©Pressmaker / Adobe StockIf you've decided to join the side-hustle world, and you've brainstormed your side hustle idea, you'll want to start pulling together a business plan.
For help with exploring side-hustle ideas, brainstorming, and the planning steps that lead to this business plan phase, check out my book Side Hustles For Dummies.
If you’ve ever done a jigsaw puzzle, you know that you typically start with a little portion of the overall puzzle in, say, the top left corner. Then maybe you shift to working on the bottom right side; then move to somewhere in the middle; and so on. That's sort of how you put a business plan together — a document that eventually shows the whole picture.When it comes to business plans, you have a little bit of a challenge on your hands: If you put 10 people in a room, you’ll get 20 opinions about what a business plan should look like!
You’ve probably come across this same problem when you worked on your résumé, with one person telling you to structure your résumé one way, and another person indignantly disagreeing and insisting that you write your résumé a totally different way!
I have some good news for you when it comes to trying to make sense out of all the different guidance you’ll find for how to write a business plan: For a side hustle, you have a lot more leeway in the order of topics that you cover — and even what you do and don’t include — than if, say, you’re putting together a business plan in search of a large bank loan or millions of dollars of venture capital investment.
Maybe, someday, if your side hustle really hits its stride and starts growing toward your ideal scenario, you’ll have to worry about making sure that your business plan matches the structure that a bank or private equity firm, or some venture capital company, insists on seeing. For now, though, think in terms of pitching your side hustle to yourself — an audience of one. Are you painting a cohesive and compelling picture of how to get your side hustle going?
If your side hustle is a gig-economy job, such as delivery services or ridesharing, you can probably skip over the whole business-plan stuff. However, if your gig services are along the lines of pet-sitting or bartending or doing handyman work — basically, if you’re setting up a small-business structure even though you plan to land gigs from side hustle–oriented platforms — you should at least jot down bullet points for most of the business plan sections.
Your side hustle business plan should include the following sections.
A short overview and a really short elevator pitch
If you're in the business plan phase of your side-hustle planning, you should be able to clearly articulate exactly what your side hustle is going to be, so write it down! In fact, write it down twice!Start off your business plan with both:
- A one-paragraph (two paragraphs at most) highly summarized version of every key aspect of your side hustle
- A single-sentence elevator pitch that summarizes your summarized version (got that?) even more!
Having an elevator pitch means being able to describe an idea so persuasively in about the duration of the typical elevator ride that the person to whom you’re talking is crystal clear about the most critical or unique aspects of your concept.
As an example, one side-hustle starter's — let's call her Sarah — business plan starts with:"I will design, craft, and sell custom-made jewelry. I will build a Shopify site that I will promote using online marketing and advertising techniques, such as Facebook and Instagram ads, Google Ads, and short demonstration videos on YouTube and TikTok, that will link to my site. I will run the business out of my house. I’ve lined up primary and backup suppliers for all materials and tools."
Then Sarah adds her elevator pitch:
"I will sell custom-made jewelry from my Shopify site that I will promote through a variety of online ads."
As Sarah works her way through the rest of her business plan, she can refer back to this section and adjust the wording as necessary. For now, though, she has placed a stake into the fertile side-hustle soil and is ready to start planting.
Your time commitment
Your business plan is for a side hustle, so you need to be crystal clear with yourself about exactly how much time you plan to spend on your venture. Plus, if you have specific time constraints, like “only evenings after work,” or “only on weekends,” or “only on Wednesday evening and all day Saturday,” you need to acknowledge these constraints and write them down.As you go through the rest of your business plan, you now have an “official statement” that describes your available time that you can use as a sanity check for your side hustle’s details.
For example, suppose you plan to do software development on the side. However, because of extra hours you need to work at your full-time job, you only have about 15 hours a week available for your side hustle.You can certainly take on a little bit of software development here and there, but you’ll need to focus on shorter-duration tasks, such as building template-based websites or doing some light software configuration rather than heavy-duty application development.
If you don’t have a full-time job and, instead, have a portfolio of several different side hustles, documenting your available time is still important to help make sure that your side hustles don’t clash because of conflicting demands for your time.
Your schedule and major milestones
Whatever your side hustle is, you have an idea of what you'd like it to be in the future. Maybe your longer-term plan is built around expanding your business, or maybe you have no intentions of growing your business at all, and you just intend to get a little business up and running and keep it going.Think about what your side hustle will look like in time increments that make sense for you — three or six months from today, in a year, three years, etc. Regardless of your expectations and the timeline for those, document it all in your business plan, along with key milestones and decision points along that timeline.
Key players in your side hustle
Your business plan also should include the other people and companies you'll need to connect with. If you plan to make and sell clothing, who will be your wholesale suppliers? Who will be your key points of contact — the actual people — at each one of those wholesalers?As another example, if your side hustle will be buying and selling baseball cards and other sports collectibles, will you do this via eBay, or other auction houses? Revisiting our jewelry maker, Sarah, who will be her suppliers of metals and tools?
No matter what your side hustle is, and even if you’re going solo, you’ll almost certainly be involved with other people and companies at some point. Write all of these details down in your business plan, including any designated backup companies or services that you may switch to at some point.
Your customers
You need to identify who will comprise your target market (the people to whom you’ll try to sell your products or watch your videos or take your course, or for whom you’ll provide weekend landscaping or bartending services, or whatever your side hustle is).Sometimes, your target market can (and should) be as broad as possible. After all, if you have a potential customer out there somewhere in the world, why not try to attract that person to your business? For example, you might be selling clothing and accessories online to “the world at large” — basically, anybody who wants to place an order on your website for a blouse or leisurewear or a necklace can do so. You might get to know some of your regular customers, but for the most part these customers will be anonymous to you.
In other situations, you should narrow your target market to better focus on catching the attention of a person or another business even more likely to be in your side hustle “sweet spot.”
For example, Sarah’s customer base will be broad, at least initially. At some point down the road, Sarah may wholesale her jewelry to other online and in-person retailers for them to retail. At that point, she needs to go back and adjust her business plan to more precisely target certain customers — maybe not specific names of people and businesses, but at least descriptions of the types of retailers to which she’ll sell her jewelry.
Startup money, budget, and financial projections
This part of your business plan includes how much startup capital you’ll need, how to budget, how to forecast sales and expenses, and more. Your business plan needs to include the key aspects of the financial side of your side hustle. (How to figure out all of these things is my book Side Hustles For Dummies.)Pretend that you’re pitching your side hustle to an investor, and you also happen to be that investor. Convince yourself that you have all your financial ducks in a row.
How you’ll operate
This part of your business plan should include the business processes through which you’ll operate your side hustle. And you should add as much detail as possible. For example, Sarah’s side hustle has nine internal processes: buying materials and tools, deciding on her product list, building her website and storefront, and so on. She needs to take each of those processes and break them down into the underlying steps that she’ll do. She can simply list the steps as bullet points or a numbered list.Risks and mitigation
It's important to consider the risks involved in your side hustle idea, and how you could mitigate those risks. List how you intend to counteract and neutralize the risk. As you’ve been working through your business plan, you may have come across a new risk or two, or come up with a new mitigation strategy for a risk that you’ve already documented. So, spend a little bit of time and take a fresh look at your list, and make any necessary updates.You can check out Business Plans For Dummies by Paul Tiffany and Steven D. Peterson for much more information about business plan structure and content, especially if your side hustle really catches on and you’re looking to take it to that mythical “next level.”