Complete guide to starting an online business
The rise in rent fees has made online businesses much more attractive to entrepreneurs, most especially small businesses. Coupled with the fact that setting up a website is quite easy and cheap, many startup small businesses do not even consider the option of renting an office space or store before taking to the web.
A team of experts will get you the answers you need to get started with your business.
Peradventure you are wondering what kind of business you can do online or need ideas on how to even go about it; you have come to the right place. We have put together in this article some information that will be of help in your business endeavor.
Reasons for starting an online business
There are many reasons why starting an online business may be the best option for your business in the UK
- With the rise in e-commerce, more people prefer to order their goods including groceries online these days. What that means is that it will be in your best interest to open up an online store where people can easily browse through your wares and make their orders. Convenient right? This is what online stores like Amazon, Ali Express, and the likes are doing and they are cashing out big.
- It is more convenient than opening and managing an actual physical store or office. If you are tech-savvy, you can set up the website and manage it by yourself. If you are not, you can easily just employ someone to do it for you.
- It costs less to open an online business. Think about all the physical equipment and personnel you’ll need to even get the business started. Whereas, opening an online business may mean you can do it all on your own, especially if what you are selling or the services you are providing is not elaborate. It sure beats hiring or store manager, receptionist, accountant, storekeeper, and/or any other related workers which will cost your business more. This is more reason why many small businesses opt to be online businesses only.
- People can order your goods and services even when you are not online. Your business can run 24/7 and you make more sales.
- Work at your convenience. Since you’ll probably do more of your business online, starting an online business is a good way to work only at your convenience.
How to start an online business: step by step
1. Create a business plan.
Much like any other business out there, creating a business plan is also important for an online business. This will give you a sense of purpose and direction. It will also serve as a guide for achievable milestones. A well-organized business plan can also help you attract the right investors and/or partners.
When you have a good business plan, your credit union or bank sees how serious you are and can give you a loan to jump-start your online business. All in all, creating a business plan is the first step to take, whether you are starting an online business or not.
2. Do a market survey.
As rigorous as this may sound, it is a very important step for an online business. You must check through the web to know your potential competitors. Find out what they are doing to garner more sales, other things they are doing that you can improve on, and develop a strategy to make your online store unique (which is the main purpose of a market survey.
A good market survey will also give you an idea of financial projections for your business which is good for your business plan.
3. Choose a business name.
Choosing a business name is important for the identity of your business and registration with the UK government. Be aware that your business name must be unique and not offensive or suggestive. Be creative with it.
4. Choose a business structure.
Four business structures are applicable in the UK: sole trader, business partnership, limited liability company, and limited liability partnership. These four have different variants of each and you can make a choice of which category your business falls into.
Bear in mind that each of these has its pros and cons which should be adequately considered before settling on a choice. However, you must know that it is better to start small, say a sole trader or business partnership, and then scale up to a limited liability company as your business grows.
5. Register your business with HMRC or Companies House as it applies to your business type.
The sole trader and business partnership need only to register with the HMRC for Self-Assessment to pay personal income tax. The limited liability partnership and limited liability company must be incorporated with the Companies House and registered with the HMRC to pay corporation tax.
Registering with the government gives you certain benefits like evidence of self-employment as well as benefiting from the Class 2 National Insurance scheme. In addition, you will be eligible for government-sponsored palliatives or aid for businesses in case of a pandemic or any other natural disaster like COVID-19.
6. Open a business bank account.
Having a separate bank account for your business is quite important for many reasons. One of such is that it makes accounting easier and not mixed up with your personal income and transactions. This is important for documentation to pay tax appropriately.
7. Create a website or online store.
Creating a website or online store can be easy but has many sides to it. We have highlighted some basic things that must be done to ensure your website is up and running smoothly.
- Choose a web host. Most websites out there are hosted on other platforms because hosting your own website requires more than just being tech-savvy; you must know how to code and that requires special training. Also keep in mind that while most web hosts give you the option of creating your website for free, it is not advisable. This is because there are too many web options that will not be available to you and websites created for free are easily attacked by hackers. You are going to be earning money from your website, make up your mind to spend a reasonable amount to build it.
- Choose a CMS (Content Management System). WordPress and Wix are CMSs that easily come to mind. They allow you to create customized pages without having to know how to code or program.
- Design and customize your website. Your color scheme must match the archetype of your intended clients and also the type of business you are doing. Also, like most designs, simple is always best. Nobody likes an endless navigating system that would make their first-time experience on your website tedious. In other words, a toddler should be able to navigate your website easily.
- Don’t forget to add a payment gateway. After all, the main reason you are creating an online store is to allow people to browse through your wares, make a choice and buy. For this, you will need a merchant account from your bank or third-party hosts like PayPal. This merchant account will hold payments from your clients’ debit and credit cards and pay into your business account later.
- Drive traffic to your site. You can do this by advertisement and creating SEO-rich contents to bring your site to the view of your potential customers.
8. Create a social media marketing plan and execute it.
As you already know, social media is a great tool in business advertisements. Some people don’t even build a website until they have built a well-established social media presence on Instagram, Facebook, TikTok, etc. Some even use their WhatsApp.
If you are not well-versed in the ways of social media, you can as well hire a social media manager for the purpose.
Also, think about using social media influencers to advertise your business.
9. Advertise your business.
Advertising your business cannot be overemphasized and this is closely related to the last point we made. You can either do this on social media or any other website. A very good example is Google ads. When you use this option, your business is tailored and advertised to any potential client of yours who uses the web. You can also opt to use email marketing by either sending out cold emails or sending emails to earlier clients to inform them about new stocks.
Examples of online businesses
You may be wondering if your business type is worth setting up an online station for. Here are some examples of online businesses out there (but not limited to these only, the trick is to be creative) –
- Online stores – good for selling all kinds of goods ranging from fresh organic groceries to fashion items and any other goods you can think of.
- Dropshipping – you can retail for other businesses and still make your money especially when you have reliable suppliers.
- Warehousing and wholesaling – almost related to dropshipping but you have a physical store where the goods are stored.
- Services – whether you are a writer, accountant, lawyer, investment broker, language tutor, etc., you can open an online business to provide professional services to people and get paid.
How to start a small business online?
1. Identify a viable business and make a plan
Do a market survey and get the right information for your business niche
A team of experts will get you the answers you need to get started with your business.