Is is a hobby, or a business?
Grand Tiki
lead you to that answer.
My definition is much easier: If you focus *only* on operations
issues, you have a "hobby".
If you also have a strategic vision in place, you have a "nice
business".
With all that PLUS a strong administrative component (defined systems,
procedures, and data collection guidelines that allow a non-owner
employee to correctly perform operations without constant
supervision), you have a "viable business".
Examples ---
Operations thought processes: "Do I use flower cups or styrofoam
cups?" "What should I charge?" "Is a block shaver really that much
better than a cube shaver?" "I have to pee -- will this line ever
end?" ;)
Strategic Vision thought processes: "What should I do if another
snoball stand opens across the street?" "How many days a week can I
really be effective at work, and how many employees would be needed to
allow me some scheduled days off (to recharge myself)?"
Administrative thought processes: "How do we measure what effect our
marketing efforts have on sales (that don't require guessing)?" "What
would happen to the business if I was suddenly in the hospital for two
weeks?" "How does a new employee learn how to handle a pissed off
customer properly?"
All of these levels can be very profitable. The difference is that at
the hobby level, all the returns require persistent involvement of the
owner. (IE: standing there shaving ice every day) At the "Viable
Business" level, the owner
can withdraw from day-to-day operations (into brief supervision duties
only) and concentrate instead on cloning the success. A viable
business operator will earn many multiples of what a hobby operator
does (but with less headaches.)
There are only "so many hours in the day" by yourself. Eventually you
reach a limit of what you can perform yourself and max out your
potential results. If instead, you can "buy more hours per day" by
hiring employees, you can spend time doing the things that "only you
can do right" and delegate the "trainable" stuff to others.
The best explanation of this is found in this book, (my #3 "must
have") which I overlooked in my post about the entrepreneur's
bookshelf yesterday:
The E-Myth Revisited: Why Most Small Businesses Don't Work and What to
Do About It
http://www.amazon.com/E-Myth-Revisited-Small-Businesses-About/dp/0887307280
These are not "one size fits all" answers though. There are different
types of shaved ice operations, and though they sell the same product,
the philosophies are quite different.
Roughly I see two types of shaved ice businesses: "On-going" and
"Transient".
The "On-going" category is populated with shaved ice businesses that
have predictable hours with a fixed location.
"Transient" includes those who work special events, festivals and
other mobile operations. (Some people in this forum do elements of
both, so that "line" is fluid.)
The difference between the types of operations if analogous to
"fishing" vs. "hunting". *Both* will put meat on the table, but they
have very different mindsets.
An "On-going" owner is fishing. Drop your line in the water and wait
for fish to bite. If you find a good hole, you can keep pulling in
fish after fish with modest effort. You can hire someone of limited
competence to keep harvesting fish while you go look for more fishing
holes (or even go lay under a tree and take a nap.)
The flip side is that if your chosen spot is dead, you're pretty much
screwed unless you can somehow chum the waters around you and draw
fish. You need to carefully pick your spot.
"Transient" operators are hunters. To be successful they have to keep
moving, observing the environment, and adjusting their activities to
account for conditions. If these woods are devoid of game (or already
full of other
hunters), they can go to the next stand of trees very easily.
If a hunter manages to bring down the occasional elephant, the village
eats very well indeed. The down side: the hunter must continue to hunt
all the time. If you stop (even briefly), there is no persistent
reward for your past efforts as the meat will quickly spoil. It is
very difficult to "train" someone to do the vital hunting tasks,
because once you do they will likely buy their own rifle and become
your competition for the limited herd of game.
The bottom line:
You have to look at your specifics, apply the knowledge, take a guess
as to "The Best" choice, measure the results (if possible), and be
willing to re-adjust/fine-tune based on the new info.
That makes it much more likely you will be a success.