Creating an Effective Online Business
Online businesses are opening across the country as more people use the internet to shop for products and purchase services. Creating an online business is now an effective way to scale a company in a short amount of time. With the amount of technology available, business owners can pinpoint customers and deliver them products across the globe.
If you’ve ever thought about starting your own online business, you’ve probably wondered what the most effective approach is. This guide has been written to help prospective online business owners begin the journey to opening their own business. It will give you a few tips and tricks to help you start an effective business in a short amount of time.
Find Your Niche
There are hundreds of thousands of online businesses – this means that you have to carve out your own niche. You don’t want to be competing against large multi-national corporations unless you can offer something drastically different. If you already have a business idea, try and narrow it down to an approach that isn’t followed by other companies already operating in the industry.
There are a range of different online business industries that you can enter if you want a purely internet-based company. Below are some common online business themes – remember, you’ll want to add your own twist if you want to differentiate yourself.
While the retail space is dominated by large names such as Amazon, there’s still plenty of room for growth if you can specialize in a certain niche. For example, if you think you have a good eye for clothes, you can start selling vintage clothes online via an online store. You can connect your website with an eBay-based store to double your scope.
If you’re a freelancer, starting an online business can greatly increase your customer engagement. You’ll be able to find many more clients if you’re able to expand your reach across the country, or even the world. Join the thousands of freelancers that have made the move online. You can create a blog or website that displays your portfolio and other works – it’s a great way to expand your client base.
You may think of franchises as exclusively brick-and-mortar operations. But there are actually plenty of online franchises available to purchase through a variety of different brokers. At present, the largest online franchise broker is Franchise Direct – have a look at the different franchises they have available!
Focus on Core
Often, new business owners end up making mistakes by spreading their focus on too many variables. When you first start an online business, you should try and begin by pursuing a single product or service – or at least a single TYPE of product or service. Spreading your focus on too many components will mean that you may end up failing.
Leverage Social Media
Social media has become one of the largest advertising platforms in the world. Many small business owners continue to neglect social media as a legitimate way to connect with consumers – don’t fall into this trap. Social media offers you some of the most highly customizable market segmenting in the industry. You can pinpoint customers that will have interest in purchasing your products.
Use Appropriate Financing
Although costs associated with opening a small business are quite low, you’ll most likely need some form of financing if you want to expand your operations. Using finance is typically the easiest way to get funding for your business without having to sell off parts of your own equity stake. Below we will discuss three effective financing techniques you can use to start your online business.
Traditional Loan (SBA)
A traditional loan can sometimes be hard to obtain, but the Small Business Administration has made it easier to take out a term loan for business purposes. They back loans from private lenders – if you default on the loan, the federal government covers up to 85 percent of the value of the loan. This reduction in risk has made it much easier for lenders to provide money to small business owners.
This is a great form of finance for someone who knows exactly how much money they need. It carries low-interest, but the amount of money you borrow is set in stone – you’ll have to pay interest on it, even if you don’t use it.
Business Credit Card
A business credit card can help you pay for initial start-up costs, it also allows you to have a card facility to make payments. This is another popular option, but it comes at a higher price – interest rates are much higher on credit cards than personal loans.
Business lines of credit operate in a similar way to credit cards – you only have to pay interest on what you use. You’re assigned a spending limit, but you don’t have to tap into it if you don’t need to – it’s a great way to have some flexible cash on-hand. In addition, you don’t have to pay to get a cash advance. Credit cards charge large fees for cash withdrawals!
There has never been a better time to start an online business. As the world becomes more and more dependent on the internet for commerce, your opportunity to make a decent living via the internet increases. In addition, the barriers to entry are at an all-time low – free or affordable services can help you build online stores and websites for a relatively low cost. You no longer have to be a computer programmer to run a successful internet-based business.
Regardless of how you choose to start your online business, you need to make sure that you give yourself enough time to make the right decisions. The last thing you want to do is end up in a situation where you’ve rushed to judgement – it’s the easiest way to get burned.
Check out some of the other useful business-related articles we have posted on our site – we have a ton of great content!
William Anderson has been working with small business owners for the past 10 years. He got his start at an investment bank, but felt that he was too detached from where real people were making decisions that affected local economies. As a result, he took his experience and his MBA degree to work helping local small businesses.