In the era of having multiple income streams, many people have found a lot of success when it comes to their side hustle. Many people who start a side hustle soon find themselves thinking about whether they could transform their side hustle into a full-time business venture, and become their main source of income. However, turning your side hustle into a business may take a lot of steps, and can also take a lot of time, effort and money. Here is everything that you might need to consider before turning your side hustle into a full-time business.
Generate A Business Plan
One of the most important parts of turning a side hustle into a viable business is having a solid business plan. Many people don’t do this for a side hustle, as side hustles mainly focus on making small amounts of money. A business plan will outline both your short and long-term business goals and will also walk through other aspects of your business such as marketing, sales plans and other funds. It is one of the best ways you can keep a clear idea of what you want your business to look like and help you keep on track, as you turn your side hustle into a full-time business.
Crunch The Numbers
Having a good idea about your business’s finances is one of the best ways you can create realistic goals and predictions for the expansion of your business. You need to be sure that your business generates enough revenue for you to live on, so you can cover living expenses and so on. You should have an emergency fund for yourself, in case your business goes wrong. Having a good idea about your business funds, cash flow, and revenue is a good way to ensure that transforming your side hustle into a small business goes smoothly.
Understand How To Expand
When you make the decision to transform your side hustle into a small business, you will need to understand how you can expand. If you don’t have a good idea of what you need to do in order to grow your business, you will fail during the transformation process. For example, do you need to build your digital presence and marketing in order to get the word out about your business? Do you need to do a small rebrand, build a website, or get better marketing? Knowing how you will expand your side hustle will allow you to transition it into a functioning small business.
Develop Your Customer Base
If your side hustle is making enough money for you to consider expanding into a small business, you will most likely have a dependable client or customer base that is buying from your side hustle. Identify the demographics of your existing customer base, and identify why they come to your business. This will allow you to find your customer base and target market, which will make marketing and advertising much easier. It will also help you when it comes to refining your products and services, as you will know what is more likely to work with your target market.
Have Realistic Expectations
One of the main stumbling blocks for entrepreneurs who try to expand their side hustle into a small business is they aim for unrealistic expectations and fail because they tried to meet them. When you start expanding your side hustle, don’t expect to be making 6 figures within the year. Many people set themselves unrealistic expectations and goals, and they quit early because they can’t meet them. Transforming a side hustle into a small business takes a lot of time, effort and money – don’t expect to see success overnight.
Set Your Business Goals
When you’re setting goals for your small business, you need to consider objectives related to revenue and what you can realistically achieve with your funds and resources. Make sure your goals are realistic, clear, simple, actionable and measurable. This way, you will find it easier to meet these goals and find business success. You should make sure to set out both your long-term and short-term goals, so you can ensure that you’re on track during every step of the process. Your business goals will allow you to keep on top of your successes and failures, so make sure that they are as clear and accurate as possible.
Identify What Skills You Will Need
One of the most important things you can do to secure the success of transitioning your side hustle to a small business is to identify which skills you will need to acquire, or outsource. You only have so much time in a day, so you should concentrate your efforts on the tasks which utilise your best skills and talents. You should also identify your weaknesses and outsource someone to do them – for example, if you’re bad at bookkeeping, hire someone to do this for you. This way, you can focus your talents on the things that you are good at.
Ensure That You Pay Yourself
Many people who start small businesses fail because they forget to pay themselves, and they cannot afford to pay their living expenses. Transitioning from a side hustle to a full-time business isn’t easy, so you need to make sure you’ve got enough money to live on, and you’re looking after yourself. You need to be able to afford to live, and also have time away from the business, so you can recharge and renew. This is one of the most important things you can do to secure your success – burnout is one of the worst things that can happen to an entrepreneur.
Have A Way Out If You Need It
One of the best ways you can protect yourself when expanding your business is to have a deadline and know when you need to leave. There is no point atrophying money into your business if it is going to fail, and going into a lot of debt to support your dream. You should know when you’ve hit your limit and you need to quit, so you don’t ruin your chances of starting another business down the line. This is one of the best ways you can protect yourself whilst taking the leap in this new business venture.
Protect Your Business
When you expand your side hustle into a small business, you will need to take extra steps to protect it that you wouldn’t with a small business. For example, you should have an emergency fund and insurance when you expand. You may need cyber and data insurance, work with credit insurance brokers, business interruption insurance and more. Investing in your emergency funds and insurance is the best way to protect your business in case the worst happens, and help you transform your side hustle into a proper business.
Transitioning your side hustle into a small business can be long, and take a lot of effort. However, it can be one of the most rewarding things you can do in your life – make sure to do some of these things when you’re starting a small business.