So you’ve found something that you’re passionate about and good at. You’ve decided to take a stab at launching your side business and setting it up to operate as a legitimate business.
Whether you are freelancing your skills, selling products online or marketing your services and negotiating contracts, you are running a business in a sense. What’s scary, is that most new businesses and start-ups fail within the first year.
When you are interested in making extra money and building wealth as a result, failure can be a disheartening thought.
However, setting your side hustle up for success and creating the systems and processes needed in order to make it thrive can greatly reduce the risk of failure. Here are four ways to set your side business up for success.
1. Organize your Finances
Managing your personal finances can seem like quite a bit of work so you need to be up for the challenge of managing your business finances as well on the side. It’s important to keep track of all your start-up expenses and store receipts either in a file folder, digitally, or both. Keeping track of your expenses throughout the year can be helpful when you are doing taxes so you’ll know exactly how much to deduct.
You should also track how much income you have coming in and deduct expenses each month to measure your net profit. Don’t forget to open a separate business checking account and review your bank statements each month and invoices.
You can use a spreadsheet to record all this information in one place and update it once a week. You may even want to work with an accountant if you plan on paying quarterly taxes at least for the first year or so since it will help simplify the process for you so you can get used to managing business finances.
2. Organize your Time
When running a business, especially on the side, it’s crucial that you stay productive and manage your time properly. Find out when the best time of the day is to work on your side business and maximize your productivity during that time.
At the end of each week, plan out what your goals are for the following week and which tasks you will tackle each day. I stick with a goal of trying to achieve two to three tasks per day and I’m satisfied if I reach my goal. Anything else I end up achieving is a bonus for the day.
You can schedule out tasks for yourself in task manager tools like Asana which will notify you if the due date for something is overdue or if it is coming up. You can also upload files, brainstorm ideas using Asana and come back to them later. Organizing your time will help you get a lot more done in the time allotted and feel more accomplished at the end of each day as a result.
3. Use Effective Accounting Tools
Sending out invoices will be your bread and butter to help ensure that you receive payment for the work your completed. When running a professional side business, you’ll need to present yourself as a professional. You can use PayPal invoices to request payment from clients or you can take it a step further and use a professional invoice system.
There’s also Freshbooks, which is a paid service with an initial 30-day free trial. Fresh books offers a lot of great tools all geared to help you manage invoicing and cash flow. Freshbooks also cuts any PayPal fees to $.50 per invoice which can save a significant amount of money each year.
4. Hire Help
Hiring help sounds like an expensive part of operating a business, but when you run small business it doesn’t have to be. If you choose to outsource to give yourself more time to handle other areas of the business, you have the right to choose to work with whomever you wish who can meet your budget constraints.
You may need a weekly or monthly writer for your website’s blog or a virtual assistant to help take over administrative tasks each month. You can hire someone on a very part-time basis for a small fee and reap the benefits by growing your business quicker.
Launching a side business can be a huge ordeal. It’s important to set up the right systems and processes to help make it a success and increase your profit right off the bat.
Have you started doing any work on the side? How do you manage it all to ensure success?