In the days before the digital revolution, starting a business was a path reserved for a fortunate few with the means to gather the necessary resources. It required a significant starting fund, and finding external support was often tough unless you had connections in the financial and business world.
Fast-forward to the era of online commerce, and the rules have changed drastically. The demand for online businesses and e-commerce has surged, bringing with it a remarkable shift. Just in recent times, the expansion of e-commerce has been truly astonishing.
Nowadays, the opportunity to initiate and grow an online business is open to all, irrespective of your professional background or prior entrepreneurial ventures. Yet, while the entry obstacles have been greatly diminished, they haven't completely disappeared. Prospective business owners still need to craft a valuable product idea, sort out the best sourcing or manufacturing strategy, and then put in place a workable sales approach.
If you are wondering how to start an online business, you are at just the right place.
Before delving into the know-how of starting your online business, it is important to understand why you should choose to start an online business and why not go with the more traditional method of business.
Well, the reason is that starting an online business has a bunch of benefits.
For one, it doesn't cost a lot to get started. Lots of people want to start a business but are put off by the money needed to set it up. With a regular store, you have to pay for rent, buy products to sell, and plan for employee wages. If the business doesn't work out, it could really hurt you financially.
But if you go for an online business, you only require a few things:
A Website with your business domain
Tools to build the website
With an online business, it is possible to start with as low as ₹ 10,000. You don't have to put all your savings at risk to become a successful online entrepreneur.
When you have a regular store, you're held back by real-world stuff like expensive places to set up and only selling to nearby people.
But with an online business, you don't have these limits. You can sell to anyone, anywhere. And if the increasing numbers of people online are anything to go by, as time goes on, more and more folks will shop online, increasing the number of your potential customers. The more people online, the more chances for people to notice your online brand. And if you're open to it, you can even sell to people in different countries.
Here's another good thing about online businesses: they never close, not even during lockdowns or other problems.
Once your business website is up, you're ready to make sales all the time. People can buy from you whenever they want. And because you don't have to be there in person to make a sale, your business can make money without you having to work on it every single day.
Your business’s niche market is like the main group of people you're trying to help. It could be fans of a sport, people with hobbies, or professionals.
For your new business, you have to choose a special area. To figure out the right people to focus on, make sure they have:
A problem that no one else is solving.
A willingness to pay for a way to fix that problem.
Enough extra money to afford the solution.
Remember, even though starting an online business is easier, it still costs some money. Like with a regular business, the first thing to do with your online business idea is to check if it could work.
Even if you have a super smart business idea, it won't work if no one wants to buy what you're offering. Even if you've found the answer to a problem that lots of people have, you're wasting money if most people don't care enough to spend their time or money solving it.
So, you have to think about your idea. Here are a few questions you need to ask yourself:
Does your idea solve a problem that many possible customers have?
Does your idea give an affordable way to fix that problem?
Are people ready to spend money to fix the problem?
How much will it cost to reach the people who need your idea's solution?
Once you're sure your idea can work, it's time to make a detailed business strategy. Even if you're not planning to get money for your business right away, having a plan is useful. It helps you see any possible problems in the future and plan for growing your business and making money.
The work you did in the first step gives you a good starting point for making your business plan. There are lots of online resources that can help you put together the main parts of a strong strategy.
A good strategy will help you know more about your market, make your goals clearer, give you a plan for advertising, and help you make important choices that could decide whether your business succeeds or fails.
Choosing the name for your business is a big step when you're starting out. Since your business will mostly work on the Internet, the name you choose has to be free to use as a business name in your area and online.
This means you have to check if the name you like is free for:
Business name in your area (State/ Country).
Website name (domain name).
Usernames on the social media platforms you want to use.
If the name you want isn't available for a website or social media, think about using slightly different versions of it. Also, there are many different website extensions besides the usual ".com" that you can use. It's important to make sure your name and website name aren't the same as any trademarks that are already registered.
The way you organise your business affects the legal and tax rules you have to follow. Most small business owners pick from these options:
Sole Proprietorship: This is the easiest choice, but it doesn't give you limited liability protection, so your personal assets could be at risk if things go wrong.
Partnership: If you're starting the business with a partner, this might be a good option, but like a sole proprietorship, you don't have limited liability.
Limited Liability Company (LLC): An LLC provides some protection for your personal assets without the added complexity of a full corporation. It's a popular choice for small businesses.
Corporation: Similar to an LLC, a corporation offers limited liability, but it's more complex to set up and run. Depending on your situation, it could be a good choice.
It's a wise idea to talk to a lawyer to figure out the best way to organise your business. And since each option has different tax rules, you might also want to consult a tax expert.
Just like with a regular store, you have to take care of all the legal tasks to make sure your new online business is legally sound. This means:
Registering Your Business: You need to tell the right government people about your business.
Getting Permits and Licenses: Depending on what you're doing, you might need special permission or licenses.
Following Tax Rules: You have to do what the federal and state tax laws say, like getting ID numbers for taxes.
Since these rules can be different in each state and depend on what you're doing, it's important to do your homework to make sure you're doing everything right. It can also be helpful to talk to a lawyer who knows about starting businesses in your field to be sure you're doing things the right way.
An online business's website is super important, just like a real store's location. You should really think about this part of starting your business, just like you would if you were picking a store location and lease.
When you're figuring out how to make your website, think about how people will pay you. For a lot of online businesses, it makes sense to hire a website expert to help build your site.
Also, the company that hosts your website matters a lot. You can have a great website, but it won't work if the host's servers are often down or the site is too slow. Look at online reviews and ask people you know in business for advice. Other online business owners can be especially helpful in telling you if a host is dependable.
Depending on what you're selling, you'll need to decide where you'll get your stuff and how you'll send it to customers. There are a lot of choices here too. Since having the right stuff in stock (or a good supplier) and a reliable way to get things to customers is really important, take your time researching this part. It can make a big difference between your business doing well or not.
Even before you open your online business, you should start telling people about it. Your business plan will help you figure out the best ways to market to your potential customers. And when you decide on your marketing strategies, make sure you really follow through.
Use social media and ads to get your target customers excited about your launch. This way, you'll set yourself up for a successful start when you do open for business.
It's like opening the doors of a physical store but in the online world. When you make your website live and tell everyone you're open, that's your big moment.
You can announce your launch in different ways:
On social media
Through email to your subscribers
Using online ads
With regular ads
When you do this, you'll see the results of all the work you did to get ready for your launch. But remember, your job is far from over.
By following these eight steps, you've built a strong base for your online business, and now it's time to keep working and growing it.
By setting up your business step by step like this, you'll be in a better position to focus on running and promoting your new business instead of getting caught up in problems that could pop up if you don't take care of these crucial steps in the first place.