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Five questions to ask before transforming your hobby into a business

Michelle DeClerck is president of Conference Event Management.

On a recent trip, I was invited for an after-dinner drink with a new acquaintance and couldn’t say no when I discovered she had an interest in starting her own jewelry business and we could therefore talk about business ownership for the evening.

I learned some of her friends had encouraged her to consider selling her jewelry instead of giving it away to friends for special occasions or donating it to high-end charity auctions in Los Angeles. I admired the pieces she was wearing and knew she could have a profitable product line. This was the moment I was waiting for, as I was able to share with her some wonderful resources — including the National Association of Women Business Owners (NAWBO) Los Angeles chapter — that could help her jump-start her business.

During our enjoyable conversation, we deviated to other past business experiences, and I regret I didn’t ask all the right questions during our conversation to really get to know whether this was something she really wanted to do, or if her friends just thought she had a great product that others would want to buy. I’m curious how she is going to make that decision and what her deciding factor will be, as money is not her driving factor. 

If you’re thinking about converting your hobby into a business with a strong revenue stream, it’s essential to identify the real reason you want to go into business, and what it will look like for you and your family.

Begin by asking yourself the following questions:

  • Am I prepared to give up the “enjoyment” factor of my hobby and change my focus to filling orders and meeting deadlines?
  • Am I excited to handle the marketing/social media, order fulfillment, purchasing, sales AND accounting side of the work? If the answer to any of these is no, and the revenue won’t allow you to outsource it to others, you may quickly be able to determine that it’s best to stay in hobby mode.
  • Am I willing to invest the time and money necessary to market my product?
  • Do I have a plan for what will happen if I can’t sell enough product?
  • Am I prepared to invest the time necessary to create a strategic vision, seek input from others and listen to their constructive criticism?

While your hobby may be intriguing enough for small requests, do the market research to ensure you can take it to the next level. Friends are great at giving advice and even telling you why something won’t work when you tell them you are open to constructive feedback.

In many cases, if your hobby brings you complete enjoyment, I recommend that you keep it a hobby. But if you really want to take it to the next level, be sure to answer the hard questions first, to seriously probe whether transforming it into a business will deliver the results you desire.

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