Turning a Side Hustle into a Small Business
Side hustles are great when you’re simply supplementing your income from a job. However, when you realize you have the potential to make more and do more in your side hustle than you ever could working for someone else, and you can live for more than the weekend … then it’s time to turn your side hustle into a small business.
If your hate of the commute, office politics, and feeling undervalued trumps the work you do then it’s time to go. However, you can take the time now while employed by someone else to build your business to the point where it can support you and itself. You can also take this time to financially prepare your personal and business finances for the transition.
Here are some key things to consider as you work on building up your business.
Learn 10 key steps you need to start a business and turn a side hustle into a business.FREE EBOOK: Starting a Business Checklist Guide
1) Return on Investment (ROI)
Always ask yourself what the return on investment is on the action you will take. Money spent should always be an investment that will benefit the business. Some great investments are exposure to your target audience, growing your network, and enhancing your service to your customers and clients.
2) Service
Always be thinking of ways to serve more and better. Don’t chase the money. Don’t start something in your business only because you think it may make money. That’s a great way not to make money. If your product or service truly solves your customer/client’s problem and they trust you they’ll buy. They’ll tell others and refer you.
Also, be of service to your network. When forging relationships with other entrepreneurs and business owners, give value before you ever ask for anything. You may not ever ask for them for anything. When they see or have something that would be good for you, they’ll tell you. I’ve definitely made money and had great exposure from colleagues and partners passing things along to me or simply saying hey I think this is a fit for you, can you do it.
3) Systems
Work on building up your business systems so your business can run more efficiently. The more automation and integration of your business systems the more revenue you will make. Enhancing systems always increases my revenue. Seriously, every time my revenue goes up.
4) Analysis
Every month, review your financial data. In the middle of the year, do a hard financial review to get ready for the upcoming quarters and year. You’re looking to make sure:
– your pricing is right
– your gross margin isn’t too low
– cash flow is consistent
– cash flow is trending up
5) Boss Timeline.
As you’re growing your business, have a plan as to how and when you will transition into a full-time entrepreneur. You should know how much money you need to operate your business every month (your operations number) and the amount of money needed to run your household every month (your survival number).The plan should allow you to earn, at minimum, the combined amount every month before you leave the job.
Take the time while you have your employer as an investor to turn your side hustle into a small business.
