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6 steps to turn your passion into profit

6 steps to turn your passion into profit

Ever dreamt of running your own business? That one day, you’ll stop devoting your working hours to someone else’s profits, and create your own business based on a real passion?

More Britons than ever are making it come true, according to a recent study.1 It found 37% of UK entrepreneurs had turned their hobbies and interests into businesses – from pet transport to picture framing, from bread-making to bicycle design.

Digital technology has spurred the trend, and seems set to swell the ranks of small businesses beyond the current record 5.2 million2 – so what are the key points to consider before joining them?

1. Defining your passion

It could be a craft, a hobby or a sport – but it might be something you just feel very strongly about.

When her son was diagnosed as gluten-intolerant, Lucinda Bruce-Gardyne grew frustrated trying to find a tasty gluten-free loaf. She experimented with her own creations in the kitchen. Today Genius, her range of gluten-free products, is stocked by Tesco, Sainsbury’s and Asda and sold internationally.

Mark Harries’ passion was similar: he wanted the most nutritious, tasty baby food for his new-born son. And he wanted to spend time with his son, rather than commuting to and from his job.

Now Mark works from home, selling baby products online through his company, MushyMushy. 

“Making the leap was easy,” he says. “I was deeply unhappy at work and if I didn't do something I'd miss seeing my son grow up. This keeps me going when I sometimes feel like quitting.”

His advice to other budding entrepreneurs: “Don't quit your job first. Do what it takes to get up and running with your venture and get some cash flow. Contact people who have done what you've done, and see if they'll have a chat to impart some wisdom.”

2. Testing the market.

Leaving the day job to focus on your passion can be exhilarating – but it’s often wise to juggle them in tandem for a while until the viability of your enterprise is clear.

When Debbie Orr gave up her publishing job to focus on her passion for knitting and colour, she had already been selling her hand-dyed yarn products online.

The business was born out of frustration with the yarn products available: “I had always been a knitter, and I found that yarn shops often sold acrylic,” says Orr.

“I came across a magazine article about dyeing with food colouring, and tried it out in my kitchen. Then I went on a course to check I was using the right techniques, and moved on to professional dyes.

“When I started to sell on the Etsy creative marketplace, I had my first sale within 24 hours. Etsy allowed me to test the waters before setting up in business full-time.”

Nine years on, Orr’s Berkshire-based business, Skein Queen, is turning over £70,000.3

3. Build your community.

Having established that your market exists, you need to let them know about your business and what it offers. That means establishing an ongoing relationship, whether face-to-face or via digital channels.

Many small businesses harness social media to connect with their market base and promote their product or service. Niche networking sites can be a particularly powerful resource.

“A couple of years after I started in business, a site for knitters started up, called Ravelry,” says Debbie Orr. “There are several million people on there – it’s a great way for me to see what people are knitting and follow the trends.

“Instagram and Twitter have also been brilliant for getting the word out there; Facebook is a bit hit-and-miss. I also travel to specialist shows and hold occasional open days at my studio.”

4. You don’t have to go it alone

Your business is your baby, and you’re going to do it your way. But don’t underestimate the potential support to be gained from those who have had similar experiences.

“Running your own business is hard work, particularly in the early stages,” says David Stallon, Commercial Director at the Federation of Small Businesses. “You’ve often invested a not insignificant amount of your own money, certainly a large chunk of your own time, and an unquantifiable amount of emotional investment into getting this dream off the ground.

“One great way to find support in that early period is to join a business membership organisation like FSB. You’ll be able to get valuable advice and share experiences with other small firms through networking events.”

Outsourcing tasks such as administration – or taking on an employee – can allow you to focus on the part of the business you’re best at. But if you recruit, it’s vital to find someone who shares your enthusiasm for the business, and to ensure they stay motivated.

Two years ago Debbie Orr took on her first employee, a studio assistant who helps with yarn winding, labelling and dispatching. “I was really lucky to find someone who is equally passionate about the business,” she says.

5. Be ready for growth.

Business growth can take entrepreneurs into unexpected territory, with technical and emotional impacts.

Debbie Orr’s yarn business is about to hit the next level. She is considering expansion into a light industrial unit rather than continuing to dye at home.

“I’m still under the VAT threshold, but as we grow we’ll need to look at that very soon – it’s a huge change for a small business,” she says.

As the business grows, she is also keen to maintain the passion that inspired it in the first place. “I still love colour and knitting, but it is a job and it’s very full-on now,” she says.

It’s easy for business owners to find their personal time entirely consumed by work at this stage. Stallon counsels entrepreneurs to set clear time windows for tasks and stick to the schedule, so they can still enjoy some down time.

Orr agrees: “You have to make an effort not to always be working weekends and evenings. And you have to try to keep a bit back for when you want to do your hobby as a hobby, not just a job.”

6. Have the confidence to do it – or not to do it!

It pays to think through all the issues above, and to do the most thorough research possible. But at some point, you need to summon the confidence to make the leap.

And remember that the entrepreneur’s life doesn’t suit everyone. If you know you couldn’t stomach the all-consuming work of being your own boss, then look for a job that allows you to follow your passion as an employee. You’ll still be in the minority who make money by doing what they love.

Sources
1 Weebly study, 2016:
http://www.startyourbusinessmag.com/more-than-a-third-of-entrepreneurs-have-turned-their-personal-passions-into-successful-businesses-according-to-biggest-ever-uk-research-by-weebly/
2 Business population estimates, BIS, 2014:
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/377936/bpe_2014__methodology_note.pdf
3 Source: Debbie Orr

Important information

This article has been provided to Lloyds Bank by external/third party contributors and contains their views as of August 2016 and should not be relied upon as fact and could be proved wrong. The information and opinions may not be accurate after this date. The views expressed may not reflect the views of Lloyds Bank plc and are not intended to provide legal, tax or financial advice.

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