There are many advantages of opening a virtual business over a brick-and-mortar business like you can start as soon as you get a new idea for a business and with a very low investment of time and money. You don’t have to worry about renting and maintaining a place. Instead, one can start immediately by buying a domain name, signing up with a hosting service, creating an entry-level website, and getting started with an investment of only a few thousand rupees or even less.
Following are the steps to set up an online business:
- Identifying a Need
E-Commerce and Internet have been around for more than two decades now. But these days thus field is witnessing a lightning speed of innovation in offering new products and new ways to sell them. So the first task is to identify your market and get in touch with the people who’ll be buying your products or services and determine how you can best meet its needs. It is needless to say that you will not be able to compete profitably in the market unless you are fully aware of the current customer needs. These needs could be evident or latent; it is the novelty of a businessman how he identifies the need and the newer ways to satisfy it. An entrepreneur has to be aware of 3Cs of the online business: Competitors, Customers and Culture.
- Determining What You Have to Offer
Once you have identified the need of the customer, the next step is to figure out how you are going to satisfy that need. It’s the same for both online as well as offline business. It is necessary to answer some specific questions such as what the goods/services are that you are offering, where you are going to obtain those, if you are going to manufacture the sale items or procure them.
The internet is a very interactive medium. The medium favors business that do one thing well. So the key is not to try to do everything and be specific as possible.
- Setting up Online Business Plan
The next step is to prepare a business plan. It is always helpful to set specific goals and objectives from starting and then design strategies for attaining them. A business plan must contain the answers to some basics questions like why you want to start a business, why an online business, what would make customer buy your product/service online.
- Assembling the Equipment to Start the Business
For an Online business, the most important piece of equipment is a computer. Other types of equipment such as scanners, printer and extra workstations can be assembled as and when required. Some types of software such as webpage editor, graphics software and office utility software may also be needed. An online business can also be conducted through existing online classified Web sites (e.g. Justdial.com, olx.com) or auction Web sites (eg ebay.com). But mostly online entrepreneurs find that having a Website is indispensable for doing business as they want. Hosts like godaddyt.com can be used to create personalized web site very quickly and cheaply.
Picking a catchy Web address which is easy to recognize and be remembered is very important. Domain name such as www.company.com can be purchased from a Web host for a fee. The most suitable domain suffix is “.com”. If it is not available, then some alternatives such as “.biz” or ”. In” can also be considered.
- Setting Up a System to Process Sales
Payment gateways are critical for success of online businesses. The payment process could be a problem if the business exists online. Providing a safe and easy environment to customers for payment is necessary because people are still skeptical about using their credit cards online. Many companies have evolved innovative practices like cash on delivery, 15- day return policy etc. to allay the fears of customers. To process payment through credit cards, a web site has to tie-up with payment gateways like PayPal which provide a secure server to encrypt the payment related data with the use of digital certificates. Although these payment gateway companies charge some premium over each payment but they also provide an added security assurance to customers.
- Letting People Know that You Exist
The internet is crowded by online retailers these days who are trying to sell their wares online. It is imperative to stand out from the crowd in order to get recognized by customers. The companies that stand out either have innovative practices that disrupt the status quo or they are excellent in online marketing. There are many innovative practices ways to advertise online, such as search engine optimization, e-mail campaigns, newsletters, electronic mailing lists, social media and more. There are some unique online advertising forms such as banner ads, popups and interstitials, etc. But these kinds of advertising can be very expensive. Many online retailers exploit the social media, YouTube and chat forums where people generally discuss the related products/services