BizLife Video | 1.2A   Now To The Nitty Gritty

Money – it’s great stuff.

With money you can go to the cinema, grab a snack, download some new tunes, buy new headphones through which to listen to your new tunes, pick up some new clothes, or a car, a house, an education…. an airplane….. a trip to climb Mount Everest….even new skis to descend Mount Everest…wait. Not the skis – that’s a terrible idea.

The point is, money is deadly.  Very few people legitimately don’t like money and we’ve been using money for a very long time, but as you know, there was a time before money.

Back in the old days, if you wanted something that someone else had, you either had to give them something that you had – your neighbour has a goat, you’ve got some pottery, you do a deal; or you had to trade something that you could do – your neighbour had a goat, you could thatch their roof.

Those days are long gone; nowadays we exclusively use cash money and that’s just that.

Well, no, not really.  

Having a job is, at its core, still a form of barter – I’ll work in your shop and serve coffee to your customers in exchange for something, in this case money…and occasionally a free cup of coffee to keep me going.  Or, I’ll balance your books in exchange for part of that money I’m keeping an eye on.

But not everyone works for someone else, and you don’t have to wait until you have enough money to rent space for a coffee shop.

“Find a way to make money doing what you love and you’ll never work a day in your life,” goes the old saying, and for some people that’s exactly what they do.  Sometimes a hobby can easily develop into a business or career; let’s look at how that might happen.

Michael fancies painting and he’s been doing it for a while now.  With practice he got pretty good at it, so he started creating cards to give people for Christmas, birthdays, Easter, whatever.  It’s something he enjoys doing and people like his work, but painting has started to be expensive – supplies like paint, brushes, cards, all cost a fair bit – so now, he has to choose between painting less – which doesn’t work because he really enjoys it – or he needs to find a way to finance his art.

A family friend suggests one day that he should consider a career in art, which is something that Michael hadn’t considered before; he just likes painting and always gave away his work. so he wouldn’t even know how to get started.

Luckily, Michael’s grown up in the information age, and a quick search online leads him to one of sites where people sell their art, crafts, artsy crafts, crafty arts…..whatever they come up with.  Not having sold anything before he doesn’t know what to charge, so he looks at the market – what other people are successfully selling similar items for – and sets up his own shop.

The site sets him up with a place to show his art, as well as a way to accept payments, and soon he’s sold some of his hand painted card. His sales gives him enough cash to buy more supplies, and he even has a little leftover when he’s finished shopping, to put in his own pocket. It makes him feel great that people like his work enough to pay for it.  

Maybe someday he’ll be able to sell enough to make a career out of his art, or maybe he’ll  be happy to do just enough to finance a hobby that he finds very satisfying, but either way, he’s opened a new door into opportunities for himself and had fun doing it to boot!

Anna doesn’t paint, but she does love dogs.  She’s always had dogs and is really good with them and knows how to keep them under control, so when her neighbours can’t bring along their terrier, Jack, on holidays, they leave him with Anna to mind and take for walks alongside her own little buddy.

When the neighbours get home they throw Anna a few bob, and this gives her the idea that maybe other people might want someone to walk their dogs.  She asks around the neighbourhood and manages to find a few more people who need some help walking their dogs, and before you know it, she’s managed to put away enough pocket money for a new laptop..once she’s paid her business expenses in the form of some new trainers and a lot of small black plastic bags.

Painting cards and walking dogs don’t seem similar, but they share important aspects: these teens had goals, and considered the resources they had available – both had experience in their chosen path, and both had ready access to supplies and a customer base.  

They also had to do something else:  keep track of their expenses. Whether it’s watercolour paper or dog treats, they were spending money to help keep their business growing.  

Another factor to figure into your expenses is time. Time spent painting or walking any number of dogs  is time that Anna and Michael don’t have for studies, or hanging with friends, or even sleep.  Finding that balance is a big part of a healthy lifestyle, and accounting for your time is a big part of managing your business.

How do you price your goods or services? Time figures in as a concrete factor in your expenses; If you spend time doing something, you need to be compensated for that time, so your prices can reflect the ‘production time’ as well as the materials cost.  

However, be warned:  people who do not participate in your field may not understand why things cost what they do.

This is where you cheerfully remind them that your adorable handmade toy is unique and can’t be duplicated in a mass market situation.

So whether you want to be a professional artist, dog walker, or just want your hobbies to pay for themselves, there are a few things that you’re going to have to account for…

Sorry, that’s a terrible pun.

Keeping track of what you’re doing, what it costs, and what you’re making and where it’s coming from and going to can be the map on your road to financial success.