Downsizing, pay cuts, rising costs, inflation. These among other similar terminologies reflect the prevailing economic situation in today’s labour market. Ever since the pandemic hit, sole dependence on regular 9–5 jobs has proven to be unsustainable.
Many have turned to investing in side businesses alongside their regular jobs to supplement their income and also develop a strong fallback plan.
Current statistics show that more and more employees at regular jobs are taking up side businesses which implies that if you are yet to do so, you are among the depleting category of people yet to expand their income pool.
This article contains actionable tips that will get you set to invest in a viable side business today.
1. Make a Side Business Choice Using Convenience and Interest Metrics
The best choice of side business is always one that you have an interest in. If you do a personal assessment, you’d likely notice an area of interest or service that you naturally love which you can monetize. That’s a pointer to a side business you can start.
Convenience is another paramount metric in your choice of a side business. You would not like to lose your regular job in your quest to build a safe nest for yourself. You have to choose a side business which you can couple conveniently with your 9–5.
A large range of side business choices exist. You can check out one that fits your interest and convenience metrics here.
2. Assess Profitability of Your Side Business Idea
It’s a general rule. No one would love to add to the burden of their regular jobs by making investments in a side business that is not profitable. We believe you are not an exception to this rule!
To assess the profitability of your side business choice, you should research what the market of that business is like as well as major indexes like ease of entry, capital requirements and ROI.
SWOT Analysis for Side Business Idea
It is also important that you do a SWOT analysis on the side business. SWOT stands for:
- Strengths: The positive and profitable aspects of the side business
- Weaknesses: The risks involved in the side business
- Opportunities: The less explored aspects of the business which can be profitable if ventured into
- Threats: Competitive alternatives to the side business and other external factors that may affect it like government policy
For instance, if a newbie intends to start a volatile side business like stock trading, it is necessary that such a person does research regarding investment for beginners and does a SWOT analysis of the stock market.
3. Set SMART Goals for Your Side Business
The need to set goals for your side business cannot be overemphasized. You have a better awareness of your progress when you set goals for your business. Also, goal-setting prevents the venture from being directionless.
Setting SMART Goals for Your Side Business
The goals you set for your business should be SMART.
SMART stands for
- Specific: The goals must be clearly stated, specific and comprehensive
- Measurable: The set goals must be capable of being measured
- Achievable: While setting the goals, you have to be objective and realistic
- Relevant: The set goals must contribute to the growth of the side business
- Time-bound: The goals should be set with a time limit for achieving them
4. Optimize Your Time to Accommodate Your Side Business
You most likely spend an average of 8 hours at your regular job. That is a third of your day gone already. However, to sustain and grow your side business for profitability, you have to invest quality time into it. There is a need for you to maximally optimize the use of your time.
The following methods may help you optimize your time use for the benefit of your side business:
- Use weekends solely for your side business.
- Reduce your participation in non-productive activities.
- Use breaks and spare time during your regular job to follow up on the progress of your side business.
- Use filler time (like time spent on the bus commuting to work) for your side business.
- Delegate tasks to create more time.
While seeking to optimize your time use, ensure you divide your time fairly between your regular job and your side business so that neither ends up lacking attention.
5. Be Ready to Make Sacrifices for Your Side Business
Coupling a side business with a regular job will require a lot of sacrifices. Starting from capital investment, a lot of sacrifices have to be made when setting up a side business. You’d most likely have to use money that would otherwise go to other short-term expenditures for the side business.
You’d also need to sacrifice the time you use for other activities to focus on the side business. Most importantly, you’d have to cut down on your leisure time to cater for your side business.
Side businesses do draw sacrifices.
6. Create a Network of People in Your Side Business
In the words of a popular axiom, ‘To go far, you walk alone. To go farther, you walk together.’ Solitude is a risk to growing a side business.
You should develop relationships with other people engaged in the same (or similar) side business as this would help keep you on track and also grant you access to useful information.
Having a network of people in the same side business could also be useful in the aspect of pooling together capital and other resources for bigger ventures.
Lastly, your network can also be a source of motivation as to what you can attain with/in your side business.
7. Think Long Term
While setting up your side business, you must be able to think long-term. This means that the plans you make for the business should be such that it will enable it to grow and remain profitable for a long period.
Where a side business is developed with long-term plans, it can serve as a good fallback plan for the person investing. You can easily transition from your regular job to working the side business full time.
Also, a business that is built for long-term purposes will require better inputs and management. This will motivate you to ensure the outputs of your side business (whether products or services) are of good quality.
The final tip is the best time for starting a side business. Should it be when the company’s board suddenly decides the recurrent remuneration cost is increasing their overhead? And they finally decide to downsize?
That’s your answer. The most appropriate time to start your side business is NOW!
You can start doing an evaluation of side businesses you can invest in right away. You will get the needed resources along the way. Only a waiter will wait for more tips!