Taking advantage of the exponential growth of e-commerce, an increasing number of online-only businesses have emerged over the past several years. While they’re are more common place than ever, a number of myths persist among people seeking to launch a business that exists solely on the internet.
To ensure determined online business hopefuls know what they’re in for and are in a strong position to develop sustainable operations, here’s a healthy dose of reality:
Myth 1: you can start an online business for free
It’s amazing how many people believe that you can really start an online business at no cost at all. Yes, starting an online business can be done for a very reasonable cost, you’re not going to start one for free. There’s a cost for purchasing your website domain, and additional costs for the website to be set up properly. There are fees for the permits and licenses that most areas require in order for someone to operate a business, even if that business doesn’t have a physical storefront. Don’t believe anyone who tells you that you can be a business owner for free.
Myth 2: starting an online business takes lots of money
This is the flip side of Myth 1. With a few exceptions, most online businesses do not require vast amounts of money to get up and running. There are a number of ways to purchase reasonably priced website domains, and there are plenty of ready-made tools available to launch a website. It’s fairly easy to get an online business up and going for less than $1,000.
Myth 3: you can keep your full-time job
Don’t even think about it. It’s impossible to both work full-time and devote enough time to a fledgling new business. There just aren’t enough hours in the day to handle both. However, it’s a very good idea to set up a transition time between the two, while you get your new business started. You can do this by continuing to work full-time and devoting a lesser amount of time to your business, or by cutting back on your regular job hours to devote more time to the new business. Build up your savings before you open your business, and that will allow you to devote more time to getting started.
Myth 4: online business owners have part-time hours with full-time wages
In a word, no. Regardless of the type of business you have, you will have to devote a lot of time to ensure its success, often more time than is required of an employee. It’s not unusual for an entrepreneur to spend 60-80 hours working each week, even with a business that can be opened for a relatively low cost. Entrepreneurs eventually have more flexibility than traditional employees, but not nearly as much as people seem to think.
Myth 5: no business plan is necessary
Don’t believe anyone who tells you this. Every business needs a business plan, which should cover your overall vision and mission of the company. Your business plan should also include information like the biographies of people involved with your business, market research and the competitive edge that your company has, the financial needs and expectations of your company, and any legal and regulatory requirements that your company must meet.
Myth 6: it takes technical knowledge to succeed with an online business
Most online businesses don’t require a lot of technical know-how. While some e-commerce storefronts may require a more advanced understanding of web development, there are many e-commerce software packages that are very user-friendly and make it easy to design your own website.
Myth 7: all e-commerce products are the same
This is the corollary to Myth 5. There are many different software packages out there, and different shopping platforms are designed to work in different ways. For example, there are different kinds of product catalogs, different kinds of shopping carts, and different payment platforms. Do some research before selecting your software, and choose what will work best for your particular business. It’s also a good idea to research companies for processing payments. You may be able to negotiate a lower fee per transaction if you shop around.
Myth 8: you can do everything on your own or automate it
Yes, it’s less expensive if you can manage to do everything yourself, or automate everything, so that you don’t have to hire anyone. However, not everything can be automated. For example, you still have to manage customer support and returns or refunds. Those are things that require a human touch. At some point, it will become more cost-effective to hire someone to whom you can delegate tasks, rather than trying to do everything on your own. Hiring someone doesn’t necessarily mean you have an employee, though. Freelancers are sometimes a great source of assistance with tasks you simply no longer have time for, and you can decide how much you need them to help with, and how much you can handle on your own.
Myth 9: social media is worthless
Social media is currently one of the most important factors in a business’s success or failure. Social media has given customers a way to easily and quickly voice their opinions, and this is particularly important to online businesses, which rely on the internet. Not only do people share their opinions on social media, but they also post on review sites, such as Yelp. Virtually all SEO professionals agree that social media is a must for any business.
Myth 10: your passion will make your business succeed
Many entrepreneurs are under the mistaken belief that if they just want something badly enough, it will happen, and if they work hard enough, their businesses will be successful. Unfortunately, that’s just not true. Yes, you should love what you do, but sometimes even if you do everything right, a business will still fail. That’s just the reality of life. However, doing what you can to maximise your chances of success will definitely benefit you in the long run, no matter whether your online business succeeds or not.
See also: Dos and Don’ts for online-only businesses
About the author
John Stone is a business consultant at Algorithm Seo Sydney. Through years of experience, he became a devout believer in the notion that form should always follow function and that developing the ability to think outside of the box is a prerequisite of being a successful entrepreneur.