Turning a Hobby in to an Income

If there is one thing that most people would like to do, it's increase their income.  The problem is:  How? 

One way to do it is to turn a crafting hobby in to an income.  If you have something that you enjoy doing, why not try to make a little money out of it?  It's what I did with my jewelry business.  While my jewelry business is pretty seasonal (by choice), the money I make doing Christmas shows sure comes in handy!

So where do you start?

1.  Honestly evaluate your skills and work on improving them, if need be:  I dabbled with cake decorating for a while and even sold a few cakes.  However, I couldn't make a decent buttercream icing rose to save my life.  Make an entire Noah's Ark cake and animals out of fondant?  No problem! A cake that looked like a bed with girls made out of cookies and a solid chocolate headboard (it was for a slumber party).  Easy Peasy!  That rose was a whole other issue.  If I ever decide to get back in to decorating cakes, the rose is the first thing I have to master!  Check out your local craft store (like AC Moore or Michaels) for inexpensive classes.

2.  Make sure that you know and abide by your local laws on starting a business.  Your state and/or town likely requires you to have a business license if you are going to sell anything.  Want to get in to catering or a food-related business?  You may need to have a Health Inspector check out your kitchen!  While plenty of people start up a little side-business and never go through the proper channels and don't get licensed or don't charge sales tax and never get caught, those generally aren't odds that I am willing to take.  It costs me nothing to have a sales tax license and the cost (in fines) that I would incur if I were to get caught operating without a license are far greater!

3.  Evaluate the market and see what craft is underserved.  Anyone who has been to a craft show in the past few years knows that there are certain things that become "hot" and all of a sudden it seems as if everyone is doing it.  Right now it is jewelry.  A few years ago it was One-Stroke Painting.  I think all the people who were doing One-Stroke went in to jewelry because I hardly see it any longer.  And you know what?  I'm always looking for someone who does One-Stroke on wine glasses because they make great gifts!  Right now I'm searching for someone who makes a prettier cash envelope system than my one by Dave Ramsay.  Just think of the money to be made off of people like me who want to look good while they are being frugal!

4.  If you are going to start selling in a very competitive market, make sure that what you do is unique.  Using jewelry as an example, there are tons of jewelry-makers out there who simply string beads on wire and headpins.  Many of them make money, but even more find themselves competing against very similar jewelry.  It's the ones who offer something different:  hand wire-wrapped jewelry, handmade polymer clay beads, handmade lampwork, etc that do the most business.  

5.  Look for other avenues of sales aside from craft shows.  The craft show circuit can be very demoralizing.  Lets just say that not all people are as polite as they should be when viewing the hard work of others.  Check out your local independently owned stores, consignment shops and even beauty salons and see if you can set up a display there!  I can't tell you how many things I have bought because I sat there staring at it for 45 minutes while I was having my hair done!

6.  Think about teaching, not selling:  Perhaps you just aren't good at sales?  I know many women who never sell a thing, but make good money teaching classes.  They teach knitting at the local yarn shop, cake decorating at the YMCA, etc.  I even know a few fellow "frugal bloggers" who make money teaching classes on how to use coupons!

7.  Lastly - treat it like a business from Day One.  That means keeping good records.  If you start recording all expenses and income from the day you start, rather than trying to figure it all out on April 14th, you will save much more than just your sanity.  I use a paid-for copy of QuickBooks for my jewelry business, but they also have a Free Online version of Quickbooks  that you can use.

Starting a business is hard and will probably take some time.  But if you can find a way to make money doing something you love, the rewards can be tremendous!