Crochet Business vs Hobby – 5 Simple Questions to Help You Decide
For most crocheters (or any hobbyist) there is a fine line that defines whether you do something as a hobby, or whether you have a business. Most of us will start small and sell some items to friends who fell in love with something we made. But when do you cross over that line into having an actual business? At some point you may wonder if your crocheting is still a hobby, or if you’ve entered into the creative business world. Or maybe you want to take the plunge, but aren’t sure if you’re ready. I’ve built a simple list of questions to ask yourself that you may or may not have considered up to this point.
Crochet Business vs Hobby
Do you remember the 5 W’s from grammar class in elementary school? Who, What, When, Where, Why (and How). Those 5 W’s may help you decide whether your crochet should be a hobby or a business. I’ve broken each one down into an example of a hobby vs a business to help you decide.
WHO – Who are you making your items for?
- Hobby – Are your items primarily gifts and donations? Do you choose the pattern(s), color(s), and items you want to make?
- Business – Do you take orders from friends? Do you sell at craft fairs or consignments shops? Do you let other choose the pattern, color(s), and items they want you to make?
WHAT – What is your ultimate goal?
- Hobby – Are you happy just seeing the look on someone’s face when they open your gift? Or the feeling you get when you donate items to charity?
- Business – Are you hoping to help your family financially?
WHEN – When do you want to make them?
- Hobby – Do you want to decide if you want to make an item and when you want to work on it?
- Business – Are you prepared for the customer to tell you when they would like the item done by? Are you good with managing your time and keeping track of the deadlines?
WHERE – Where do you want your crocheting to take you?
- Hobby – Are you content to just crochet at night while watching TV? Do you only crochet occasionally when the mood strikes you?
- Business – Do you love reaching out to new people to promote your projects? Do you have a desire to learn more about the crochet industry?
WHY – Why do you want to crochet?
- Hobby – Are you just happy to make an item and then give/donate it?
- Business – Do you want to build an income and help your family financially?
….and the bonus….
HOW – How do you plan to accomplish this?
Passion. Plain and simple.
There is also the legal definition of hobby vs business and the IRS also has a list of questions to help you determine this. The very first question on their list is:
“Does the time and effort put into the activity indicate an intention to make a profit?”
For the complete list, see the IRS website here.
If you haven’t already, do you think you’re ready to take the next step and make your hobby a business? If you think you are, check out these posts I’ve written:
Starting a Crochet Business
How to turn your crochet hobby into a crochet business (guest post I did over @ Yarn Obsession)
No matter what you choose, just remember one thing . . . . crocheting should remain relaxing and fun.