10+ Steps On How To Start An Online Business That Actually Works!

1. Have a Business Great Strategy

A business strategy is an inter-organizational documented plan about how a business is going to achieve its goal. The goal can be about reaching 1 million users, fulfilling customers’ needs & expectations, creating a niche for yourself, or being better than your competitors. This is an important and foremost thing before you go about starting an online business, as not only it gives you a concrete path to walk on but also helps you trace your success, performance, or areas of improvement against the target you’ve set in your business strategy. It can have these points or many more:

• Executive Summary
• Business Description
• Market Analysis and Competition
• The Product or Service
• Marketing and Sales Plan
• Ownership, Management, and Personnel
• Financial Plan and Projections
• Investment

2. Choose Your Business Structure

When starting an online business, make sure you’ve the type of legal structure of your company. As this not only influences on how much you pay in taxes or the legal formalities you’ve to file for or take licenses, but the amount of investment you need to make or even the possibility of raising profit also depends on it. Here are a few of the major business structures that you can choose from:

A. Sole Proprietorship

The businesses which are owned by one person who runs the business on his own.

Advantages of having a sole proprietorship while starting an online business.

• The owner receives all the profits
• Profits are taxed only once
• The owner makes all decisions and is in complete control of the company
• Easiest and least expensive form of ownership to organize

Disadvantages of having a sole proprietorship while starting an online business.

• Unlimited liability if anything happens in the business. Your personal assets are at risk
• Limited in raising funds and may have to acquire consumer loans
• No separate legal status

B. Partnerships

It's a type of business where two or more people share the ownership of a single business along with how they’ll share the profits, liabilities and assets and how disputes, if any, will be resolved or how the partnership will be dissolved as outlined by a legal document.

Advantages of Partnership while starting an online business.

• Easy to establish (with the exception of developing a partnership agreement)
• Separate legal status to give liability protection
• Profits are taxed only once
• Partners may have complementary skills

Disadvantages of Partnership while starting an online business.

• Partners are jointly and individually liable for the actions of the other partners
• Profits must be shared with the partners
• Divided decision making
• Businesses can suffer if a detailed partnership agreement is not in place

C. Corporations

A business that is in the eyes of law is seen as a unique entity, separate from the people who own it. There are three types of corporations: C-corporation, S-corporation and Limited Liability Company.

C-corporation: It is taxed separately from its owners and allows a limited liability to the owners and thus more risk-taking and potential investment.

Advantages of C-corporation business model while starting an online business.

• Limited liability
• Transfer of ownership, shareholders can sell their shares
• Capital is easier to raise through the sale of stock
• Company paid fringe benefits
• Tax benefits

Disadvantages of C-corporation business model while starting an online business.

• Double taxation (corporation and shareholder earnings taxed)
• Can be costly to form
• More administrative duties - required by law to have annual meetings, notify stockholders of the meeting, must keep minutes of meetings and turn in
• Pay corporate taxes at a different time than other forms of business

S-Corporation: Also known as subchapter S-corporation, gives limited liability to the owners as it does not pay income taxes and the earnings and profits are treated as distributions. Shareholders involved in this corporation must report their income on their individual income tax returns.

Advantages of S-corporation business model while starting an online business.

• Limited liability
• Avoids double taxation
• Profits taxed only once
• Capital is easier to raise through the sale of stock
• Transfer of ownership

Disadvantages of S-corporation business model while starting an online business.

• Can be costly to form
• Stockholders limited to individuals, estates or trustees
• Required administrative duties
• Cannot provide company paid fringe benefits

Limited Liability Company

This type of business is a mix of structure that provides the limited legal liability of a corporation and along with the operational flexibility of a partnership or sole proprietorship. This requires you to file paperwork.

Advantages of a Limited liability company while starting an online business.

• Most common business structure and specifically created for small businesses
• Must have insurance in case of a suit
• Separate legal entity
• Usually taxed as a sole proprietorship
• Unlimited number of owners

Disadvantages of a Limited liability company while starting an online business.

• Can be costly to form
• Yearly administrative costs
• Personal tax liability
• Legal and accounting assistance is recommended

Remember whatever the business structure you decide to go for always base your choices on three main factors: liability, taxation and record-keeping.

3. Choose Online Business Model

After deciding upon the type of business you will start an online business with, now is the time to choose the kind of online business model you want to go for. Here’s the list of one of the six popular online businesses to choose from:

Here are six types of online businesses to consider:

• Freelancing: You can offer your service to other individuals and businesses using a skill that you have like content writing, designing, or photography.
• Coaching and Consulting: Become a coach or a consultant and sell your expertise, advice, and guidance.
• Software as a Service (SaaS): Create a piece of software or application, and charge users a recurring subscription fee.
• Ecommerce: Using platforms like Magento, Shopify or BigCommerce, set up a website and sell products online.
• App Developer or Builder: With knowledge of coding & basic elements of software design, build apps for businesses that need specific apps.
• Virtual Assistant:  Help businesses or entrepreneurs organize their personal or professional lives like setting appointments or marketing management but virtually!

4. Analyze Your Potential Competitors

This is one of the most crucial steps while learning how to start an online business. Familiarize yourself with the market you want to step in. A competitor analysis is important because it will not only ensure you can enhance your own business goal after considering market trends but it will do more. It helps you identify how you can create a better business strategy than your competitors and much more. It can also provide you insights into your own best practices, business growth plan and its potential flaws thus a chance to outgrow not only your competitors but also your own goals.

5. Identify Your Target Market & Study Their Preferences

An effective business strategy helps you stay on track to your success path, similarly identifying a target market helps employ better communication strategies whether products, marketing, or services. Additionally, when you know who you are selling your product or services particularly, it helps you organize the group in a cost-effective and time-effective manner. So figure the gaps in the needs of your customers and fill it via in-depth market research or exploring industry trends, reviews. The target market is exactly those potential buyers that have higher chances to get engaged with your business and will definitely lead to business growth.

6. Decide a Relevant & Effective Brand Name/Logo

Do you know Facebook was initially known as TheFacebook? But it lost “THE” and renamed itself to just Facebook. What do you think is catchier “TheFacebook” or “Facebook”? You have invested a lot in your business idea whether money, time, or effort, however, if you can’t give it a name that not only distinguishes your business from others but also an image that is etched in the mind of your customers forever. Then what’s the point? So go for names that:

• Related to your business messaging/branding
• Give insights into what your business does or sells
• Are scalable to suit your future growth plan
• Develop Your Visual Identity via Logos

7. Perform The Legalities

Since you are learning how to start an online business, and will certainly going to start an online business, you must understand the importance of legalities. Before you start an online business you do need to seek and file appropriate business-formation paperwork, permits, and licenses to perform your particular business activity. For instance, Payment Card Industry Data Security Standard (PCI DSS) is one of the major documents that you need for involvement in any kind of online financial transaction. Other than that following are a few other legal formalities that you need to do to give your online business a solid legal foundation:

• Registering your business with the appropriate government authorities
• Obtaining all the required permits and licenses
• Meeting all federal and state tax requirements, such as applying for state and federal tax ID numbers
• Ensuring your business name, services or products are registered for Trademark so that your brand name is protected from getting copied or used without your authorization.

8. Choose The Right Website/Sales Platforms

There are several website platforms that you can pick for your online business but you need to make a sound decision considering your website is the first impression that you give to your potential customers. Based upon how your website looks and functions, they will form an opinion about your business, so make sure to choose the best platform that ensures to develop a responsive enticing website with all advanced and required features & functionalities. So, go for websites or designs that:

• Simpler or Easier learning curve
• It is fast and secure
• Mobile-responsive
• Simple & intuitive to explore
• Persuasive Call to Action
• Cost-Effective Maintenance support
• High on Customization

9. Build Brand Strategy That Forter Growth

Having a brand strategy is all about shaping your existing and potential customers' perspectives about your products, services, and overall company image and that depends on how you communicate with them. Brand strategy isn’t a complex matter but is quite important as:

• It helps you in creating a different and distinct image than your competition and gives you visibility in the marketplace
• It’s the stepping stone to marketing strategy as it provides a clear purpose for how you can engage your customer and why you are doing so
• With a consistent, clear, and cohesive brand strategy, you can attract new customers & retain loyal customers 
• It also gives your own employees a clear brand vision to ensure that everyone is working towards the same goals
• It increases your business value as a strongly established brand not only adds value to your brand for future revenue generation but also makes you an attractive choice for an investment opportunity

These are some of the major branding key elements:

• Brand Purpose
• Brand Vision
• Brand Values
• Target Audience
• Market Analysis
• Awareness Goals
• Brand Personality
• Brand Voice

Wanna learn how you can position your brand well amongst your competitors? Ring JanBask Website Development Services to know the most cost-effective and compelling way! 

10. Create A Solid Digital Marketing Plan

Digital marketing for online business just like branding is an essential step to start an online business and to attract more customers, convert leads into sales and for brand awareness via digital channels like search engines, email marketing, and social media. Since you want to learn, how to start a profitable online business digital marketing is something that can help you the best. Other benefits include:

• Interact with your prospects and learn exactly what they are looking for
• Reach a global marketplace instantly
• Cost-effective and makes quiet easy to reach more customers than traditional marketing methods
• Create brand loyalty by knowing your audience and letting them know you intimately
• Track what is working for you and what is not and improve based on it
• Evaluate the progress of your marketing efforts immediately

Some of the key elements of a Digital Marketing Plan:

• Online Advertising
• Content Marketing
• Downloadable Content Offerings (eBooks, Whitepapers, Webinars)
• Buyer Personas
• Email Marketing
• Video Marketing
• Social Media Marketing
• Search Engine Optimization (SEO)
• Pay-Per-Click (PPC) Marketing

1. Analyze Your Past Reports/Progress

Take out your past progress reports and analyze them thoroughly to understand where you fall short. Sometimes we do have well-documented progress reports but we rarely give them a chance to analyze the performance and overall growth of the business. Not doing so leads to you missing the areas where you can improve for better opportunities and growth. Once you are done with that, nobody can stop you to make your business more profitable.

2. Re-design/Redevelop an Easy-to-use Website

A great website won’t just create your online presence or help you sell your products or services, it also leverages to help you achieve your business goals and keep you ahead of your competition. But a poor web design or an outdated website is going to do your business more harm than good. Everything is turning digital these days. So, if your website doesn’t provide a great user experience, user-friendly content, and website design then you won’t only lose your new visitors but also fail to retain old ones.

Seek professional help for redeveloping or redesigning your existing website, expert advice from a website design agency will make your website not only perform well for you but also give your customers a greater user experience and loyalty!

The Pros Of Starting An Online Business

1. Be Your Own Boss

If you’ve a business idea that you want to see go live in the digital world one of the positive aspects to running your own start-up or small business is that not only you’re not restricted to office timings but you’re your own boss. You can work around your own schedule, need, and requirement without having to be worried about your manager or seniors haunting you. You can simply spread the word throughout the day and enjoy the work you do at your own pace.

2. Low Overhead Costs 

These days anyone can start a business online. You can start a business even from your sofa simply because you don't need to get funding for a brick-and-mortar space or additional electricity or signage, or anything like that. For instance, to start an online retail store your products and marketing will most likely be your main expenses. Even if you’ve an online business that offers a particular service, you're essentially spending nothing on expenses except your website domain and maintenance.

3. 24/7 Income Stream

Yes, the revenue stream while running an online business is 24/7. As most offline stores are usually operational for some 12-13 hours but by being available at all hours and days, you can attract people to your store and buy your services or products who would normally pick up a product in stores if the outlet were open. However, that doesn’t mean you’ve to stay awake 24/7 especially for customers who usually order at night. Why? Because to accommodate their requests at odd hours you can simply automate your ordering systems so that customers receive a confirmation email when they place their order to give them peace of mind and your profit.

4. Greater Exposure & Branding

The online world is huge and most of the time, kind. If you’ve an online business, you get the opportunity to reach many new customers on the internet across the world in an instant, something you miss when you’ve an offline business. Plus, today’s world runs on clicks and shares, it is way easier for customers to find you online than on Google Maps and if they like what you offer, expect shares and likes in 5, 6 or 7 figures! 

5. Customization/Evaluation is Easy

With so much customer data regarding their likes, dislikes, buying history, or behavior, you can easily tweak your services or products or designs to their likings and interest. With unlimited access to tools and technologies, you can not only give your customers a seamless and smooth user experience but can also trace your progress in terms of sales, conversion rates, or bounce rates to stay connected with your customers online and be relevant.

The Cons Of Starting An Online Business

1. Security and Fraud

Unforeseen circumstances that result in loss can happen whether you run an online business or an offline one. However, with online businesses there’s a big chance of different kinds of theft: data, privacy, or fraud, that’s why cybercrime has been the biggest hurdle not only for emerging business owners but also for customers that feel buying online is a risky option. 

But worry not if there are chances of cyber threats and fraud then there are a million ways to avoid them. Integrate the latest security systems, secure payment gateways, and keep a regular backup and software updation of your website and you’re good to go!

2. More Competition

Online business is rising exponentially and so is the competition. Nowadays you can find everything online be it food, movies, clothes, medicines, or even education, today’s customers are spoilt for choices. If they don’t find one thing at one online store they’ll quickly move to another, so you’re always in need of measures and features to stay ahead of your competition and that can be a daunting task if you’re a start-up or small business who just started. 

If you feel your business idea is unique, we believe there’s really nothing that you won’t do that helps you in maintaining an edge over your competition. So don’t be disheartened by the competition yet, believe in your business idea, listen to your customers and offer them the best, secure, and smooth buying journey and they’ll keep coming to you.

3. Website Costs and Technical Issues

Follow these steps to start an online business from scratch and anyone can have their own online business either free or with some meager investment. But you still can go wrong with your site when it comes to basic tech know-how if you’re a non-IT guy. In that case, you need professionals who can give a  smooth and highly-functional website. This will surely add to your business cost, additionally securing your site or hosting costs is an extra cost you need to incur with an online business. 

However, steps to start online business or running an online business might seem an expensive option for all these reasons but there are so many cost-effective service providers for online business website design & development that helps you run your website smoothly, safely, and economically. They make it easier for you to focus on running your online business while they take care of your website for you.