Starting a small business

Turn Passion to Profit: Make Money from a Hobby

19th May 2020, 11:05am in Business by Eva Malpass
Hobby

Translating your passion to profit is a dream many people aspire to make a reality. From watercolour paintings of wildlife to knitted newborn clothing, finding a niche within your chosen hobby isn't the only difficult part about breaking into the crafty business world.

With the craft industry contributing £3.4 billion to the UK economy in 2019, there are an estimated 11,620 UK crafts businesses, that employ over 149,000 people. Exports from the UK crafts and handmade sector top £5 billion a year so there is definitely money to be made!

Many people have ambitions to monetise their handmade items and hobbies when starting a homemade craft business, so working hard and making your business stand out from the crowd is essential if you want to find success. However, there are so many useful selling sites like Etsy and eBay, that finding customers that will adore your lovingly crafted products isn't so difficult!

We've put together a few tips so you can learn how to turn a hobby into a profitable venture and set goals for the future. What more rewarding way could there be to make a living than to turn a hobby into a full-time or part-time vocation.

What's the craft market like?

It's a good idea, after settling into your specific niche, to research what the market is like for your hobby as a business. Are people looking for products like yours? Is there demand? What will your potential customers want from your business?

Take Dayna Isom Johnson's insights, as Etsy's resident trend spotter, she saw a 127% increase in customers searching for stained glass tools and and supplies on Etsy. Stained glass crafting is set to become one of the most trendy crafts of 2020 to sell on Etsy. Craft and handmade production is big business!

Have a look at what your competitors are doing. How does the quality of your product compare? Can you offer something they don't? Think about your competitors pricing too, is that a realistic price for your own products? If you can, sign up for their newsletters, look at what promotions they run and how they engage with their customers - so you know how to do it better!

How should I prepare my products?

It goes without saying that you'll need to have some products ready and waiting to go before opening an online store - even if just so you can take flattering photos to showcase your brilliance! But don't push yourself to your limits - customers will understand that handcrafted, bespoke items take time and care to create, so will take longer than manufactured products. When getting ready to start selling you'll need to think about a few things -

  • Can you obtain your materials quickly if you needed to?
  • If you needed to get materials faster could you afford to?
  • Have you got clear images of your products for customers to look at?
  • Have you included all relevant material info for your customers to read?

Take some time building up a base of ready-to-go products to hand when opening your online shop. Plus, if you're really finding it hard to keep up with demand, ask friends or family for a helping hand. It's always better to share the load and they might just enjoy doing it!

What website should I use to sell?

Like many craft businesses out there, they mainly begin by selling to close friends, family and neighbours. Selling to those you know is always a fantastic word-of-mouth marketing strategy as your friends and family will only have the best to say about your work (you would hope!) However, this way of selling can only get you so far, selling crafts online allows you to reach a much wider audience and increase sales massively.

While you might not be quite ready to create a bespoke website, there are plenty of eCommerce platforms that are ready to go with minimal effort. Picking the right selling platform can be a little tricky but with many overlapping you're almost guaranteed to sell whichever you choose.

  • Etsy of course if great for crafts, handmade items and bespoke, tailor fit, handcrafted clothes
  • eBay is great for pretty much everything, but craftwork like macramé and needle-point home-decor products are trending for 2020
  • Amazon on the other hand sells craft tools better than crafted products, items like clothing dye and acylic wool sell best there

Selling online has so many benefits, namely you can access a global audience that are just itching to buy products like yours! Especially in the craft market, unique items don't go unseen as the time and care it takes to create them just shows your artistic passion and customers will recognise it when coming across your brand!

How do I make my brand stand out?

Craft market

Choosing a name is a huge step, make sure you've researched it so that when people search for your business they'll remember your brand. When setting up an Etsy shop or an eBay store it's a good idea to brainstorm some potential names and even have a look at what other people selling similar items to you have chosen.

Think of your shops name as a pairing of the style and description of your items – for example, Fresh Greenery or Elegant Crystal Jewellery are clear reflections of what they intend to sell. Be careful not to mistakenly use a trademarked name, try googling yours first to make sure it's not taken!

Try and create a brand, rather than just a name - eco-concious handmade items and eco-friendly crafts are doing very well in the current market. 31% of UK businesses have reacted to the consumer demand for sustainable products and packaging by making small but significant changes to their practices. Customers are more likely to trust brands that make a significant effort to become green, so even by simply using sustainable packaging or a carbon-neutral delivery service (like DPD Local) can go a long way for brand perception.

How should I prepare my products

It goes without saying that you'll need to have some products ready and waiting to go before opening an online store. But don't push yourself to your limits - customers will understand that handcrafted, bespoke items take time and care to create, so will take longer than manufactured products. When getting ready to start selling you'll need to think about a few things -

  • Can you obtain your materials quickly if you needed to?
  • If you needed to get materials faster could you afford to?
  • Have you got clear images of your products for customers to look at?
  • Have you included all relevant material info for your customers to read?

Take some time building up a base of ready-to-go products to hand when opening your online shop. Plus, if you're really finding it hard to keep up with demand, ask friends or family for a helping hand. It's always better to share the load and they might just enjoy doing it!

How much do I charge?

Whilst it can be tricky knowing what to charge for your hobby, it would be helpful to make a clear and realistic financial plan, factor in raw materials cost, any fees from selling platforms, packaging, postage and of course your time in creating the products before determining what the minimum you can charge is to turn a profit.

As we talked about earlier, having a look at what your competitors are charging for similar items is a really good marker of what you can expect customers to be willing to pay. If you can't realistically meet that price tag then you may need to look at if you can source the raw materials cheaper, or even go back to the drawing board in terms of what products are viable options for your handmade craft business.

One way you can can help keep costs low is by using a shipping company that offers excellent services for less. We at Interparcel are here to help craft businesses finding their feet - our low cost but high-quality shipping services have helped hundreds of companies who use our Shipping Manager to handle orders, address labels, and shipping options in one place. Getting a new business started can be difficult and time-consuming if you're the sole worker churning our handcrafted products - our shipping integrations were created to save people like you time so give it a try!

Keep in mind that if you plan on making money from your craft business you'll need to have a look at your tax obligations, if your combined income from all sources is below £11,000 you won't need to pay tax - but it's worth reading up on!

How can I find customers for my crafts?

Naming your small business

Marketing is key for all new business. You need to know your brand and have a clear idea on how to present it. Take Ikea as a great example, their website conveys the sleek and clean style of their products. Their clever marketing strategy is to place their items into 'showroom' images both online and in physical stores, allowing customers to see and imagine their products in their own homes.

eCommerce websites like Etsy and eBay will allow you to access an existing customer base to sell crafts online to. These customers are already searching for items like yours and these websites will place you alongside other craft businesses like yours, so make sure you've got your branding and products ready to wow your customers!

Never understimate the power of word of mouth, make sure to wow all of your customers with fantastic products, great service, maybe even unique packaging. Happy customers will talk about your brand and products to friends, family and maybe even on review sites - this can even result in a surge in sales

If you don't already, then set up an Instagram or a Twitter account for your hobby business, its a great way to showcase your products and get people talking about your brand. There's lots of different eCommerce marketing strategies you can try, it's best to have a mix and match approach to them.

How do I manage my time?

Managing time

Being realistic, you'll probably be working alongside create a business out of your hobby. It's always a safe bet to not quit your day job before your business has really found its feet. This means you'll have to manage your time well and efficiently so you don't overwork yourself. Factor in some early mornings and some later nights, but make sure it's not every morning and night.

Treat your handmade business like a job in the short term and it may just become your actual career! Read up about the industry and keep on top of your marketing. It's all trial and error and although looking at competitors' strategies can make you feel as if you're not growing as fast as you would like, it's all about putting your best foot forward! There's no reason not to have a go - so why not, turn your part-time hobby into a full-time dream job!

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