If you’ve been earning some extra cash via a side hustle and things are starting to take off, you might be tempted to turn your lucrative hobby into a fully-fledged business. A side hustle gives you the chance to test the waters when it comes to acquiring customers and being your own boss, so it can certainly give you an idea of what it would be like to run your own startup.
Before you get started, however, it’s important to identify how your venture will change as it transitions from a side hustle into a business. To get started, take a look at these four things you’ll need to do to turn your hobby into a profitable business:
1. Register a Company
When running a side hustle, most people operate as self-employed freelancers. Although you still need to submit tax returns as a sole proprietor, your side hustle income is taxed in the same way as any other income you earn throughout the year and your business and personal assets are merged.
If you want to turn your side hustle into a business, however, it can make more sense to register a company instead. This separates your personal and business assets, which affords you more financial protection. Furthermore, establishing a separate corporate entity can also protect your personal liability.
2. Hire an Accountant
As a business owner, there are numerous duties and obligations you need to fulfil. Financial reporting is one of the most important, so don’t overlook this aspect of managing your venture. Fortunately, cost-effective small business tax preparation services from Brown Smith Wallace LLP make it easy to access the help you need. When you outsource your needs to experienced accountants, you can reduce your own running costs while ensuring that your business meets its legal and financial obligations. What’s more – an experienced accountant can also help you to reduce your tax liability and save your business money.
3. Devise a Marketing Strategy
If you’ve been working as a freelancer while earning money via a side hustle, you might have found new clients on dedicated platforms and websites. As a small business, however, you’ll need to implement your own branding and marketing strategies to acquire customers and clients. Whether you decide to do this in-house or work with B2B marketing firms, it’s important to ensure your marketing campaigns increase brand awareness within your target audience, optimize your conversion rate and deliver a high return on your investment.
4. Re-think Your Schedule
A side hustle gives you a viable way to make money while you’re working your regular job but, as a new business owner, you may need to dedicate more time to your venture. This might mean reducing your hours at work or giving up your job altogether. While launching your own business can certainly be risky in this respect, it’s also a fun and exciting way to earn a living and do something you love.
Take Your Side Hustle to the Next Level
A successful side hustle can give you the confidence and motivation to launch your own business but do prepare yourself for the different challenges you’ll face as a business owner. By doing so, you can ensure that you’re ready to take your side hustle to the next level and launch your very own business.