Whether you’re looking to quit your day job or you’re unemployed and considering new income options, now that virtually everyone has access to high speed internet providers, there are plenty of ways to start an online business. The biggest mistake that people make is to go into the experience without enough preparation.
The first step is to decide what type of business you want to start. There are two things that should be carefully considered: what you’re qualified for and what there is a need for. If you start a business selling ceiling tiles, but know nothing about the industry, you’re not likely to be in business very long. Likewise, if you’re an expert on an outdated technology, no matter how excellent your qualifications are, there is likely not to be a market for that skill.
Once you’ve identified the niche that you’re most interested in, it’s time to think about start up costs. Some online businesses can have a significant start up cost, specifically if you are selling or creating an expensive product. Take the time to carefully outline all potential costs, including materials, shipping, advertising, web space and anything else that might come up along the way.
Other online businesses will seem to have little to no start up costs. For example, if you’ve always wanted to become a writer, you can market your skills and look for work online without paying a cent to do so. However, there will still be costs to take into consideration. One of the most important costs will be the costs of your internet. Keep in mind that a slow connection can not only increase the amount of time it takes you to do the same amount of work, but can lead to missing out on important opportunities.
Many new online business owners benefit from wireless internet. This technology allows them to always be connected, as long as they’re in their coverage area. Those who use this type of connection can take a lunch meeting, go visit a friend or hang out in a coffee shop without worrying that they’re missing an urgent email from a client or customer.
When you’ve got your budget down and you’re ready to take the plunge, your next challenge is getting the word out there. The good news is that there are now many ways to reach your target audience for free. Take advantage of social media options like Facebook, Twitter and free blogs like WordPress. Stay active on them every day and provide valuable, unique information about the services you provide. Potential buyers or clients will be more likely to work with an online business who has a media presence.
As your business begins to take off, you’ll have several tough decisions to make down the road. One of the most challenging is when to quit your day job. The truth is that in order to build a strong, full-time online business, you must devote yourself to it full-time. On the other hand, most companies are not profitable immediately and you do have bills to pay – both personal and for your business.
The general rule of thumb is that a business takes approximately 6 months to become profitable and that a business owner should always have enough money in savings to cover 3 months of expenses. This includes expenses both for you personally and for your business. Once you are profitable and you have a cushion to fall back on, it’s time to quit your day job and devote yourself to your online business full time.
Another tough decision is when to bring employees into your business. In the beginning you want to maximize profits but there comes a point when spending money on an employee or two will mean a larger reward in the future. In the short term though, adding extra costs can be crippling to your business. The solution is to hire online contractors. You’ll have the benefit of being able to hire people from all over the world and will only pay them for exactly what you need. For example, if you need help writing product descriptions, you can hire someone who charges a flat fee per description. If you need someone to help with bookkeeping, you can find someone with 20 years of experience to work at an affordable hourly fee.
Finally, as you work on building your online business, remember that it’s up to you to keep accurate and secure documents. Every time you pay for anything that is related to your business, keep the receipt. You may be surprised to know how much you can deduct from your personal tax return. Many things can be deducted if you run your business from home, including a portion of your rent or mortgage, your electrical bill and the cost of satellite internet or other high speed internet.