Turn a Hobby Into a Business
5 Tips to Turn a Hobby Into a Business
If you have a hobby or pastime that you enjoy, you might think you’d like to turn it into a business. After all, what could be more satisfying than combining your passions with your career? Anything else would feel like a compromise. If that sounds like you, read on to find out how to turn a hobby into a business.
Turning a passion into a profit isn’t as straightforward as it may seem. You’ll need to do some research and analysis before starting up any business venture, let alone one based on something you enjoy outside of work hours. Luckily, there are many examples of people who have successfully turned their hobbies into businesses. Here are three ways to do the same with your own pastime:
Create something your audience wants
If you have a hobby, you’re already deeply familiar with your niche. You probably know what your specific audience wants and how they want it presented. Now, take that knowledge and apply it to a product or service that you can sell to your audience. This doesn’t mean you should start making knockoff versions of your favorite hobby items.
Instead, create something new based on what you know is missing from the marketplace. For example, if you’re a knitting fanatic, maybe you’re sick of wearing ugly acrylic sweaters in the winter. Investigate your audience’s needs and wants, then create knitwear that will keep them warm and stylish. You’ll be creating a product no one else is providing.
Do I have what it takes
In order to turn your hobby into a full-time business, you’ll need to be smart, dedicated, and ready to work hard. You’ll need the right skill set to create a product or service that people want to buy. You’ll also need to be able to market that offering. This might be something you’re already good at, or it might be something you’ll need to learn as you go along.
In other words, you’ll need to make sure your hobby is something that you have the skills to turn into a career. A knowledge of bookkeeping and record keeping helps also Say you’re a runner, can you become a certified trainer? If you love to knit, is there a way you can sell your creations online?
Build a platform for your hobby
Maybe you have the skills to turn your hobby into a full-time job. However, your specific passion might have a small audience. Or, it might be very difficult to turn into a salable product or service. If this is the case, you might want to build a platform for your hobby. This could be as straightforward as writing a blog about your pastime.
You could also consider starting a podcast, or creating a YouTube channel around your hobby. This will give your audience a place to interact with each other. It will also give you the opportunity to provide value. That way, when the time comes to ask people to buy whatever it is you created, they’ll already be familiar with you and the quality of your work.
Turn your product into a service
Let’s say your hobby doesn’t lend itself well to either creating a product or building a platform. That doesn’t mean you should give up on turning it into a career. You can always turn your hobby into a business by offering a service. A great example of this is things like yoga or meditation.
These practices have been around for thousands of years, but in the past decade, they’ve become incredibly popular in the West. That popularity has led to the creation of many different types of yoga and meditation classes. If you’re good at yoga, but you don’t want to open a studio, you can turn this hobby into a service by becoming a yoga instructor for hire. This option is great if your hobby isn’t easily turned into a product or a platform.
What does the IRS require for a business?
If you decide to turn your hobby into a business, you’ll need to consider the Tax Code. As a general rule of thumb, you’ll want to be profitable after two years, but this is not a hard and fast rule. That way, if you don’t succeed, you can claim it was a hobby and not a failed business venture. You can also deduct business expenses, including things like your computer, internet service, etc. Here are nine basic items that the IRS uses to define a business, and not a hobby.
To be honest, you’re probably better off keeping your day job and turning your hobby into a side hustle at first. This will allow you to invest your time and energy into growing a profitable business on the side. Your hobby could also be a business, but it’s essential to check with a tax professional before making any decisions. You need to be aware too, that the TCJA that went into effect January 1, 2018, doesn’t allow you to deduct any expenses for a hobby. You are required to claim all income however.
When it comes time to turn your hobby into a business, the first step is to ask yourself why you want to do it. That’s because your hobby isn’t just something you do for fun, it’s also a part of who you are. And if you want to build a business around that part of yourself, you need to make sure you’re doing it for the right reasons. From there, you want to make sure you’re creating something your audience wants, and that you have what it takes to succeed.
You also might want to consider turning your hobby into a platform or a service. In any case, turning a hobby into a business is challenging, but it can also be incredibly rewarding.
- Turn a Hobby Into a Business - March 15, 2023
- 9 Tips to Help You Prepare for Income Tax Filing Online - March 8, 2023
- Filing Self Employed Tax Return Online - March 1, 2023