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Whether you’ve got a passion for creating jewellery or perhaps you’ve got a keen eye for vintage clothing, maybe you’re amazing at SEO, or you love walking dogs, there’s no better time to turn your hobby into a bona fide business.
And you’re not alone. Millions of workers have left their jobs to start their own businesses. From outdated work practices to simply no longer enjoying their old roles, long commutes to feeling underappreciated, whatever your reason for starting a business, we’ve got some tips to help you on your way to success.
Do your research
Before you begin, you should do your research. Is your idea viable? Are there already people doing what you’re doing, or will you have a captive market?
Consider if your idea will provide you with enough income to survive or if you’ll need to supplement it with a part-time job – at least in the beginning.
You should also think about your target demographic and how you will attract them.
Create a business plan
Once you’ve done your research and if you think your passion project can be scaled up to become a business, you can create your business plan.
You’ll want to include a description of your business; even if it’s just you who’ll see the plan, it will help provide you with much-needed focus.
Your plan should also contain competitor analysis, as well as financial forecasting, operational information, and long and short-term plans.
You will need to make initial investments into your business to get started; however, prioritising which things to invest in is crucial for success. If you are starting a company working on homes and construction projects, for example, investing in the tool boxes and tools to be used on your projects will help you to get started working on client jobs. Whereas investing in new tech equipment upgrades will be costly and won’t provide an immediate benefit of cash increase for your new business. Make sure to prioritise the things you invest in first and that they help you to start, grow and run your business.
Decide your business status
When you begin operating as a business, you’ll have to choose the right business structure as it will have implications for how you set up and even how you pay tax.
Sole traders are the most popular business status for start-ups. They are responsible for running their business and meeting all the legal requirements, including registering for self-assessment. Operating as a self-employed sole trader is easy to set up and relatively low cost; however, you have full personal liability for the debt.
Understand your finances
While the final aim of any business is to be profitable, you’ll want to first consider how you’re going to fund your business. Will you be using savings, or will you need to take out a business loan to help fund the initial costs?
No matter how you fund your business, you’ll need to be realistic, keep on top of your finances, and accept that it takes time to build a profitable business.
Ask for help
Perhaps the most important advice for starting a business is to ask for help. Don’t be afraid to speak with experts. Learn from the mistakes of others, and don’t be too wed to your initial idea. Businesses need to change and adapt to stay relevant.
Suggested reading: S corps have a variety of tax benefits for business owners. Read more about how to start an S corp in California with TRUiC’s free guide.
You may also like: How To Create a Business Based on Your Passion
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