch! We can put a solid budget management plan in place to prepare you for your change in circumstance.