Recently, a reader wrote to me asking the following:
I would love to know how many of your readers supplement their incomes with side work, especially things like computer support, tutoring or even substitute teaching: intermittent work, where the “product” is their time, and where they have to go out and find customers. Of course, I’d also like to know how it worked out for them.
I have experience with two distinct side businesses, a small computer consulting business and blogging. Here are some of the general observations on these side businesses that might be useful to people considering starting their own side business.
In both of my businesses, I got started on a shoestring – my primary investment was time. I started my computer consulting business by hanging up flyers in the post office and on community bulletin boards. I started blogging using a free blogging service. In both cases, the expenditures were tiny – if I had the capital to invest, I wouldn’t be so interested in a side business like this.
Building The Business
The start of both businesses was very dry. Let’s get that straight right off the bat: if you start out with minimal advertising and no network of people to tap, as I did, the business will start with a very dry period. You won’t have immediate success, period. For the first three months of my consulting business, I advised one couple on what laptop to buy and got $20. For the first two months of my blog, I did not make a single dime, even though I was posting multiple times a day.
It picked up when I started to network. In both cases, though, as soon as I started talking to people in the community and introducing myself, my business, and what I have to offer to them. I started getting involved in my local community to promote my own business, going to a lot of community events, meeting people, shaking hands, and giving out my business card to anyone who seemed remotely interested. For The Simple Dollar, I found people online who were writing on similar topics, sent emails, posted comments, and hung out on messageboards (writing a lot, especially at first, helped too).
Success feeds on success. In both cases, once I got past the initial “hump” of slowness and continually produced good work, the businesses seemed to almost take on a life of their own. The popularity took off for both and soon I was getting business and recognition from people I didn’t know at all and had never made any effort to contact in any way. The key? Customer service. Treat everyone’s input like it’s golden, implement what makes sense, and be sure to let people know when you follow their input. If something is wrong, fix it and don’t sweat the charges or time, because you will be paid back for the effort in the long run.
My rule of thumb is that I save $0.50 of every dollar I bring in on these businesses for taxes. That seems incredible at first glance, but it’s true: taxes will eat you alive. I keep this money in a high-interest account and then do my taxes using TurboTax at the end of the year. I save every receipt and full documentation on everything associated with the businesses and I don’t try to play any games with questionable deductions because it’s worth the extra taxes I might pay to avoid a detailed audit.
In short, if you start a side business, do it because you love it and because you have enough skill to make quality output. If you can handle those two things, the business will come. Just be patient.
Do any readers have additional thoughts or experience that they’d like to share?