So you want to start an online business? You heard Joe from down the street is making a ton of cash selling online, why not you? All your friends say your creations are amazing and you should be selling them. Nowadays, everyone seems to have an online business in one form or another but there are really only a small percentage of online sellers actually making a part-time living on the internet and even a smaller percentage making a full-time living.
Unfortunately the reality is that over 90% of online businesses fail. I am not trying to discourage you but before venturing into the world of online business, I want you to have your eyes wide open – to think about things that maybe you weren’t aware of or consider something you might not have contemplated.
My first sale online came in 1999 when eBay was still in its infancy. My husband and I purchased some Coca-Cola wallpaper border for our new home from Target which we decided not to use and could not return. I had purchased a few things on eBay, so I decided to dip my toes in the water. The wallpaper border ended up selling for over $10 more than what Target sold them in stores. A few more items sold after that and I was hooked. Of course, after I totally emptied the house of all the random items that would have landed in a yard sale, I needed to find something to sell. I was burnt out at my current job and desperate to find anything that would replace my wage. I sold everything from yard sale finds, book seconds, used jeans to new old stock.
Thankfully, I was able to quit my day job in 2000 but we were just squeaking by. It wasn’t until my husband and I attended the eBay Live convention in 2003 that something clicked and my little business turned into a much larger one. In 2007, while I still maintained a thriving business on eBay selling custom photo Italian charms and accessories, Etsy opened the door for creatives. At the time as a hobby, I was making lampwork glass beads. Ebay just was not conducive for most crafters and artists at the time, at least not for me trying to compete against cheap Chinese glass bead imports. Between Etsy and my own websites, I quickly moved away from Ebay and mainly focused my online business in the creative niche which is where my heart is at and my focus since then.
I have been around the block when it comes to selling online and have tried just about everything – personal websites, eBay, Etsy, Amazon, Artfire, Tophatter, Cafepress, Storenvy, and the list goes on . I made a lot of mistakes over the years and wasted a ton of money at times. Selling online is not a get rich quick scheme. Don’t believe anyone that tells you it is. Of course, there are the occasional people that do “get rich quick” but they are by far the exception rather than the rule. If you’re looking to make a substantial income though, it is absolutely possible but before you begin ask yourself the following questions to see if you are ready to start your business.
1. Do you have products or services that you can offer that are in demand or meet a need?
While this seems like a no-brainer, it isn’t cut and dry. So many people want to start an online business but have no idea what to sell. Others have something already in mind but is it sellable? The key here is research. If you have no idea what to sell yet, what are you passionate about? Take a look at other online stores that are successful and find something that makes your heart sing. Take that idea and put your own spin on it. If you have a service/product in mind, are there others offering similar or the same items and are they selling? Is the price they are selling for the same or greater than what you would need to sell them at? If it’s a service, can you offer it for the same or cheaper price than your competitor? If not, can you offer a greater value?
2. Are you passionate about your product or service?
Along the same lines as the previous question, does your product make you excited? Would you still do this without the prospect of making money at it? If your business isn’t your passion or fun to you, you won’t stick with it. If selling your product is just a hobby for you right now, if you don’t have fun making the product, you will talk yourself out of creating it if it isn’t any fun.
3. Are you a self-starter?
No one is going to run your business for you. Can you keep to a schedule and not procrastinate? Even if your business is fun, there are still going to be aspects which totally suck. For me, it is doing shipments but I have set a schedule in place and know that it has to be done and the time has been carved out of the day specifically for shipments.
4. Do you have the time to put into a business?
If you’re still working your day job, do you have the extra time in the day to start a business? No one person can do it all and it is not reasonable to think that you could. If you have a full-time job, children, and a home to take care of along with still maintaining some sort of social life, it probably isn’t reasonable to believe that you would have time to put your all into a business. Of course, it’s not impossible but you will need to manage your time extremely well.
5. Are you able to invest your money into your business today without a return on your investment for a while (if ever)?
This is a big one. Most people don’t have a lot of extra cash lying around. Is the money you’re spending on your new business, money you could afford to lose or not see for months? You have to spend money to make money but don’t put your finances in jeopardy to open your business. Make sure you have a plan in place in case you don’t have sales right away.
6. Are you computer literate or willing to learn? Do you know how to use technology, i.e. camera equipment, photo editing software, etc.?
If you don’t know how to use a digital camera, upload a photo, or navigate a web browser and website, that really is the first place you need to start before even contemplating selling. There are plenty of classes in person and online that can teach you the basics. Youtube.com would be a very good place to start. Hopefully if you navigated yourself to this article though, you know the basics. If some learning is in order, get familiar with the basics and then practice, practice, and more practice.
7. Are you organized and can keep good records?
Keeping yourself organized will be key. Most people know creatives to be a little scatter brained and a bit on the messy side but staying organized will be essential in keeping your business afloat. To calculate how much you need to charge for items, you need to know your cost of goods to make them. You also need to allot a portion of the cost for your time involved. You don’t want to work for free. These are things that need to be tracked. In addition, this is a business and there will be record keeping for tax purposes, both sales tax (if applicable) and income tax. Of course, you don’t have to do this all on your own. There are a lot of websites, programs, and apps that can help you keep good records. Keeping good inventory numbers and knowing how much you are spending and making on your business is absolutely necessary.
8. Do you have good communication skills and can put your customers first?
While I don’t necessarily prescribe to the “customer is always right” mantra, no matter what, it is still necessarily to treat your customers with politeness and respect. Because of the nature of online communication and not seeing facial expressions or tone of voice, it is doubly important to be aware of your words and how they may be received. Even if your customer is completely irate with you, can you keep a level head and do your best not fly off the handle? Can you keep it professional without letting your emotions cloud your communication?
9. Are you committed to your online business? Are you willing to work long days, holidays, or weekends?
If you have the entrepreneurial bug and if you’re anything like me, you will eat, drink, and breathe your business. It is always on my mind which is sometimes a curse and sometimes the thing that keeps me going. I think it is pretty normal for those people that are fully invested in their ventures. Most entrepreneurs know that working long days or over holidays is just par for the course. Happily, being your own boss does have its perks but there are no doubt sacrifices made and you must be willing to make those sacrifices, especially when it comes to your time.
10. Are those around you supportive of your new online business?
Do your family and friends support you starting an online business? If you don’t have a support system, your business might be doomed before it even begins. A lot of businesses fail because of a non-supportive spouse. Maybe they’re holding the purse strings and you’re not able to buy supplies to support your endeavors or they try to sabotage your efforts at every turn. Do you have a tough backbone to see it through and show them you can succeed with or without their support or is not having their support a deal breaker?
There is never a “perfect” time to start a business but there is definitely something to be said for going into the process knowing your strengths and weaknesses. I definitely wish I could go back to my new business owner self and do things a bit differently. I hope that these questions helped you discover whether starting an online business now is right for you. I have created a coordinating worksheet which you can access below.