Wouldn’t it be nice to earn money in your sleep? What about working only one day a week on your business and earning a full-time income? Obtaining passive income is well sought after these days given the fact that so many people want to get out of the rat race.
Unlike passive income, active income requires your constant involvement and effort and often pays by the hour or per project, meaning you have to trade your time for money. With passive income, you do all the hard work upfront to establish your stream(s) of income, then you most likely outsource tasks and set up processes in order to allow the income to start flowing in with minimal effort you your part.
Having an online passive income business sounds great because you get to keep all your free time to do things that you enjoy and that matter most while still bringing in plenty of income each month. While it sounds like the best of both worlds, first you need to establish a business niche and decide how you will make it passive.
Making a Business Passive
Step 1 involves narrowing down your business idea and determining whether it will be profitable. It’s best to settle with an idea that allows you to offer a product or service that will be extremely valuable for a specific targeted group of people. Just because you think your idea is great, doesn’t mean everyone else will see the value and be persuaded to buy so this step is extremely important.
Step 2 involves investing your time and money into your new business, creating a strong platform, and establishing the foundation for your products or services. At this phase, you’ll need to determine how much money you will put into your new venture.
Will you hire a business coach or invest in any training for yourself? Will you get help for your website from a graphic designer or bring an assistant on board? This step is a hard one, because it will require numerous hours of planning and execution as you test out different ideas and start building them up from scratch.
Step 3 includes building up a following and customer-base along with implementing marketing techniques and promoting your business. Promoting yourself and your brand is crucial since you’ll want to see how well you relate to your target market and which techniques help them respond. Once you’ve built up a solid customer-base, the payoff for all your hard work will start to surface as income starts to trickle in.
Step 4 involves slowing down a bit, hiring a reliable team, setting up processes that allow your business to run smoothly and repeating the cycle all over again so you can sit back and collect the income your business generates each month.
There may be some unexpected bumps in the road, but these four steps generally describe how a passive business is established. Now, if starting a passive business is something you may be interested in, here are 3 business ideas that you can develop into passive streams of income.
1. Create an Online Problem-Solving Course
Have some valuable skills you’d like to share with others? Position yourself as an industry expert and develop an e-course. Tons of people are creating e-courses these days and for the ones who are successful and generate a lot of sales, there are often two common factors:
- They established steady and faithful following through their online presence
- Their course is solving a major dilemma people face which is why customers find it so valuable and are willing to spend money on it
Identify a target market and a major issue that they face, then design a beneficial and interactive course to help solve that issue. Whether you create a video course or an email course, focus on packing it with reliable research, helpful tools,and actionable tips and advice and consider how you will market it to others.
Some people get media attention by guest posting on other blogs and websites while others will land guest spots on popular podcasts or solicit interviews, while others involve their network by offering an affiliate program so people who refer others to the course will receive a small payout incentive.
Once your course is completed, polished, and ready to go, you can start your marketing efforts and just sit back and relax. You may need to provide updates for the course every few months or do some more promotion or publicity, but you can always hire someone for those tasks plus it shouldn’t be too time consuming anyway.
2. Start a Blog or Website
This is an idea I thought about moving forward with myself. While it’s no secret that you can earn money from having a blog, turning a blog into a passive business is also very possible as long as you are willing to invest a lot upfront.
Starting a blog that needs to be updated regularly is much more time consuming than setting up a website with a few pages that remain static for the most part. However, having an active blog can bring in way more income over time.
To make this business a passive one, you’ll need to outsource practically everything. Hire entry level writers who can understand your vision and authentic message that the blog needs to communicate to readers. After you’ve got some stellar content on the site, make sure you optimize it and hire someone to market your blog to your target audience and other brands for a potential partnership or sponsored post.
Once you start obtaining more page views, you can start putting ads on the site to generate income each month and start embedding affiliate links in your content when appropriate so you can earn money for referring a reader to a product or service.
Initially you may have to edit content and pitch your site to others, but once you get some momentum going after several months, the site will start to generate its’ own income while you focus on other areas of your life.
3. Start a Drop Ship E-commerce Business
If you’d like to sell items online for a living, consider a drop shipping business. This basically involves setting up an e-commerce online store and allowing customers to purchase products from certain manufacturers on your site.
When an order is placed, the manufacturer will receive it and ship the product to your customer. As a result, you won’t have to go through the trouble of creating several products yourself. Your main responsibility will be legalizing your business first and taking care of the all marketing and getting the website up and running. Again, you can outsource these tasks to buy back your time.
When I was in college, my sister launched an online apparel boutique and used drop shipping to fulfill all the orders she received. She hired me to help write press releases and articles online that would link back to the site. She also hired an answering service to pick up the phone during business hours if customers called with questions or issues.
She worked tireless to build her business by attending networking events, trying new marketing strategies, building email lists, running campaigns for sales and so much more. The whole time I kept thinking, she can outsource a lot of this stuff once her business blows up.
A Passive Business May Take a lot of Effort Before you Start to See the Results you Want
The truth is, it can take a while to establish passive income or a passive business. It can’t be done without putting in a lot of effort and strategy at the beginning stages; unless you have a ton of money to invest right off the bat.
It’s important to remain committed to the idea you developed in step 1 or start to consider another idea or business model if it doesn’t seem promising. The key is sticking it out with your business in order to see passive rewards.
If you were to start a passive business, what would that business entail?