Passion – one of the most misused, overused and abused words in the English language. In January of 2014, it and all its forms were on Lake Superior State University's "List of Words To Be Banished From the Queen's English for Mis-Use, Over-Use and General Uselessness".
People love to say the word but rarely understand what it really means. Saying "I'm passionate about . . ." is not enough. Passion is about living, breathing – being – something without which you do not otherwise exist. So, do you have a passion for something? If you do, we at GET.com recommend that you keep reading on to find out how you could possibly turn your passion into profit.
1. Identifying The Profit Point Of Compulsion
The Compulsion. Identifying your passion is not always as easy as you might think. Would-be entrepreneurs mistake interests, hobbies, pleasurable experiences or clever ideas as their calling in life only to find themselves resisting the hard work and daunting investment that follow.
Possessing a skill or talent is not enough. Your passion must be the one thing that always finds you or draws you back, no matter the mishaps, regardless of naysayers. When you don't know what else to do, your passion is what compels action.
The Profit Point. To turn it into a business, you must determine a profit point of reference. Often, true passion is not about figuring out what you want from the world. Instead, you must determine what you have that the world wants and is willing to pay for.
Industries and markets may be full of competitors, but each of the survivors has some aspect of service or a product they offer to which they've added their own distinct quality. Find a facet within your own talents that will allow you to enter the marketplace yet also set you apart and define exactly what you have that everyone should want.
2. Finding And Confirming Your Market
Finding. According to the Pareto Principle, 80 percent of your business will come from 20 percent of your customer base. In addition, no marketing, coupon or advertisement carries the weight of a word-of-mouth reference. As a budding entrepreneur, you need to find that vital 20 percent who will spread the word.
Don't confuse customers with family, friends or peers. People who want to make a living doing the same thing you want to do rarely become customers. Besides, family and friends are often reluctant to pay. The customers you are looking for know they can't do what you're offering and are willing to pay someone who can.
Confirming. Once you think you've found them, approach them, and test their honest response to the goods or services you're offering. Free samples may offer an introduction, but the true test is whether customers return for more, asking about price.
Your test market may be enthusiastic and encouraging, but unless they become customers who actually make repeated purchases or refer other paying customers, you either need to keep searching for that 20 percent or rethink what you're offering.
3. Assessing Your Financial Feasibility
Expenses. Some businesses require minimal capital to start while others demand considerable investment in a furnished, furbished, inventory-rich brick-and-mortar establishment.
You'll have to calculate a range of budgets for start-up and recurring expenses; check out our article on how much money you'll need to start your small business idea. Then, compare those figures with your own financial resources. You'll need sufficient funds not only to start your business, but also to pay recurring expenses until you cross into profitability.
Feasibility. Simply put, do you have access to the amounts of money necessary to set up shop? If not, you'll have to identify accessible money resources:
- Financial demands often drive investors to tap on retirement assets, max out credit cards or liquidate home equity.
- Online crowd-sourcing has potential for those willing to promote and pursue their goals, as do small-business loans or even micro-business loans.
- You may be eligible for special loan programs or other assistance.
- If you're thinking of appealing to investors, recognize that most individuals willing to provide funds expect entrepreneurs to already be heavily vested in their venture. They'll expect a fully executed business plan, evidence of a proven track record and most likely some healthy equity in exchange before parting with cash.
4. Establishing Support Systems And Doing What You Love for Money
Responsibility. If your current salary is essential to your well-being or you shoulder heavy family responsibilities, you may find yourself torn, serving multiple masters.
Evaluate whether you can balance a new financial undertaking with your current responsibilities. Identify specific, objective accomplishments that would signal the milestone of turning in your employee badge to become your own boss.
Partnerships and Employees. Consider whether you'll be able to successfully perform all the duties necessary to making your business a success. If you're creating a product, will you be able to oversee manufacturing, negotiate with suppliers, and promote and sell your goods?
If you want to offer a service, can you manage the logistics and market yourself effectively? How many people do you need to ensure success for your product or service from cradle to grave?
Mentors and Emotional Investment. Doing something for enjoyment carries few worries. However, when you enter your passion into a financial equation where you're solving for profitability, focus shifts from intrinsic reward or "me time" to the gravity of monetary risk.
Not every customer may prove pleasant or easily satisfied, and competitors may criticize or adopt stressful strike tactics. Deadlines can destroy perfection and erode confidence levels. Seek out an encouraging mentor who will provide sound business advice.
5. Business Plan And Beyond
With the will, drive, focus and means of moving forward, craft your passion into a written business plan. Make it a reality, and become it. Don't say you're passionate about traveling. Be the best travel writer or consultant that you can be, and find your 20 percent who will pay you what you're worth.
Turning passion into profit can be a long and difficult path, but if you have to spend the next 5, 25 or more years earning a living, why shouldn't you invest them in turning passion into profit?