The trend towards home-start businesses has been steadily on the rise for the last five years. Between the economy dropping, unemployment rates rising and the desire to be our own boss, many “work at home” companies have sprung up.
Affiliation sales, writing for money, MLM schemes and many other entity driven online businesses are only some of the options you as a freelancer or entrepreneur can try to get your feet wet. What if you would rather take one of your hobbies and turn it into a business?
Before you grab the knitting needles, the crotchet hooks and yarns, or wood and saws sit down for a spell. Here are a few points to consider carefully before jumping in with both feet. An old saying tells us that “Forewarned is forearmed. When you depend on your income from selling your home created goods for a living this holds twice as true.
Do you have the workspace and materials you need to be able to create your products?
When talking about knitting, crocheting, sewing or writing that might sound funny at first, but once you start up in earnest the need for a dedicated space and a decent amount of raw materials becomes apparent quickly.
A dedicated work and storage space in which you can feel comfortable, can work without distraction, and can leave your work in progress without the fear of it being disturbed is extremely important. This space should also include a storage area for finished projects and in case of crafters the necessary materials.
Do you have the necessary start up cost?
Can you afford to purchase the necessary materials to finish at least 10 to 15 items? In order to get any Business started you need a minimum inventory. While it may seem wise to try just one and “see how it goes”, this is neither realistic nor good business practice. You should always be able to offer your potential clients a variety of options to choose from. If there is only one item in your store, you will only make a sale if someone is looking for exactly that item at exactly that price. Remember that tastes vary from client to client, and by offering several different products you increase your probability to clinch a sale.
You can create until the cows come home, but if you have nowhere to sell your products they will sit and gather dust. Ebay is one of the best known auction sites in the World right now, but for handcrafted items it is not the most favorable place for sellers. You may be able to set up virtual shop at Etsy.com instead and try your luck there. Remember that you will only be one of thousands of Sellers online who are trying to do the exact same thing. You might want to look for real time sales opportunities locally or at Arts ‘n Crafts Fairs as well.
Do a little bit of market research first and find the necessary markets for your products, so you have a venue once your product is ready to go live!
Are your products of comparable quality to similar items for sale?
Remember another painful truth; everyone loves your home made items as long as they don’t have to pay for them. Once you start putting a price tag on something, the situation changes. So make sure you have more then just Aunt Suzie and Uncle George who are interested in what you make. Study and research information which will allow you to offer comparable quality products to those already on the market. Each item you sell can either increase or decrease your customer return ratio and word of mouth advertisement. Be sure that your talents and productivity are up to par before getting started.
Do you have the necessary time to create enough items to sell?
A lot of people forget that once you go from purely doing something as a hobby to trying to make it into a “hobby business,” a complete shift of attitude and tenaciousness is necessary. Where before hand you were able to stop when you got bored or could work around your every day errands and chores, now you need to be able to set x amount of time away daily in order to produce your wares. It is important that this time is available to you without constant interruptions or distractions.
When anything becomes work it eventually loses its charm. The shift occurs when your mind realizes that now you no longer get to do it but have to do it. Even reading it makes you feel slightly different, doesn’t it?
There is great satisfaction in creating something beautiful and there is a wealth of pride to be had when you start listing your items for sale. This in itself is a moment of success, but now comes the hard part; dealing with the reality that your work might not sell for quite some time. It is your job to help bringing your products into the eyes of the public.
Remember that when you sell anything, you are competing against thousands of other people with a similar idea. These days you are also competing against low income, job loss and restrictive budgets. Not an easy situation by any means. Further more you are dealing with the “throw away society” mindset we have developed. Most consumers would rather buy cheap and replace often, then pay for handcrafted quality which is by its nature more lasting but also costly.
In other words, you are not only going to be responsible for creating the items, but will need to be your own PR Firm, Sales Manager and more. You are running the front and the back end of your particular business. This requires you to be very driven to make this work. The one consideration which often made you dream of working from home via your own Business, being your own Boss, can now become your biggest pitfall. Do you have the single mindedness it requires to make yourself work the allotted hours daily without someone driving you on and without the promise of an hourly wage?
Do you have enough money set aside to hold you over for a little while or another regular income to help you provide?
Unless you are extremely lucky (and a smart person never counts on that) it is going to take you anywhere from 1 to 3 years before your business is going to be lucrative enough to sustain your household and your business necessities. Most of the time you won’t even see more then 4 to 6 sales in the first few months and that will hardly pay your mortgage. This means you either need to have enough savings to cover the bills until your business generates a stable customer base and steady sales, or have a regular income either via another job or a secondary person in the household.
You need to recognize that your business will be in the “red” for an extended time during which you still need to keep up all your regular obligations as well as supply the necessary materials to keep your business flowing. Not an easy task and something you need to be able work out before you get started.
Be certain to consider your financial circumstances carefully before starting!
Do you have a support Network in place?
A good support Network can be your best friend and is a huge necessity when starting out. If you are depending on a secondary person’s income to help bridge over the time until you are lucrative in your own right, you must make certain they are ok with it.
There will be times you are going to be discouraged and ready to give up. You will grow tired of working constantly and seeing very little income in return. There will be times you are going to get burned out and just start feeling isolated from others. During all those times it is extremely important that you have friends and/or family who can come to your emotional and mental support. Having someone there who is willing to let you vent and ready to encourage you can make a huge difference in the long run.
