For many entrepreneurs, starting a business can seem like a daunting task at first, but for those who are brave enough to take the plunge, the rewards are usually worthwhile.

Senior Corporate Manager of JMMB Group’s Small and Medium-sized Enterprise (SME) Resource Centre Shani Duncan-Falconer explains that it is even easier to establish a business when you’ve been providing products and services as your side hustle.

Although you won’t have to start from scratch, she explains that there are a few tips to ensure you transform your side hustle into a business effectively.

Firstly, JMMB stressed that it’s important to set realistic goals.

“The first thing is that they are working already with their side hustle. What they were using it for is for extra income, but if you are going to transition into using your side hustle as your main business you need to make sure that you set financial goals and make sure they are realistic,” said Duncan-Falconer.

Similarly, those who are ready to make the transition should equip themselves with proper money management.

“You’re going to have to use your main income as your side hustle. So you need to make sure that whatever you were making before can sustain your lifestyle. You’ll also need to cut back because most businesses start small and they will take a while to build up to where they want it to be,” she continued.

In the same vein, Duncan-Falconer cautions against mixing personal funds with business funds.

“Make sure you open a business bank account. I tell people to start doing this before they transition into their full-time business. We need to make sure that you’re separating personal funds from your business funds so that you can see how much your business is really bringing in and see if that income is sustainable to actually pay yourself from your side hustle while you still have your business expenses.”

As for those who are operating informal businesses, Duncan-Falconer suggests becoming formal by registering the business.

“You have to register your business. Make sure that you go to the companies’ office and register your business and with registering your business you also have to be tax compliant. So you’d want to make sure that you go to TAJ. It doesn’t mean that you come the first year and you’ll be paying a lot of tax, it simply means you are compliant. So, even if you don’t make money in your first year, that is what you’re going to report; report what your earnings are, even if it’s a flat zero,” she advised.

In the meantime, she explained that there are many benefits attached to operating your own business.

“It’s definitely more satisfying, in terms of job achievement and goals, knowing that you are putting yourself into what you are doing and it is totally your business. In terms of emotional satisfaction, long-run financial satisfaction and in terms of leaving a legacy for your family and knowing that if you do have kids, that is something they can look forward to,” she stated.

At the same time, the corporate manager urged first time entrepreneurs not to go the road alone. She said finding a mentor will help smoothen the transition.

“Seek out a network of partners or people who are in the industry and who understand the industry so that they can really give you proper advice. It is always good to get a business mentor or business coach. So look at where you want to be, look at the industry you want to be in, and seek people out who are in that industry who can give you the real deal on if this is something to go into and also the encouragement in terms of going into it.”

She explained that creating a team is also important because the owner may not have all the expertise they need to operate the business alone.

“You have your advisor but then you have to create a team because you have to realise that you’re not going to know everything, so you need to bring in persons who are strong in different areas and build your team. By doing so you will be able to build your business,” she added.

Notwithstanding, Duncan-Falconer said she has realised a reluctance to transition side hustles into full businesses since the onset of the novel coronavirus pandemic, noting that entrepreneurs are managing their risks. However, she admitted that will change soon as things start to normalise.

“I see a lot of entrepreneurs who are still working and have their side hustle, but their side hustle is thriving and if they wanted to they could easily move over to their side hustle. So I would say that many entrepreneurs are still in the phase of moving out and especially because of the coronavirus pandemic. People don’t really want to give up their income right now to go fully into the side hustle, and I think as we come out of it people are going to start moving to that more,” she said.