Forget “the great resignation”. It appears that more people have decided that getting a side hustle is a smart way to improve their earning capacity in 2022.
ING research has found that nearly half of Aussies (48%) either have started, or plan to start, a small business on the side, whether it’s selling stuff online (37%), investing (30%), freelance writing (13%) or creating art (13%).
Business adviser Craig West, the founder and CEO of Succession Plus, says a side hustle often starts because the business owner has a passion or skill set that is in demand or is perhaps a hobby or interest.
“Most people go into business because they are good at something and enjoy it. More recently, because of lockdowns, people have been looking for both something to do and some extra income.
The continued growth of the gig economy also drives this kind of side hustle.”
An Actuaries Institute research paper recently found that the gig economy grew ninefold between 2015 and 2019 to $6.3 billion, with a gain of 32% in 2019. At the same time, the advances in technology – such as cloud accounting, mobile payments and online stores – have made it much easier to establish a side hustle.
Best of both worlds
With one in three small businesses expected to fail in the first year of operation, a side hustle is a great way to ease into self-employment. West describes it as a “best of both worlds” option.
“Many people are inherently risk averse, and therefore stopping work completely is far too risky. So, starting a business as a side hustle after hours without giving up full-time employment is a safe option.”
There is also the $64,000 question: when do you know that the side hustle will be
viable? West says once the earnings from the side hustle replace or get close to your current income, this is an excellent indicator a business concept has legs.
“But often it is not all about income – maybe you can earn 75% of the income in 50% of the time – or maybe it is about flexible work time and location, and spending more time with kids, especially with [more people] home-schooling,” he said.
Do your research
Before focusing on a side hustle full-time, West advises budding business owners to undertake research, including preparing a simple business plan.
As part of the planning, they should scope the market for the product or service they plan to sell, and discover what the competitors are doing, the pricing expectations for the product or service and the best ways to market the …….