You have an interest — it's all-consuming. You think it's fascinating and there's bound to be a way of making a living out of it. You might not be Jane Asher with her famous cakes, but there's got to be some way of turning your passion into gold.
You might not be Jane Asher but, funnily enough, Jane Asher is. She set up her cake shop in Chelsea after writing successful books on cake making and sugarcraft. "I remember people sending me cuttings from American magazines with cakes copied exactly from my books. Which is fair enough — you write a book, they do it and sell them." She felt she ought to do something to capitalise on what was obviously a popular idea.
At this point business sense had to take over from enthusiasm, and Asher, deliberately or otherwise, set herself rigid criteria on how to make it work. Any shop she owned had to be close to home, as she had no intention of giving up her day job or abandoning her family. "I think that's probably typical of women entrepreneurs, without wanting to be sexist," she says. "You develop your interest into a business for those sorts of reasons."
Straightforward borrowing
Asher lived in Chelsea, which is affluent, so the demographic was able to afford hand-decorated cakes. Money was unexpectedly straightforward. "It wouldn't happen now, but I walked in and I saw a bank manager I'd known for some time. I said I wanted to start a small business, he said 'my wife loves your cake books'. I borrowed £80,000 and opened the shop."
Then another piece of business sense kicked in — finding a business manager. "I knew that if it succeeded I'd still want to go back to my real job much more full-time when the children had grown up. This was the only time I went to an agency. A catering agency sent me a number of people and I remember when I interviewed Ruth Clark, who's still with me, I was in full 18th-century dress at the National!"
Asher's inexperience showed early on: "We underpriced drastically," she explains. "I took a stab at what a cake should cost without any sort of system. I then decided we had to take X amount an hour for staff, rent, rates or whatever — eventually we worked it out. Initially it was very hard to judge how long a cake would take to make." She also spent too much. "I was persuaded into a lot of
marketing I needn't have done. I didn't think it was necessary, but designers are very good at persuading you that these things are."
Asher admits that having a well-known name was invaluable, but not everybody has that advantage. Claire Novis started belly dancing classes after reading an article on holiday. Eventually things moved on and she was asked to stand in for a tutor and later qualified to teach herself. Starting up required a whole new set of skills and knowledge.
"I was determined that if I was going to do this, I was going to be as professional as possible in the service I offered, and therefore wanted to be legitimate in what I was doing," Novis says. "But what do you need to do to make sure you're abiding by all the rules, insurance and tax requirements?" She recommends a visit to the HMRC website (hmrc.gov.uk) as a good starting point.
Marketing has become easier through her website (clairedances.co.uk). She runs the business alongside her full-time job as a senior geologist. "On opening my car boot you're often, therefore, confronted by the rather confusing view of half of it being filled with hard hats, high visibility jackets and steel toe-capped boots, with the other half being filled with hip belts, chiffon and sequins."
Mark Lee, independent business adviser and founder of the Tax Advice Network, was advised to become a children's entertainer early in life. He decided against it because of the hours professionals work.
"My wife is avoiding this trap by keeping her card-making activities as a hobby," Lee says. "She loves making cards for friends and family birthdays, anniversaries and special occasions. This is a labour-intensive activity. She doesn't want the pressure of having to make hundreds at a time and we also know that the income she could make would not justify the time and effort, even if the cards all sold quickly."
There's also the problem of detachment, he adds. "Many people make that mistake and assume that their passion will be sufficient. Market research — beyond asking friends and family, who will be biased, is critical. And then you have to be prepared to adapt your business model to reflect what the marketplace wants."
Author Emma Jones heads up the Enterprise Nation website and agrees that it's easier to spot a gap in the market than to "make sure there's a market in that gap." She urges people to check how many customers and competitors — with whom it might be easier to cooperate than compete — there are. Above all, look at the commercial reality of a venture. "Look at what others are charging and the price you think customers will pay," she says. "Then work out if this figure, multiplied by a conservative estimate of customer numbers, is enough to get the business up and running and keep it afloat."
After mastering sales, marketing. cashflow, employer skills and tax affairs, readers will be relieved to hear it goes from impossible to just pretty difficult. It can work spectacularly. Jane Asher isn't the only one to turn a profit, but without sensible help and some objectivity she may not have succeeded.
