Mediaboss Marketing

Do your research

Find out what the market is like for the product or service you are offering. How many other people are offering the same, or similar? Do they seem to be busy? How much do they charge?

Some particularly profitable hobbies include making quality bespoke goods such as jewellery, wall hangings, buying and reselling vintage fashion, or services such as music or language tutoring and gardening.

Think, too, about where you see these services advertised. Etsy, for example, is a great place to sell crafts but sites such as Fiverr and TaskRabbit are better for selling skills, such as home improvement or writing services.

Make sure you are clear on any regular costs incurred by selling your services or products on these platforms.

Etsy charges 15p for each listing and asks for a 5% fee when you sell. If you make a sale directly through its offsite advertising, it charges a 15% fee.

It is free to set up on TaskRabbit it adds a standard service fee on to your clients invoice, as well as any VAT.

Fiverr, meanwhile, takes 20% of every transaction and charges your clients a service fee.

Does the cost justify the profits you stand to make or would it be easier to sell via social media, on sites such as Facebook Marketplace?

Dont sign up to anything that costs money until youve considered your options. The last thing you want is another bill that adds to your monthly expenses rather than helping alleviate them.

Deciding on the perfect price point is key to the success of your side project. You want to charge a figure that is competitive, will satisfy your customer, and bring in the money you need to make a profit.

To do this, consider your costs for making a single item or providing a service. How much will raw materials, posting and packaging, travel expenses and more, add up to? Can you lower these costs by buying some items in bulk or exploiting supplier discounts?

If you are selling something you make, consider, too, how long it takes and your level of experience. If, for example, it requires days of work to make a single piece, the price should reflect that.

Consider what the price you are thinking of charging converts to as an hourly rate, and decide if that is reasonable. If you are providing a service, this will be more straightforward and easier to compare with the market.

If in doubt go over, rather than under. It is far easier to reduce the price than it is to increase it.

Think about who your typical customer is likely to be and where they might look for a product or service you are selling. Are they social media users or using search engines such as Google to locate what they need quickly? Do they live locally, or are they spread across the country?

It can make sense to do your marketing and sales in one place. For example, if you set up a storefront on Instagram or Facebook you can grow your audience on the same platform via hashtags and content. These are free to set up and launch.

If you want to upgrade for greater reach and management options when you become more established, there are a number of pricing plans via software companies such as Ecwid that allow you to do so from 19 a month.

Alternatively, you can set up your own website for free via sites such as Wix.com and use social media tools purely for marketing purposes.

Take advantage of classic PR and marketing opportunities by offering comment to journalists looking for information about your products or areas of expertise, sending samples, or guest blogging for sites that target the type of audience you are trying to reach.

Local free magazines and forums are a good place to get your name known.

Dr Nikki Ramskill turned her hobby of blogging about personal finances into a small coaching business, the Female Money Doctor, which she runs alongside her main job as a GP. She charges 1,050 for a bundle of six money coaching sessions, as well as providing free resources and low-cost planning advice to those who need it via her website.

Stay organised, she says. Dedicate a time to work on your project, and do a little towards it every day, even if it is just posting a listing on Etsy. Be gentle with yourself and realistic about how much you can achieve around your main job.

She also recommends keeping marketing and admin tasks small and not letting perfect be the enemy of good.

Master a handful of things first, she says. No one is amazing at social media straight away, it evolves as time goes on and you adapt. It doesnt have to be perfect either. Dont spend hours choosing a colour for your logo, for example. You can always adapt it further down the line.

Set up an account for your hobby to separate your earnings from your personal finances, and consider using digital tools to stay on top of your taxes.

Any side business earning upwards of 1,000 a year must be declared to HM Revenue and Customs, and you need to complete a tax return at the end of January each year or face penalties and fines.

Enzo Ottens is a co-founder of the fintech app Earnr, which allows you to track how much income tax you owe as you earn before you earn 3,000.

One of the main things we try to warn people about beforehand is to think about whether to set up a limited company, he says. Mainly because of the additional admin that comes with that the balance sheets, the statement of accounts and the hundreds you will end up paying an accountant to manage it. We recommend setting up as a sole trader first.

We also see a lot of our customers register with HMCR too early even before theyve made 1,000 in sales. And then they have to do a tax return even though they may not yet have made those sales.

Other products aimed at those running small businesses include NatWests Mettle account, which allows you to create and send invoices on the go and prepare your accounts for taxes, and the SumUp app, which creates payment links you can send to customers and clients. Both are free to set up.

See the original post:
How to turn your hobby into an income stream - The Guardian