Did you know:
According to an Inc.com article 63% of 20 somethings want to start their own business. That’s a lot of people for even just one age group who want to spread their entrepreneurial wings.
The problem is what kind of business should you start?
As you’ve probably already discovered their is no shortage of business ideas to choose from, and this is also the number one question people struggle with when starting a side hustle.
To help you break this process down I’ve narrowed things down to 5 different types of businesses you could start. On top of that I will also give the up’s and down’s of each and even share some of the different types of businesses you could start within each type.
So if you’re not quite sure what kind of side businesses you want to start read on.
#1 Creating Digital Products
The first type of business you could get started with is creating digital products. Digital products would include anything from…
- Digital Courses
- Online Membership Programs
Whether you want to sell downloadable eBooks through Amazon Kindle or create and sell digital course through Udemy.com their is some serious money to be made here. However their are some ups and downs to this type of business model.
Upside to Selling Digital Products
- Low Overhead to get started you don’t even need a website, in fact you can use a third party platform like ones I shared in this article.
- Do the Work Once and get Paid Over and Over. If you create a course, eBook, or even a software product you can get paid over and over for the life of the product.
Downside to Selling Digital Products
- Can be Tough Getting Started. If you don’t have an audience or a mailing list to promote your product to you may have a hard time getting things going.
- Takes Time. It can also take some time to get your business up and running.
- Competitive. Finally depending on the market you are in it can be very competitive to get started.
Final Takeaway: If you’re looking for a business that’s more passive because of time and you’re not looking to spend a lot of money then creating digital products can be a great way to go.
#2 Physical Products
The second type of side hustle business you could start is creating physical products. Physical products would be anything from..
- Making Arts and Crafts
- Selling Private Label Products
- Creating Your Own Inventions
Whether you want to sell private label products on Amazon.com or sell your own arts and crafts one Etsy.com then selling physical products may be for you. Here are just a few up’s and down’s to selling physical products.
Upside to Selling Physical Products
- More Places to Sell. With sites like Amazon it’s never been easier to sell a physical product.
- World Wide Distribution. The other great part is that it’s also easier to than ever to sell your product world wide were in the past this was not possible unless you were a larger company.
Downside to Selling Physical Products
- More Overhead. With physical products you’ll have more cost in overhead for materials and labor to create the product.
- Bigger Risk. It’s also a bigger risk to sell physical products because if you can’t sell what you have you might be left with a whole bunch of product that won’t sell.
Final Takeaway: If you like the idea of creating your own physical product to sell and selling them on other sites like Amazon or eBay or even inventing your own product then this may be the side hustle for you.
#3 Offering a Service
Another way to earn an income from some sort of side hustle is to offer a service instead of a product. Services would include any thing from…
- Done For You Solutions
So whether you want to build websites for people or coach them through a very specific problem this might just be the option for you. This is personally one area that I have done the least amount of work in but I am interested in trying at some point.
However as everything goes their are upsides and downsides to this kind of side business.
Upside to Offering a Service
- Can Start Fast. The first thing that I like about this kind of side business is that you can get this up and running fairly fast unlike a product you might have to create.
- Huge Earnings Potential. Second the earning potential here is huge. Typically the more access you give someone to work with you the more you will get paid, and if people are working one on one with you can earn a good amount of money.
Downside to Offering a Service
- Trading Dollars for Hours. On the downside though when you are doing a service you’re typically working in a dollars per hour situation and if you are doing it on the side you will likely only have so many hours to do this kind of work.
- Your Not Building an Asset. The other downside to offering a service is that you are not building an asset that can pay you over and over. Unlike when you create a digital course, or write an eBook you can get paid over and over and you only have to do the work once.
Final Takeaway: So if you’re looking for a side business that has the potential to earn you some big cash upfront and you don’t want to create a product then this just might be the option for you.
#4 Selling Other Peoples Products
The Fourth type of business you could start is to sell other peoples products and services. Selling other peoples products and services would include…
- Affiliate Marketing
- Network Marketing
- Product Resale Arbitrage
So whether you want to join a network marketing company like Amway or sell other peoples products as an affiliate on sites like Clickbank then this could be an opportunity for you. Below are a few of the up’s and down’s when it comes to selling other peoples products.
Upside to Selling Other Peoples Products
- No Risk. When it comes to selling other peoples product you bare none of the risk because you don’t own the product and if it doesn’t sell it doesn’t cost you anything.
- Don’t have to Worry about Returns or Customer Complaints. If the customer returns or complains about the product you don’t have to handle any of it because it’s the companies responsibility.
Downside to Selling Other Peoples Products
- You Only Get a Portion of the Commission. When you sell other peoples products you may only get a portion of the sale. For example on Amazon you will only get typically between 4% and 8% of the sale. However other programs may pay a lot higher such as 50%. Each program is different and commissions will vary.
- Can be Harder to Sell. When you’re selling other peoples products they don’t nessisarily need to buy it from you because they can usually go somewhere else to buy it.
Final Takeaway: If you want no risk and minimal cost in getting started with your side hustle this can be an easier way to go versus creating, marketing, and selling your own products.
The final type of business you can start is around advertising. This where I got started my first website I added Google Adsense to it and in that time I’ve earned nearly $30,000 just on that one source of income. Here a just a few ways you could earn an income through advertising.
- Google Adsense
- Sponsored Post
- Direct Ad Placements
So whether you want run pay per click ads on your website or sponsored post advertising is actually very simple to get started with. Below are a few of the up’s and down’s when it comes to running advertising.
Upside to Advertising
- It’s As Passive as It Gets. With services like Google Adsense all you pretty much have to do is add a small snippet of code to your site and you’re good to go. From there once someone clicks your ad you’ll make a little bit of money.
- Not a lot of Work Involved. What’s also great is that this type of side hustle is not very time intensive. You can literally be up in running in a few hours and once the ads are up they’re not much to maintain.
Downside to Advertising
- Doesn’t Pay as Good. On the downside depending on the niche you’re in you may only make 10 cents a click. On top of that you’re not going to make as much as you would if you were to do any of the other types of side hustles I’ve mentioned above.
- Not as Much Control. Finally, when it comes to running ads you won’t have as much control when it comes to programs like Google Adsense. The ads could be your competitors websites or worse a product or service that you’re customers don’t find helpful. In the end you may not be in control of the ads are showing.
Final Takeaway: If you’re looking for a very passive type of side hustle that doesn’t consist of you managing a product you have to create or even someone else’s product then advertising may be the right kind of side business for you.
What Type of Side Hustle Do You Want to Start?
Now that I’ve shared the 5 basic types of side hustles you can start I want to hear your thoughts. Which one of the five interest you the most?
- Digital Products
- Physical Products
- Offering a Service
- Selling Other People Products
Let me know in the comments below.