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Many Indian women dream of setting up a home based business based on a hobby; here’s what you need to turn your hobby into a business.
By Vandana Chatterjee
Being able to convert a personal skill or talent into work is perhaps the happiest state of being. Many Indian women dream of being paid for doing what they love! Yet, even though the business may be based on a unique skill, it will still be a business, and all the due diligence that would go into starting any other enterprise, has to go into starting a hobby based business as well. Is there a large enough market for my product/service? What is the unique slot I can occupy?
How much money will be required to start? What sort of equipment will I need? How many hours per day would I need to dedicate? Who will supply me raw materials? At what cost? How do I market my product/service? These are just some of the questions you would need to find answers to, when turning your hobby into a business.
A recent highly successful movie Band Bajaa Baraat highlights the typical issues faced by entrepreneurs converting a personal passion into a business, and what makes them fail or succeed. In the movie, a young woman passionate about event management, ties up with a friend and starts a business. Their flexibility, nimble-footedness and ability to scale up both their operations and personal capabilities takes them from zero to being an established name in the market. The same team then falls out due to personal reasons, and is unable to separate their personal issues from the professional. They lose clients, start undercutting each other and eventually lose their credibility in the market. While the movie ends on a happy note, let us look at the reasons for the failure of their venture, Shaadi Mubarak:
– The inability to separate personal issues (be they ego or emotions) from the professional
– The inability to replicate the Operational Efficiencies achieved by the team once the partnership broke up
– Problems in financial planning
– Inability to take vendors into confidence
– Cash flow issues
All these would hold true as reasons for the failure of any hobby based enterprise. For example, the inability of an artist or writer to separate his/her ego or creative urge from the execution of a commission to the client’s satisfaction would result in loss of business. As would each of the other points mentioned above.
Ruchie Mittal, a doctor by training, now runs Muscovado Cakes in Delhi, making fine specialty chocolates and made to order cakes. Ruchie has turned her passion for baking into a successful business. Discussing her experiences in setting up this business, Ruchie says, “Converting a hobby into a business needs a lot of thought to go into it before actually taking the plunge. When hobbies accidentally turn into businesses, the unthought-of complications of the ‘business’ of running a business can completely demoralize the entrepreneur.”
For example, according to Ruchie, additional training may be required to be able to commercialise your skills sets. It is one thing to bake fantastic cakes, one at a time, but one may need special training to bake on a large scale. One has to source good vendors who can supply quality raw materials at the right price. It may become difficult to execute orders once they start flowing in, if sufficient planning has not been done in advance.
Hiring for Small Businesses
Hobbies which depend on a single person’s unique talent (such as writing or painting) generally do not need support staff or additional planning. Other hobbies such as baking or education related hobbies may need skill sets that you may not have such as accountants, labour, or operations experts. For example, a person with a passion for pre-school learning, wanting to set up a pre-school establishment for toddlers will need caregivers, an accountant cum administrator, housekeeping staff at the minimum. Decide what parts of the business you can handle, and which parts you need to get staff to handle.
You need to think in advance about how much time you can invest in your work and how to handle your other personal commitments before you start. Equipment requirements also vary with the scale of operations. Do think about auxillary issues such as packaging material, storage of finished goods, promotional materials, advertising and sales promotion before you start the business. Knowing your customers and finding the best way of reaching them, both to promote as well as to deliver your product is critical. The more customers you would wish to reach, the more important your supply chain becomes.
The inability to scale up operations in situations of growing demand and inversely, of scaling down operations in times of recession will result in severe financial repercussion, loss of credibility in the market and a possible closure of business. Creative products in India, as elsewhere, are particularly hard to predict, since some may appeal to a very small niche.
Deeply personal skills such as writing and painting when converted into a business can result in a lot of frustration, as commissions in these areas come with a tight brief. The entire creative process needs to be reigned in to meet client requirements. Subjects are dictated by clients, as are formats and word limits. It is often more than frustrating to the artistic temperament to curb their natural instincts and work to a market dictated plan.
Perhaps most importantly, give yourself TIME. A hobby turned business will take a certain amount of time to break even and start generating profits. Set definite goals and work to a plan. At each stage, measure your results and revise your plans. This way, you can correct your course on time and reach your goals.
Give yourself a chance to succeed! Think, plan, execute and evaluate at each stage. Your hobby can definitely be monetized.
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