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Can your hobby become your business?

Can your hobby become your business?

posted in SCORE 87 Post by Tom Hellmen

Running a successful business centered on doing something you love is the dream of many entrepreneurs. What could be more gratifying than making a living sharing your talents and skills with others?

It’s not difficult to find success stories about everyday people—from photographers to interior designers to carpenters and others—who have turned hobbies and interests they were passionate about into viable businesses.

Our experience has shown that leisure-based founders, those that can focus exclusively on the soon-to-be business are more likely than others to generate revenue, achieve a profit and have a deep commitment to their business. That is encouraging if you’re contemplating making the transition from hobbyist to small business owner. It’s important to know, however, that not all hobbies (and the people participating in them) may be well suited for entrepreneurship. Here are some essential points to consider as you explore the feasibility of your hobby becoming a sustainable business:

  • Will you still enjoy doing the work after you have to do it (versus having the luxury of doing it only when you’re inspired to)?
  • Are you willing to put yourself out there? It’s one thing to work on your hobby for your own satisfaction and another to put what you produce out there to be scrutinized by others.
  • Will people (and enough of them) be willing to pay for what you create?
  • Do you have the knowledge and capacity to both create your product or service and take care of the other administrative and operational responsibilities that come with starting and running a business?

We suggest you take the following actions as you assess the viability of your hobby becoming a business that supports you and your family:

  1. Identify who your prospective customer really is. Not everyone is going to be interested in your product or service.        
  2. Determine the benefit you’ll be selling. What need or want will your product or service satisfy?  
  3. Consider how you’ll communicate your value proposition and why your product or service is better than those of your competitors.
  4. Establish what your prospective customers would be willing to pay for your product or service.
  5. Do the math. Can you be profitable at that price point? Make sure you consider overhead costs in addition to cost of goods sold.  

Once you complete your research and have the answers to those basic questions you’ll be ready to start drafting a business plan. A written plan is important because it helps identify the time, energy, and money necessary to take your hobby to another level.

If you need assistance in determining if you and your hobby are suited for small business, there are resources out there to help you. Consider taking advantage of the free mentoring services provided by our local SCORE Chapter. For more information on our mentoring and workshop programs call our office at 386-255-6889.

 

 

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12 May, 16
SCORE Chapter 87 celebrates a half-century

SCORE Chapter 87 celebrates a half-century

posted in SCORE 87 News by Jeff Dawsey

When SCORE 87 Flagler & Volusia began, Bonanza ruled the television ratings, Frank Sinatra owned the radio waves with "Strangers in the Night,” America was pushing for the return of her troops from Vietnam and college head coach Steve Spurrier was the Heisman Trophy winner. That year was 1965.

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03 May, 15
Understanding Your Market For Success

Understanding Your Market For Success

posted in SCORE 87 Post by Tom Hellmen

For any small business to succeed, achieving product/market fit is among the most important goals. But verifying that your product meets a strong market need and can stand up to competitors is not an exact science, nor does it typically happen in one grand a-ha moment. Likewise, building momentum in a market requires patience and comes with no guarantees as customers’ needs, regulatory landscapes, and competitive pressures change over time.

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10 Feb, 16
Today’s Customer Service Is the Key to Tomorrow’s Growth

Today’s Customer Service Is the Key to Tomorrow’s Growth

posted in SCORE 87 Post by Tom Hellman

Customer service is one of the most important ways a small business can distinguish itself from competitors. You have the unique opportunity to connect directly with your customers, furnish the products or services that meet their needs, help them with problems, and follow up after the sale. This generates more than just sales; it also creates relationships that will not only keep those customers coming back, but also lead to referrals and new business

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24 Sep, 15
Steps for Identifying Your Target Market

Steps for Identifying Your Target Market

posted in SCORE 87 Post by SCORE Chapter 87

If you run a business, you’ve probably heard a thing or two about target markets. A target market is a smaller group of individuals that you do business with. While individuals within your target market are not the only people who buy from you, they are your “ideal” clients or customers.


Many small businesses are scared to create an ideal customer because they fear marketing towards a small demographic will close them off to getting more business. While many business owners believe targeting specific individuals can hurt their chances of getting new customers, the opposite is actually true.


When you identify your target audience, you can create products, services and marketing materials that better fit their needs. Instead of creating generic items, you can develop super specific content that will get you noticed. Customers and clients will feel like you’re speaking directly to them and their problems, ensuring they will come back for more when they need it.
 
Identifying your target audience is not as difficult as it may sound. There is a good chance you already have the answers, you just haven't put them into a productive form yet. If you’re ready to see more business results and make more sales, here are a few steps to take in creating a customer persona.



Step 1: Know the Problem You Solve

Every company should aim to solve a problem. Whether that solution is found in a product or service, companies need to know what their item can do to make a customer’s life easier.


If you don’t already know, identify the problem that your business solves. For some, it may be obvious. Others may need to take a moment to consider how they can help.


Once you’ve identified the solution you can provide, you’re able to cast a wide net over part of your target audience. While broad, your target audience will come from individuals who have the problem that you can provide a solution to.



Step 2: Consider Your Customers

You may notice that your loyal customers are already from similar demographics. This is because, without even noticing it, your target audience can naturally gravitate to you and your business.


If you’ve already begun attracting a group of similar customers, it is easiest to accept these individuals as your target audience. Take some time to do research on who is coming into your store or requesting your services.


Consider your customers' gender and their age group. You'll also want to determine the which types of family you're serving and where they work. If you’re an online business, you’ll also want to work at the location they live. Other factors to consider include how much money they make, their education level, and their hobbies.


Step 3: Look at Your Competition

Examining what your competition is doing is a great way to get started with your target audience. While they are already your competitors, you won’t be successful if you try and enter into the exact same space they are already occupying. To get the newest business, you’ll need to differentiate somehow.


Look at every aspect of the demographics that are currently loyal to your competitors, then find a place that they may be ignoring. This may be a certain age group, income level, or gender. It may also be a certain location.



Considering what areas your competition are leaving open can be a great way to find a target audience with minimal competition.



Step 4: Create an Ideal Client Persona

Creating a profile of an ideal client does not mean that your only clients will fit that description. However, targeting just one individual can help you create an overall target audience.


To create your ideal client, you’ll want to think about who you would like to do business with if you could select anyone in the world. You’ll want to answer questions like what gender they are, what their family is like, what education level they have, how much money they make, and more.


As you answer these questions, you should be considering the demographics that go along with them. These demographics will then be used to describe your target audience. To complete your target audience, you will want to know age group, gender, family size, spending habits, income level, hobbies, education level, and more. The more specific you get, the easier it will be to target.

Step 5: Evaluate

After you’ve created your target audience, you need to determine whether or not it is a realistic group. If the target market you’ve created is not looking for your product or considering purchasing your product, then you won’t find business success.


Consider whether or not your target audience can afford your product and if they are the individual making the purchasing decision. This is especially true if your ideal customer is someone too young to make purchases for themselves, such as teenagers. You will also need to consider whether or not your target audience will be easy to reach.


If you believe that your target audience may make it more complicated to market, then you may need to consider making some changes. These changes may be to the products and services you offer, the way you market, or even to the target audience you’ve established.


Knowing your target audience can help you make better decisions when creating and selling your products. When you know exactly who you're going to sell to, you can make strategic decisions to catch their attention and make more sales.

 
Follow these five steps to create the ideal client persona that fits your needs, but remember to always evaluate and make changes. If your target audience stops responding to your messaging, it may mean that their needs have shifted. By always researching and paying attention to what problems they're looking to solve, you can always reach your target audience effectively.

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06 Feb, 17