vblog_hobby_into_business

Sheltered somewhat from the wild terrain of the ecommerce landscape, the Casual Online Seller can usually be found on eBay or Etsy selling handmade crafts or jewelry, turning their passion for thrifting into a profit, or designing and selling apparel. While for many people it’s enough to make a few bucks off their hobby every once in a while, others might be noticing significant traction on what they’re selling – and may wonder if it’s time to turn that side project into a full-time business. If that’s you, ask yourself the following questions before you decide to take the leap.

 

Where Am I Currently Selling?

Nine times out of ten, before starting their own website, hobbyists will turn to sites like Etsy, eBay, or Poshmark. For people who are just selling an item here or there – especially if you’re in the business of buying fashionable clothing at thrift stores and reselling them – sites like this have a number of advantages: they’re easy (it takes about five minutes to create a listing), the in-platform search competition is extremely low compared to Google, and there’s a built-in community. When considering drawbacks, most people jump right to the fees these platforms charge, which is valid; Poshmark in particular demands a steep 20% commission. But in truth, the biggest drawback is your inability to control your own branding or marketing. With the exception of your name and any copy you write to introduce your shop, your brand is 100% tied to the platform you’re on. For all intents and purposes, this makes you unmemorable in the competitive landscape. The very first step in turning your hobby into a business involves weighing the pros and cons of these platforms and deciding you’re willing to forge ahead independently.

 

Do I Know My Target Market Well?

One of the best parts of starting out on one of the above platforms is that you’ll quickly get an idea of who is purchasing your products and why. You’ll also learn which items are best-sellers – and it may not always be what you were expecting! It can be hard to retain this exact audience as you transition over to your own website, since you’re not allowed to promote any outside websites or social media pages on the listing sites. However, you should be able to paint a complete picture of who your typical buyers are and where you can find them. This is also a compelling reason to hold onto the store name you started with; previous buyers who are interested enough may just go searching for you.

 

What Does the Competitive Landscape Look Like?

Selling handmade jewelry or thrift store finds on Etsy is vastly different from selling online in general, where you’ll be competing against long-established sites and even big box retailers. If your products have a history of being in high demand, there is definitely room for you among the competition. If not, do switch to an ecommerce platform like Volusion and start building up your own brand, but don’t quit your day job until you have an accurate understanding of your idea’s potential and how your products stack up against the competition.

 

Am I Ready to Run My Own Website?

If you’ve made it this far and your answers lean in favor of taking the next step, then it’s time to set up your own ecommerce site! With its built-in ecommerce functionality and user-friendly templates, Volusion makes this pretty darn easy. However, you’ll still be putting in a fair amount of legwork in uploading products and images, customizing your template to match your branding, installing Google Analytics tracking scripts, and more. You don’t need to be “fluent” in code, but we have noticed that many of the most successful merchants are the ones who at least have a working knowledge of tech.

 

Am I Ready to Invest in Marketing?

We hate to break it to you, but want to know what’s not going to happen to your website overnight? Awesome search engine rankings, perfect ad bids, and a rabid fan base. Remember that the sites you’re competing against likely have sizable marketing budgets, and that investing in one marketing strategy alone may not move the needle; it’s really the collection of strategies that counts.

 

What Do My Finances Look Like?

On that note, have you been saving and planning for this? Did you take out a small business loan? What were your profit margins previously, and are you prepared to stay in the red for a significant period of time as your business picks up momentum? If you don’t have enough money set aside to live on for six months to a year, it would be wise to keep your day job and set aside a few hours each evening to build your business. Gradually, you could drop to a part-time job until you feel confident running your business full-time.

 

Are My Taxes in Order?

If you do decide to turn your hobby into a business, that has tax implications. At the very least you’ll need to start looking at 1099’s so you can pay taxes on your “miscellaneous income,” but it would be better – and more affordable – to get the LLC ball rolling so you can start handling business-related expenses. If your tax knowledge is as limited as mine is, get thee to an accountant!

 

How Much Time Does My Business Take?

On the most practical level, most people decide to switch to a full-time business when they’re handling so many orders and other business logistics that it becomes imperative. This is a good thing! If you can’t keep up with customer demand without working full-time, that’s perhaps the best sign that you’re ready to do this.

 

Is My Business Scalable?

Of course, it’s possible that you can’t keep up with customer demand because your hobby itself takes a ridiculous amount of time. This is one of the biggest lessons hobbyists learn as business picks up: sometimes it’s just not possible to continue hand-sewing apparel or hand-making your crafts. If this is the case, you have a couple of options. First, you can pivot away from the handmade goods and find manufacturers that can match the design or spirit of your products. If “handmade” is an absolutely essential selling point for you, then make sure the price point of the products can match the amount of time and labor you put in – and make sure people are willing to pay that. Did you set your price high enough and you’re still swamped with orders? It’s time to hire someone!

 

Do My Other Commitments Allow for a Full-Time Business?

Last but not least, what else is going on in your life? If you haven’t noticed the theme yet, full-time businesses take a huge amount of money, energy, and…well, time. For a small business owner, at least at the beginning, it’s not uncommon to feel like you’re working around the clock. So make sure you’re able to carve out that time, that your family will be sympathetic to your hectic schedule, and that you don’t have any financial or medical issues to address first. If all of that is in order, then you’re ready to go. Good luck, and remember how many hugely successful ecommerce businesses started as a side project!