For many of us, the thought of exchanging the daily 9-5 grind in favor of a passion pursuit sounds downright dreamy – especially if you’re stressed out, burned out, or strung out in your current career.
With so many new businesses starting, it’s hard not to be at least tempted by the allure of being your own boss. But romanticism aside, there’s a lot to consider before making the leap. So how do you know if you’ve got what it takes to turn your hobby into a jobby?
Signs that it’s time
- You can pay your bills.
- You’ve gotten to the point where sales resulting from your monetized hobby can confidently cover at least the majority of your living expenses.
- You’re losing money because of missed opportunities.
- When you find yourself having to turn down paying work from your side gig due to time constraints of your full time gig.
- You’re working all the time just to keep up.
- When you always seem to be burning the candle at both ends to keep up with the increasing demands on your time.
- Your quality of life is suffering.
- You’re constantly stressed and missing out on family events and things you love doing for yourself.
Giving up the safety net of job security, a dependable salary, benefits, and the consistency of a regular schedule is a huge decision, and not one to be taken lightly. Before you turn in your walking papers, consider these 11 things to help you mitigate risk and start living the dream:
An existing, profitable venture
Having an existing side business that has a proven track record of profitability before quitting your day job is a must. A wing and a prayer just won’t cut it.
To ensure you’ve got a venture that will stand the test of time, ask yourself:
- Does the solution/product satisfy a growing need?
- Will it appeal to a large enough market?
- Is the problem it solves widespread enough to justify dedicating a business to it?
- Is it scalable?
- Is is sustainable?
A business plan
A good business plan doesn’t need to be complex, but it does need to be thorough. It should include a profile of your ideal client, a description of their needs or goals, your solution (what you have to offer), your business model, your competitive advantage (USP), and a detailed financial summary.
A marketing plan
Spend plenty of time researching the market for your solution to ensure there’s enough demand for what you’re supplying and that the market is not over-saturated. Then, come up with a unique selling proposition (USP) to set yourself apart from your competitors.
If you’re new to market research, check out the Small Business Association for help.
Profile your ideal customer, then put together a customer acquisition strategy to lay out how you’re going to go about landing them. Market only to your niche. No need to waste time and money on low ROI mass marketing efforts.
A financial plan
Develop a well thought out budget. Items to consider include your sales forecast, start-up costs and operating expenses, your salary, benefits, and any potential tax responsibilities.
Cut costs wherever you can. Create specific, realistic financial benchmarks and work toward them. Refer back monthly to be sure you’re staying on track and adjust where necessary.
A life plan
Define what’s important to you and prioritize, then make a schedule and stick to it. Set boundaries. Don’t let time with your family and friends slip away, and always make sure you set aside time for yourself. You have to have time to relax and enjoy life. Otherwise, what’s the point in making the move?
A growth plan
When you’re responsible for your own income, sustainability is essential, but it’s not enough. Your venture needs to be scalable enough for growth. It’s the difference between surviving, and thriving. Envision how you’re going to make this last for the long haul. Try researching how others are making a similar business work.
Even if you’ll be spending a lot of your time out on the road, get yourself a dedicated office space and any equipment you may need. A computer, a printer, a separate phone line or even a Google phone number (it’s free), a filing cabinet, and a place to do administrative tasks are all essential to the self-employed. Having a home base helps keep things organized, and it helps keep your home life separate from your work life.
If you’re in business, you need a brand. Some essential elements include a business name and tag line, a URL/website, a logo, any print collateral (business cards, postcards, brochures, etc.), professional photography (headshots, product shots), and marketing copy. Set up shop online with a website and secure your social media venues, so you have a platform to work from.
Being your own boss is not for everyone. It takes a certain type of person to sustain self-employment long term. Before diving in, you need to do a bit of soul searching to make sure this is truly right for you. Most successful entrepreneurs are risk-takers who are flexible, resourceful, diligent, thick skinned, and highly committed. Does that sound like you?
The right timing
Life twists and turns and there’s no telling where you might land at the end of any given day. Being an entrepreneur won’t change that — in fact, it’ll probably make things less predictable. That’s why making sure you’re in a good place to make a major life change is so important before you quit your day job.
First, make sure you don’t have any sizeable expenses on the horizon. Things like your kids heading off to college, a new baby on the way, a health concern, or any other potential major outflux of cash are all reasons to postpone venturing out on your own.
While you can’t escape bills, less is more when it comes to the financial obligations of an entrepreneur. Ideally, you’ll want to be free of significant amounts of debt, including credit card debt, and have enough savings to sustain you for at least a full year before you make the decision to transitioning over.
Having your own personal cheering section of family and friends is always invaluable. As an entrepreneur, having a professional network to bounce ideas off of or to collaborate with is also key. The business ownership journey can be bumpy. Having a cache of people to help keep you on track will serve you well.
Before you decide to bid your employer adieu, get your legal ducks in a row. Make sure you don’t have a non-compete clause, or other legal barrier that might prevent you from working on your venture.
Then, set up a business structure for tax purposes, get an Employer Identification Number (EIN), get your systems in place, and you’re on your way.
Working for yourself offers delicious freedom, but with that freedom comes great responsibility. Even the best intentions can fall flat when not properly planned for and nurtured. Stay the course, stay true to yourself, and remember why you started and you’ll shift from hobby to jobby like a boss. Literally.
Don’t forget to subscribe to Café Quill for more invaluable advice including tips on how to work well with introverts.