If you want to be your own boss and you have a great idea for a marketable product or service, starting your own e-business might be the right call. But what do you do first? And how can you improve your odds of success? This wikiHow article answers several questions like these, so read on to see if e-business is the right business for you!
[Edit]Steps
[Edit]How do I get started?
- Research eBusiness models and strategies before you dive in. Yes, you can easily put items up for sale on eBay or Etsy and run a no-frills eBusiness in no time. If your goal is to create a sustainable, scalable eBusiness, however, it pays to do your homework first! Get a clear idea of what you want to sell, then look into the most efficient and profitable ways to make, sell, and deliver your products or services. Some basic questions to ask yourself include:[1]
- Do I want to focus on one or a few products/services or offer a wider range?
- Do I want to create my own eStore or sell through existing retailers?
- Do I want to produce and ship what I sell or run a drop shipping business?
- Who are my customers? My competitors?
- Do I want this to be a side job or grow into something bigger?
- Which business model(s) suit my plans and goals?
[Edit]What eBusiness models are there?
- The 4 basic models include B2C, B2B, C2C, and C2B. The Business-to-Consumer (B2C) model is the most similar to the typical brick-and-mortar business model: your eBusiness sells your products or services directly to your consumers. But many successful e-business operate on one or more of the other 3 models, so they’re definitely worth considering:[2]
- Business-to-Business (B2B): Your business sells your products or services to other businesses, which (in most cases) turn around and sell them to consumers.
- Consumer-to-Consumer (C2C): In this case, you are both buyer and seller in interactions with other buyers/sellers, most commonly on intermediary sites like eBay or Craigslist.
- Consumer-to-Business (C2B): This typically refers to influencers on sites like YouTube or Instagram. As the influencer/consumer, you market your connections to your audience (followers/subscribers) to businesses.
[Edit]What should I sell?
- Consider selling niche products that interested customers will seek out. Avoid trying to compete directly against eBusiness giants by selling a wide range of products. Instead, focus on selling handmade or niche products that draw in customers looking for those specific things. This is a great way to start small but leave yourself avenues for expansion over time.[3]
- For example, say you’re skilled at crafting miniature figurines and decor. Instead of trying to market a wide array of items related to this field, consider setting up a shop on Etsy that sells miniature decor for fairy gardens!
- While it’s fun to dream of coming up with the “next big thing” that makes you an eBusiness titan, focus first on marketing the talents, interests, and products or services you have right now.
- Look into marketing your own expertise instead of selling stuff. You might be your own best business idea! For example, if you have skills in web design or search engine optimization (SEO), you can market those skills to businesses. Or, you might offer services as a tutor, technical writer, resume writer, small business consultant, or social media consultant on freelancer sites such as Guru.[4]
[Edit]What can I do to attract customers?
- Make it easy for them to find, buy, repeat buy, and tout what you sell. Many traditional business strategies, like coupons and loyalty programs, also work well for e-businesses. That said, it’s important to adapt the strategies you use so that they suit your eBusiness model. Overall, aim to make the customer experience as easy and seamless as possible with strategies like the following:[5]
- Highlighting new or especially relevant products.
- Offering convenient and secure payment options.
- Offering coupons and other discounts.
- Setting up a customer loyalty program.
- Providing free or discounted shipping and returns.
- Highlighting positive customer reviews.
[Edit]How do I write a business plan?
- Draw up well-researched summaries of your current situation and future goals. Spend some time looking over reliable online articles that provide tips and templates for writing a business plan, especially for an online business. Then, take some more time to research, analyze, and just plain think about your business—as it is today and what you plan for it to become. While there’s some room for variations, good business plans often contain the following sections:[6]
- Executive summary: a one-page summary of your overall vision for the business. Put this first but write it last.
- General company description: a quick overview of your business.
- Products and services: a detailed description of what your business offers.
- Marketing plan: a concrete description of how you’ll reach your customers.
- Operational plan: an overview of your business’ day-to-day operations.
- Management and organization: a nuts-and-bolts breakdown of your business’ structure.
- Financial plan: a clear breakdown of your current situation and future needs.
[Edit]Do I need to be highly tech savvy?
- Not really—you can get by with just a computer and some basic web skills. If you have the tech skills to shop on sites like Amazon and Etsy, you can handle setting up a seller site on them as well. Likewise, there are a wide range of affordable web hosting platforms (such as Dreamhost and SiteGround) that make it easy to set up your own eBusiness website.[7] Or, if you have the funds, you might decide to just purchase an existing eBusiness operation![8]
- Sure, you can build your eBusiness operation from the ground up, website and all, if you have those skills. However, you’ll likely find it’s worth your time and money to hire freelancers to handle areas like graphic design, coding, search engine development, content creation, and so on.
[Edit]How much does it cost?
- Startup costs can range from a few hundred to thousands of dollars monthly. It’s not very satisfying to answer this question with “it depends”—but unfortunately it’s the truth! If you run a solo operation, build a small website for free on an option like WordPress, and either provide services or use drop-shipping for products, your costs may be extremely low. However, if you build a ground-up site, pay vendors for services like marketing and payment processing, and hire any employees, your startup costs can increase rapidly.[9]
- Consider “testing the waters” with a less expensive setup instead of going all-in right from the start. See if there’s a market for what you’re selling and room for growth.
[Edit]Do I need to form an LLC?
- Not if you’re a sole proprietor, but you might want to form one regardless. In the U.S. at least, forming a limited liability company (LLC) adds some more government red tape to your operations, but also offers greater liability protection for your personal assets (as opposed to the LLC’s assets). While laws vary by state in the U.S., you’ll probably have to form an LLC if your business includes any additional members or managers. Check the website for the Secretary of State in your state to get details on the registration process and related requirements.[10]
- If you don’t have any co-members or managers, you can usually operate your business as a sole proprietorship. You’ll save some money, and some time on paperwork, but this also means that your personal assets are exposed to liability for your business. So it may make sense to form an LLC right from the start, especially if you plan to grow your business.
- The rules and terminology are probably different if you’re outside the U.S. Inquire with your relevant government agency or consult with a business attorney.
[Edit]Are eBusinesses profitable?
- They can be, especially if you limit your competitors by finding your niche. While eBusiness competition—from both big and small players—can be fierce, you may find a path to profit by exploiting gaps in the market. If you sell products or services that customers are willing and able to seek out, and provide an exceptional customer experience, you’ll have a better chance of achieving profitability.[11]
- Somewhere around 80%-90% of eBusinesses fail within around 4-6 months, which is higher than the failure rate for brick-and-mortar businesses. This doesn’t mean you should immediately give up your dream of building a successful and profitable eBusiness; but it does mean you should accept the challenge with your eyes wide open.[12]
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[Edit]References
- ↑ https://www.nerdwallet.com/article/small-business/how-to-start-an-ecommerce-business
- ↑ https://yourbusiness.azcentral.com/explain-business-consumer-model-15793.html
- ↑ https://www.businessnewsdaily.com/4572-online-business-ideas.html
- ↑ https://www.businessnewsdaily.com/4572-online-business-ideas.html
- ↑ https://www.fool.com/the-blueprint/ecommerce-strategies/
- ↑ https://www.entrepreneur.com/article/247575
- ↑ https://www.cnet.com/news/best-web-hosting/
- ↑ https://www.forbes.com/sites/nextavenue/2017/12/10/8-ways-to-start-or-buy-an-e-commerce-business-in-midlife/?sh=ce4e2ed227d4
- ↑ https://www.forbes.com/sites/nextavenue/2017/12/10/8-ways-to-start-or-buy-an-e-commerce-business-in-midlife/?sh=ce4e2ed227d4
- ↑ https://smallbusiness.chron.com/llc-vs-sole-proprietor-online-retail-business-2129.html
- ↑ https://www.forbes.com/sites/jasongoldberg/2019/08/14/four-reasons-profits-remain-elusive-for-e-commerce-retailers/?sh=2e1b36f91b5e
- ↑ https://smallbiztrends.com/2019/07/why-ecommerce-fails.html
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