Fundamentals of Starting an Online Business

Online Business

Starting an online business can be an exciting and fulfilling process. Yet, it is also a time-consuming endeavor, which might not be as difficult as one assumes. Making money online and/or working from home can be quite rewarding and potentially lucrative. Yet, there are several things to consider and address in order to make an online business successful. That being said, here are some fundamentals to know and understand about starting an online business.

Many individuals venture into making money from home as a form of residual income. They are looking for ways to supplement their income and/or generate multiple income streams. In this ever-evolving technological age, making money online has never been easier and work-from-home opportunities have never been more prolific. One of the biggest hurdles to overcome is securing legitimate money-making options, which will yield reliable residual income and will not land investors in hot water. This aspect can be a challenge, however, the potential profit from a successful online business endeavor can be well worth the risk. Yet, it is recommended that burgeoning entrepreneurs do their research and proceed with caution.

The fact is, there are many scams out there, especially in the cyber world. There are online predators–financial and otherwise–who are looking to take advantage of people. In most cases, they do not care who their victims are or what their circumstances might entail. These scam artists are simply out to make a buck. Unfortunately, it is at other people’s expense. Whether it is for a few dollars or significant windfall, they are trying to get as much money out of their potential victims as possible. These opportunists are present all over the Internet. They consider it their own form of online business. As a result, those seeking online ventures and/or money-making opportunities must be prepared, walk into the situation with eyes wide open, and investigate their options thoroughly. This warning is especially poignant for those fortune seekers with little start-up capital who are hoping for a big payoff. In these narrow margin scenarios, investors can hope for the best but should be prepared for the worst.

Typically, e-commerce is one form of online business that is reliable and rewarding. This would include selling on websites, such as eBay, Amazon, Craigslist, Etsy, etc. There are many advantages to online businesses like these. First, these websites are well-established and known entities. Second, they have clearly defined user policies. Third, they have built-in traffic streams and advertising. While many of these sites require seller fees and take a commission on sales, the fact that they are so well-known on a global scale and deliver reliable traffic to sellers looking to generate income often negates these considerations. For many sellers, the positives far outweigh the negatives. This is especially true for those exploring an online business as a sideline or looking to test the waters before venturing into a full-time online business and/or commitment. Moreover, many potential entrepreneurs want to know they can make a living with an online business before sinking their resources into it, especially if they have limited resources to invest. Furthermore, starting an online e-commerce business is very simple and often involves limited risk.

A prime example of an easy e-commerce start-up would be selling on websites, such as eBay or Amazon. If someone has ever purchased anything on eBay or Amazon as a buyer, it is quite easy to establish a seller account on these sites, as well. Moreover, if a seller is successful in these venues, they might opt to upgrade to their own seller store and/or professional seller status on these sites. Of course, there are exceptions and/or restrictions that might complicate matters. If an individual has proven to be a difficult or dishonest customer with several claims filed against them as a buyer, or they have tried to take advantage of a seller and/or the site in general, the company may choose to restrict or deny selling privileges to them. Furthermore, not every buyer or seller qualifies for upgrades. If they do, an invitation is usually sent from the company.

Online Business

Another consideration is that sellers on these sites must provide a deposit method for funds from sales and a chargeback method if claims are filed against them. This usually involves linking a bank account, credit card, and/or PayPal account to their seller account. If someone does not possess any of these accounts, selling privileges on these websites will not be authorized. Moreover, many believe they can circumvent these requirements via the use of prepaid cards. This is rarely the case. Most of these sites have fine-tuned verification procedures and explicit guidelines that rule out prepaid card options. Nonetheless, potential sellers should always thoroughly review seller guidelines and procedures for sites before joining up, so they know what is required and expected from them, as well as any potential pitfalls that might negatively impact them.

Another aspect of understanding the fundamentals of starting an online business is that these opportunities can be risky and expensive, especially when securing a domain, designing a website, and promoting a business via advertising. These start-up costs can be much more significant than anyone anticipates. That is why many entrepreneurs opt to become third-party sellers with established websites, such as Amazon, eBay, Craigslist, etc. This is because doing so eliminates many of the associated costs and risks inherent in online businesses. Sellers on these sites can generate extra income and explore the e-commerce world with little risk or upfront investment. Additionally, they can learn about selling online, the nature of cyberspace, and test the market for what goods are selling well. Sellers can learn about the possible risks and rewards involved in cyber sales prior to venturing out on their own. Moreover, both eBay and Amazon offer frequent selling tutorials and regular newsletters for sellers. Furthermore, all of these aids are online-based, therefore, they can be accessed remotely from anywhere as long as someone has computer and Internet access or some other mobile device with connectivity abilities.

Another low-cost, limited risk option for starting an online business might include a blog. Blogs are easy to maintain and can be opened on WordPress. Anyone who has a WordPress account could establish a blog of their own. Moreover, there is usually limited start-up costs associated with a blog. Namely, the costs would be attributed to advertising, site design, and/or domain name if deemed necessary. These venues are cheap and require little maintenance in most cases, but they can become pricey if bloggers start out too big or infringement issues are raised. Therefore, wannabe bloggers need to do their research and be prepared for potential pitfalls as every entrepreneur should do before starting any online business.

While starting an online business can be a very rewarding and potentially lucrative endeavor, there are several fundamentals to consider and address in order to make an online business successful. It is rarely as difficult as one might assume to get started, however, potential investors must do their research ahead of time and educate themselves about potential pitfalls as every entrepreneur should do before starting any online business. Making money online and/or working from home can be incredibly fulfilling and profitable, but there are some fundamentals that every investor should know and understand about starting an online business.

Opinion Written and Edited by Leigh Haugh

Personal Experiences and Opinions of the Author
Entrepreneur–How to Start a Business Online
United States Small Business Administration–Online Businesses
Bplans–4 Steps to Starting an Online Business
Forbes–Twenty Businesses You Can Start Tomorrow
Featured Image Courtesy of Daveybot’s Flickr Page – Creative Commons License
Top Article and Inline Images Courtesy of WikiMedia Commons – Creative Commons License

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