In the second quarter of 2014, Internet sales in the U.S. were $75 billion, rising 4.9 percent over the first quarter of the year. With figures like that, it’s no wonder that so many people are saying that the Internet is where the money is. If you’ve been hearing that wisdom for years, it’s natural that you’d be curious about exactly what the prospects are for moving from owning an offline business to an online one or leaving your current job to enter the world of online business as your own boss. So what’s holding you back?
If you’re like most people who have toyed with or seriously considered moving from an offline to an online business, uncertainty likely bears at least part of the blame. Many people state that they would be eager to enter the world of online business but just aren’t sure what their options are. Sound familiar? Read on to learn more about transitioning from an offline business to an online one.
What Types of Businesses Can You Have Online?
Many people aren’t sure just what kinds of businesses operate online. There are many different types, including the following:
– Traditional e-commerce: A traditional e-commerce store is a business that sells items to customers through their own individual website and processes their own sales.
– Marketplace e-commerce: Marketplace e-commerce stores run on sites like Amazon, eBay and Alibaba. They sell products to customers who find their products on the marketplace stores, which also process sales on behalf of the stores for a commission or fee.
– Digital Marketing: Digital marketing companies promote online and offline companies on the Internet, using a wide variety of strategies.
– Flash Sales: Flash sales sites work with retailers, wholesalers and manufacturers to offer short-term sales on various types of products and services for a commission.
– Wholesalers: Online wholesalers supply goods to brick and mortar and online retailers without operating an office location.
– e-Fulfillment Centers: e-Fulfillment centers handle order filling and shipping for online retailers.
– Services: Online service providers provide work for clients without ever meeting them in person. Examples include online personal assistants, paralegals, writers, accountants and more. These businesses can be sole-proprietors or large businesses that employ multiple service providers.
– Software, Website and App Development: Many software engineers and graphic designers sell custom software and app development services and website design services completely online to both brick and mortar and online businesses.
Should You Start Up or Acquire?
Once you have decided what type of online business would be the best match for your interest and skills, you’ll face another big decision: should you start your own business or acquire one? For many people, acquiring a business ends up being the better choice. Here are some of the reasons why:
– Immediate earning potential: If you purchase a successful established online business, you’ll enjoy immediate access to cash flow. You won’t have to continue working at your job or juggle two businesses while you try to get your start-up off the ground.
– Established roots: When you purchase an online business, you’ll already have vendors, customers, employees, a website and an established brand to work with. Even if you need to improve upon the business to strengthen it and ultimately ensure its continued success, you’ll have established roots to grow from, greatly reducing risk.
– More financing options: If you’re going to borrow to acquire all or some of the capital for your online business, you’re more likely to secure financing if you purchase an established business with attractive financials. Just as the acquisition of a successful company means less risk to buyers, it means less risk to banks, making more financial institutions willing to lend.
– Guidance from a previous owner: Most online business sales will include a transition period during which the owner will help you settle in and begin running the business on your own. With a start-up, you’re likely to be flying blindly, meaning more stress, more hassles and more room for error.
If you’d like to learn more about purchasing an online business, give us a call. We are currently representing business owners with an array of online business types and can help you explore your needs and provide you with options that will be a good match for you.