Many dream of the day when they can quit their day job and jump into building their business. Unfortunately, businesses take time to become profitable. Before taking the plunge, I encourage aspiring entrepreneurs to keep their day job, and start building their business on the side.
Yes, it is more work and your focus is divided, but it’s a great test to see if you are truly committed to the business or if it was just a passing interest. The exercise can also help you develop time management strategies that will work for you as your business grows.
To get you started, here are some simple steps.
1. Figure out when you’ll ‘clock in.’
Each person has differing levels of productivity, but I do recommend coming up with a realistic estimate of how much time you can set aside weekly to work on your side business. (I recommend at least one to two hours a week, or even five to ten). More hours don’t always lead to better results but what’s important is to arrive at a focused schedule that is realistic and consistent.
As you consider your schedule, work back from the type of business you’re building and what it needs. If you’re offering a service, like teaching yoga on the side, it will take you at least 60-90 minutes to teach the class, plus roundtrip travel time, and then there’s the time before and after to interact with students.
That requires around two to three hours or more. Do you have that kind of time to set aside? If you instead decide to create a product, such as cupcakes or an e-book, it will still take you time to create and perfect that product, not to mention find a customer base for it and get the word out.
2. Get strategic.
Don’t skimp on things like sleep, exercise or family obligations. But do rethink your personal to-do list. Be creative about the tasks you can delegate or automate to carve out the time you need.
Some things you can likely skip entirely. As you work on your business, think about ways to automate and outsource back office tasks for your company like billing and accounting to devote as much time to your core service or product as possible.
3. Decide which tasks you can share.
Just because you’re starting a business on the side, doesn’t mean you have to go at it alone. I’d encourage you to recruit some partners, especially in areas where you might feel like you lack expertise.
4. Set a target.
Calculate how much money your company will need to generate consistently before you say goodbye to your steady salary or hire help. Backtrack by asking yourself:
How much would you need to charge and how many customers would you need in order to hit that target?
What does the cost structure look like to handle that many customers? Too often people set a target but fail to realise how much working capital they need to handle the customer load that goes along with it.
Is the type of customer you are going after willing to pay the amount you want to charge for your offering? And are there enough people that who need what you’re offering?
Why You Should Trademark Your Cannabis
Brand owners take note. The movement to legalise the possession and consumption of cannabis is real. With the growing global trend to recognise cannabis as legal it can only be a matter of time until various other cannabis products will be legalised too.
Canada is the first G-7 country allowing the legal consumption of recreational cannabis having passed the Cannabis Act on 21 June 2018 regulating the growth, distribution and sale of recreational cannabis in Canada.
Although the USA still regards the use and sale of cannabis as illegal under Federal Law, with nine states and Washington DC permitting the recreational use of cannabis, absolute prohibition in those states has effectively stopped. Benefits shown by the use of medical marijuana is a large contributor to this change.
In September 2018, the South African Constitutional Court ruled that certain provisions of the Drugs and Drug Trafficking Act and the Medicines and Related Substances Act are unconstitutional as they infringe upon the right to Privacy in terms of Section 14 of the Constitution. An adult may now possess and use cannabis in private for personal consumption in South Africa.
The opportunities to create new brands for cannabis-based products are endless and so too should the requisite protection of intellectual property protection be in place in the territories and, in respect of trade marks, classes of relevance.
Earlier this year nearly 1,700 trade mark applications and registrations could be found on the Canadian Trade Mark Database covering cannabis. In June 2019 it is anticipated that the requirement for “use” to secure trade mark registration will be removed from the Canadian Trade Mark Law encouraging even more trade mark filings.
Regardless of the Territory, two principles should be kept in mind when choosing a trade mark:
- The trade mark should not be contrary to public policy (contra bonos mores) or likely to give offence to any class of persons; and
- A trade mark should not be descriptive of the kind of quality or other characteristics of the product.
Anyone looking to diversify into cannabis products would be well advised to identify their consumer, create their brand and file their trade marks before others do.
Why You Should Consider Renewable Energy To Power Your Business
Can your business afford the 33% electricity hike that Eskom is proposing? If not, you should look into some of the renewable energy options South Africa has to offer.
In the past there was load shedding, now there are proposed high price increases, and more potential load shedding due to the strike action. Many businesses previously resorted to generators as alternative energy sources, but with the growing customer demand for more environmentally conscious options, they won’t be satisfied with this alternative energy solution.
Keeping a business operating in South Africa is hard enough without losing funds every time the electricity goes out, and although generators are known as the back-up, with the increase in petrol/diesel prices is this still a feasible long-term solution?
You may want to consider a more permanent renewable energy alternative, to both reduce your electricity bill, regardless of future tariff hikes, and demonstrate that your business cares about the environment.
How Brigid Prinsloo Made (A Lot Of) Money On Airbnb
With the explosive success of Airbnb, the property investment landscape is changing. An increasing number of property owners are finding that it’s far more lucrative to rent out a property by the night than to install a long-term tenant.
It is possible to build property riches starting from a small base. This couple shows you how they did it. They’ve also launched a business that makes it easier to rent your property on Airbnb.
Although Brigid Prinsloo is a dyed-in-the-wool Capetonian who absolutely loves the city, she isn’t spending a whole lot of time there right now.
Like many young people, she’s pulled up stakes and hit the road, determined to see the world. When Entrepreneur spoke to her via Skype, she was busy exploring Vietnam with her Fiancée.
But, unlike many people who finance their travels by selling their homes and possessions, Prinsloo hasn’t liquidated her assets.
Instead, she has done the opposite – she has invested in a couple of properties that she lists on Airbnb.
The income from these rentals is significant enough to not only cover their respective bonds, but to bankroll her travels as well.
How has she managed it? And, more importantly, is it something that others can accomplish as well? Entrepreneur asked her to reveal the secrets to making a killing on Airbnb.
1. Getting Started: Listing Your First Property on Airbnb
How did you start listing on Airbnb?
I used Airbnb during a trip to London and Dublin, and the experience was a very positive one. When I got home, I decided to try being a host. My fiancé and I had a spare room in our flat, which had morphed into a dishevelled storage room.
Almost on a whim, we decided to try and rent it out on Airbnb. We had a very ‘Lean Start-up’ approach to the whole exercise. Our small room acted as a minimum viable product (MVP), we listed it simply as a way of gauging interest.
Well, within an hour of listing the room, we received our first inquiry. Within the first day, we had our first booking. We weren’t prepared.
We ended up moving our own comfy bed into the room, just to ensure our guest could enjoy a decent night’s sleep, and slept on a spare bed ourselves.
By the end of that first month, we had earned close to R10 000 by renting out the room. The rent for our entire two-bedroom flat was R10 500 per month. We realised that we could earn a tidy sum by renting out an entire flat.
My fiancée and I purchased a property that we now rent out, and I also purchased a second property with my dad and my sister, which we’ve also listed on Airbnb.
Resource: New Ways SMEs Can Find Funding
2. Return on Investment: Making Money on Airbnb
How much income can you expect to earn on your Airbnb property per month?
There are obviously loads of different kinds of listings on Airbnb – everything from cheap spare rooms to lavish mansions. Based on the investment we’ve made, though, I’m very happy with the return we’ve seen.
If you take the entire amount that my fiancée and I have earned from renting our flat out through Airbnb and divide that by the number of months that it’s been listed, the average monthly earning is about R23 000.
And this is a property that had been rented out to a long-term tenant for about R6 000 by a previous owner. What’s great about this sort of investment, of course, is that the income generated is fairly passive, which is why I can afford be in Vietnam while everything ticks over at home.
3. Birth of Superhost: An Airbnb Management Company
Is there an easy way to manage multiple Airbnb properties?
If you’re renting out one room – or even one flat – managing your rental is fairly easy. However, once you start listing a couple of properties, managing them can become quite a task.
For example, someone needs to welcome guests and hand over the keys, ensure that the flat is clean, and even take care of all the admin that goes with managing a listing on Airbnb.
We started a service called Superhost SA, which assists Airbnb hosts in managing their listings. As the popularity of Airbnb has grown, companies focusing on offer management services have popped up in lots of major cities.
Resource: 10 Businesses You Can Start Part-Time
For around 17% of the revenue earned, a company like Superhost will assist with the nitty gritty of renting out a space on Airbnb.
4. Location, Location, Location? Which is Best for Airbnb Property Owners
How important is location when it comes to listing a property on Airbnb?
Location is important, there is no doubt about it. A lot of travellers will judge a listing by what is within walking distance of the space.
So it is worth trying to get hold of a property in a decent location, even if it means you might have to go for something a tad smaller.
That said, however, you’ll find that the listings on Airbnb in Cape Town are surprisingly spread out. Services such as Uber have made it easier for people to travel in foreign cities. So location is important, but you certainly don’t need to be situated in the very heart of town.
5. How to Build An Airbnb Property Empire
Can you build real wealth through Airbnb listed properties?
Some people are using Airbnb to build empires, there’s no doubt about it. You find that some people in large cities like New York have massive Airbnb portfolios with 200 listings.
Airbnb is providing an interesting alternative to the traditional strategy of buying properties and renting them out to long-term tenants to pay them off. You can make far more money from Airbnb.
That said, Airbnb isn’t going to turn you into a multi-millionaire overnight. Building up a portfolio will take time.
We might be able to pay off the bond on our flat in four years instead of 20 thanks to Airbnb, for example, but it’s not a get-rich-quick scheme. It will still take time.
Another interesting way to potentially make money through Airbnb is to rent a property and list it on Airbnb. But you don’t want to do it illegally.
Airbnb has had to deal with some backlash overseas because of tenants who were illegally subletting their flats. You need to be honest with the landlord and make sure that he or she is okay with it.
6. How to Make Your Listing Stand Out
How do you achieve and maintain a high occupancy on Airbnb?
A lot of people are noticing the income potential of being an Airbnb host. In fact, Cape Town alone now boasts close to 10 000 listings on the website. So how do you make your listing stand out? Here’s Brigid Prinsloo’s suggestions:
1. Create a pretty listing
Hide the laundry, flush the toilet and make the bed before you upload an image of your flat on Airbnb.
Not only should the flat you’re listing look clean, modern and inviting, but you should also make sure that you post excellent pictures of it online. It’s even worth making use of a professional photographer.
2. Undercut the competition
You might not be better, but you can certainly be cheaper. Undercutting the competition is a worthwhile strategy.
The more people have visited you, rated your place and commented on your service, the higher your listing will be placed on the website. This means that new hosts can find themselves languishing at the bottom of search results, far from the eyes of potential guests.
Prinsloo suggests listing your space just below the market standard (5 – 10% below). “Most people filter search results by price, so being slightly cheaper than the competition will help you get noticed,” she says.
3. Connectivity is important
Around 70% of South African Airbnb guests are from overseas.
While these people won’t be travelling thousands of kilometres to sit in a room and watch TV, they’ll probably still want access to DStv.
Wi-Fi is another must-have for those looking to share their ‘African experience’ on social media. And it better be fast and uncapped.
4. Be friendly and helpful
As mentioned, reviews are important on Airbnb. And if you want to receive a good review you need to provide a great experience.
“A lot of people are looking for that personal peer-to-peer experience. They don’t want to feel as if they’re living in someone else’s room with their clothes in the cupboard and toiletries in the bathroom, but they do appreciate that personal.
Being friendly and helpful goes a long way. If someone is from out of town, it’s a good idea to provide them with hints on where to go and what to do in the city,” says Prinsloo.
5. Add personal touches
You’re not a hotel, but you can still try to make your space as cosy and inviting as well. A good way of doing this: Provide those nice-to-haves like soap, shampoo and great coffee.
Related: 10 Tips for Finding Seed Funding
Prinsloo always provides a couple of bottles of local wine as well.
7. The Risks of Listing a Property on Airbnb
What are the risks associated with listing a property on Airbnb?
Whenever you hand over the keys to your house and possessions to complete strangers, there is an element of risk involved. However, Airbnb tries to mitigate this risk by allowing hosts to vet guests (and vice versa) to an impressive degree.
Guests and hosts verify their IDs by connecting to their social networks and scanning their official ID document. Although there are some horror stories out there, listing needn’t be terribly risky.
You just need to try and make sure who you’re dealing with.
What happens when a guest breaks a leg while descending your stairs, chops off a finger with your kitchen knife or shocks himself with your electric fence (foreigners aren’t as familiar with electric fencing as we are).
We live in an increasingly litigious society, and should something go wrong, you could find yourself being threatened with a lawsuit. Because of this, it’s a good idea to ask guests to sign a waiver that absolves your from any culpability.
It’s great when guests arrive, but what happens when they won’t leave?
Airbnb rental falls into a murky category of property rental that could see you deal with the same legal hassles as someone trying to get rid of squatting long-term tenants. Squatter’s rights can make this very difficult.
It is a good idea to consult a lawyer to help draft a contract that will offer some form of recourse in the event of squatting guests.
Some body corporates and home-owners’ associations will be less than impressed with the prospect of total strangers coming and going from your property at all hours.
You need to ensure that other home owners don’t have problem with the listing of your property on Airbnb. The last thing you want is for them to take their frustrations out on your guests.
Self Development2 weeks ago
10 Secrets To Finding A Job You Love
Performance & Growth1 week ago
How Matt Brown Quadrupled His Business By Becoming A Niche Player
Entrepreneur Today6 days ago
Entrepreneurs Organisation Crowns the Winner of the Global Student Entrepreneur Awards
Branding2 weeks ago
How A Strong Brand Protects Your Business
Entrepreneur Today3 days ago
5 Businesses You Should Start in 2019
Marketing Tactics2 weeks ago
An ‘Outside-the-Box’ Approach to the e-Commerce Unboxing Experience
Hiring Employees2 weeks ago
Are You Hiring A Cultural Fit? Do You Actually Want To?
Business Landscape2 weeks ago
4 Tips To Create A Great Conference / Workshop / Event In 2019