How To Start A Profitable Side Hustle

Having a profitable side hustle that can provide additional income, and be easy to maintain, both in cost and time is the dream of everyone with the entrepreneurial spirit. This can be a challenging balance to reach. But the lure of financial independence, as well as the ability to control your own schedule, are strong motivators. When it comes to building a side hustle, there is a big difference between a hobby and a genuinely successful home-based business.

How do you build a profitable side hustle? Building a successful home-based business takes consistent, persistent effort, and some marketing. But it can be done on a budget, if you know how to use the right tools.

Many people try to turn a hobby into a home-based business, and many achieve some level of success. But about 20% end in failure their first year because they don’t know how to apply some very basic business building principles. We’ll address some of those principles below so that you don’t join the number of failed small business owners.


Most entrepreneurs decide to build a side hustle based on a hobby or skill they already possess. This can be a great approach, especially if you have a real passion for a your given industry and believe you can stick with it for the long term.


Do you have to choose between selling a physical product and a digital one? Not necessarily. Some industries can marry both in a very successful and profitable way. But there certainly are some pros and cons to each. A lot of entrepreneurs are crafts-people who would love nothing more than to earn a stable income from sharing their passion with the world. There are many considerations when trying to turn art into cash, though. I know, first hand, the challenges. And I’ve seen artists and crafts-people make some very serious mistakes as they attempt to turn their hobby into a business. I’ll identify some of those errors in a minute here. But first, let’s consider some possible products and services that might be turned into a successful side hustle –


Artwork, jewelry, crafts, food items, clothing, electronics, paper products, toys, cosmetics & personal care items, etc.

A consideration here, if choosing to sell physical products, would be whether you intend to make the items yourself, or if you will market someone else’s products? These choices significantly impact the way you will conduct business, as well as your potential profitability.

Another TYPE of Physical Product might be SERVICES: I include this category under Physical Products because you have to be physically present in order to sell the “product.” Some of these services might be: Massage therapy, in-person fitness training or coaching, beauty services (such as hair styling, nail services, etc.), catering or other chef services, psychic readings or other spiritual coaching services, author editing services, website design, etc,


If you are a crafts-person, the joy and gratification you experience when someone purchases something you have handmade can be extremely rewarding. And this satisfaction can be enough to push people to market their handcrafted art and other products for years. If you choose to sell products manufactured by someone else, the incentive and satisfaction might be derived from generating enough sales to off-set your 9-to-5 income. Eventually, you might even be able to leave your JOB and become truly self-employed.


Unfortunately, many times talented artists do not actually show a profit as they attempt to sell their wares. They might THINK they are profitable…just because they sell some of their items. But when push comes to shove and the dollars are tallied, their side hustle business is actually operating in the red.

Many crafts-people don’t adequately price either their time or skill. And this results in their products being priced below market value. I’ll write another blog post about that in the future.

Another con of selling physical products can be delivery. Either having to package and ship a product to the end consumer, or arranging for in-person pick-up or delivery. This isn’t such an issue if selling other people’s manufactured products where they will drop-ship the product directly to the customer for you. I’ll talk more about affiliate marketing or acting as a middle-man to drive traffic to other businesses as a possible side hustle option in another post.


A HUGE con of selling physical products or services can be overhead. Storefront or other physical manufacturing space is probably the single largest obstacle for most entrepreneurs wanting to start this type of business. The obvious way to avoid this problem is to start a side hustle you can begin from your garage, spare bedroom, or dining room space. This allows you to grow your business gradually. But if you intend to move into a larger, commercial space the expenses really add up quick. And if you need to hire employees…well, that’s a whole other bundle of problems.


Such as eBooks, documents, brochures, webinars, etc.


Downloadable eBooks and documents are available 24/7/365 to anyone with a connection to the internet. So, this type of product can literally make you money on a recurring basis, without continual attention from you.


The biggest con, or obstacle, to selling digital products is writing and publishing them. There is a pretty steep learning curve required to properly write and format sales-worthy content, and include graphics or other professional-quality images, such as a cover, for your publication. So, you need to know about, and have access to, the best software programs, and know how to use them in order to create these products. You also need a platform and delivery system for people to purchase and download your publications. And, of course, you need to have a website or other online destination where people can go to learn about your products. This might just be a social media page. But you need to publicize your materials so that people know where and how to find your products. And then, of course, you have to arrange for a payment system.


A small business needs the proper city, state, and possibly federal licensing for tax purposes and in order to legally operate within your locality. So, you will need to register with your city for a business permit and your state for a business license. How you choose to structure your business is a personal decision. You will want to do some research before you make that choice.

Will you be a sole-proprietor or “solopreneur?” Will you choose to form an LLC (Limited Liability Corporation) which offers you some personal protections not available to the independent business owner, or will you choose an S Corp? You may want to consult a professional business adviser before making this decision. Most small business owners starting a side hustle opt for the sole-proprietor or LLC options.


Just because you make an awesome product, or offer a great service, doesn’t mean people will automatically know about it and begin beating your door down as soon as you hang out your shingle, so-to-speak. People need to KNOW you exist and have something on offer to sell. How will you promote your side hustle so that you can begin earning income? You will need a website and probably at least one social networking profile, as well. But guess what? I hate to disappoint you, but the same is true about publishing a website as is true with starting a brick-and-mortar business. You have to advertise. Otherwise, people won’t know you exist. This is probably the single biggest challenge for most small business owners. Figuring out how to promote their product or service in a way that drives traffic to their offering. This subject deserves its own blog post, so I will write more on this at a later date.


Once you start your side hustle you’ll have to think about how you want people to pay you. If your business is an in-person endeavor, then you could simply choose to take cash and/or personal checks. You’ll have to open a business bank account, of course, so that you can make deposits and track your income for tax and other bookkeeping purposes.

But you might also want to consider taking other digital forms of payment. Back in the old days, before the internet, you had to apply for a merchant account. That was a real pain in the butt. But these days, offering multiple payment options has become the norm. Many small business owners try to make it as convenient as possible for customers to submit payment for their purchases. Some possible digital payment options you might think about are PayPal, Venmo, Stripe, Google Wallet, and others. Almost anyone can make these payment options available to their customers. All it takes is a willingness to share a small percentage of your profits with the payment service provider when a sale is made.


Starting a side hustle can be fun and profitable. But there are some risks and serious considerations you need to plan for when thinking about how to set up your own home-based business. If you aren’t ready to commit to treating your new endeavor like a real business, then it might be best to view it as a hobby or something that you just enjoy doing in your free time. A side hustle requires time, resources, and dedication in order to make sure it really thrives for the long term.

If you enjoyed this post, you’ll probably like THIS ONE about my pyrography projects in progress.

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