How To Start An Online Business In 2023: A Beginner’s Guide
by Sumona Starting a Business 27 December 2022
With today’s economy, almost everyone is on the lookout for ways to earn extra income. As such, starting an online business in 2023 is an attractive prospect.
In fact, a recent survey shows that 2023 is the year of social media hustle, especially for Gen Z according to Instagram’s 2023 trend. Additionally, the trend also shows that “people’s interests” will transform into side hustles.
If you want to boost your income streams, you’re probably thinking of starting your own e-commerce business using your skills and interests. In this article, we’ll go over the key steps on how to start an online business.
How To Start Your Business
1. Refine Your Online Business Idea
If you’re planning to start a business, you likely already have an idea of what you want to sell online. But is your business idea feasible? Does it have a good market?
Before anything else, you need to refine your business idea. Do a quick research about existing e-commerce businesses in your chosen industry. Learn what they are doing right and figure out how you will have a competitive advantage.
- In the words of Simon Sinek, “start with why”. You need to know why you want to start your business. Is it for personal reasons or do you want to fulfill a market need?
- Brainstorm your business name. Your business name will serve as your brand. Make it stick and make it count. Check if your business name is available as a domain name or username on social media platforms.
2. Find Your Niche
Creating a niche market and positioning yourself as a go-to brand for a specific audience will lead to a successful online business. It establishes your brand credibility and builds customer loyalty. That said, when you’re thinking of what product to sell, you need to come up with a specific niche.
So how do you define your niche? Consider these factors:
- Price (premium, moderate, cheap)
- Demographics (age, gender, income level)
- Level of quality (premium, handmade, economical)
- Psychographic (interest, attitude, values)
- Geographic (region, country, or neighborhood)
There are plenty of profitable niches you can pursue. For example, you can sell handmade baby clothes made from recycled or sustainable materials.
| Here are tips on how to find a niche market: Think of your passion and interests. What are you naturally good at? What are your hobbies? Identify your target audience’s problems or needs. How will your skill or interest be useful to others? Perform market research and competitor analysis. Before you start developing your new business idea, research your potential competitors. You can use these tools for your research: Google Trends Google Keyword Planner Amazon or Shopify Know your unique selling point. This is where identifying your niche comes in handy. What customer problem or needs are you addressing? What makes your product or service better than the competition? Test your product or service. You can set up a social media account where potential customers can find you. Or you can take a bigger leap and create a simple landing page. Offer giveaways for your product or a discounted price for your service. |
This test period is not meant to generate a lot of money, but it will help you figure out if there is a market for your product or service.
3. Write a Business Plan
The next step is to write a business plan. Doing so will help shape your online business from the inside out. It provides you an opportunity to set goals as well as lay out a business strategy to achieve those goals. Additionally, a business plan will also outline the steps you need to take to finance your online business.
| Here are a few questions you need to answer: -What are your business goals? -Who is your target market? -How will you finance your business? -Do you need to hire people? How big should your team be? -How will you market your business? -For online businesses, you need to figure out which e-commerce platform to use or social media platforms to focus on. |
4. Assess Your Finances and Consider Your Funding Options
When starting a business – whether it’s a brick-and-mortar business or an online business, there will always be costs involved, including:
- Startup costs
- Fixed costs
- Variable costs
- Marketing costs, including social media marketing
- Business Insurance
- Legal fees
Calculating these costs will help you determine how much you need to jumpstart your online business. Plus, it will also help you determine your profit margin.
| So how will you finance your business? Thankfully, you have plenty of financing options in Singapore. You can consider taking a traditional business loan with the bank. However, if you don’t meet their strict eligibility requirements, you can also consider taking a business loan with licensed money lenders. Other ways to fund your business include: -Government startup business schemes -Business grants -Investors -Crowdfunding |
5. Register a Business in Singapore
All companies or business owners who plan to carry out profit-generating activities need to register their businesses and get the necessary business license in Singapore.
But first, you need to decide on your online business structure. The structure you use will determine the legal and tax requirements you need to meet.
- Sole proprietorship: This is a simple business model but it is riskier for online business owners. They are personally liable for any debts that the business might incur.
- Limited Liability Partnership (LLP): There must be at least two up to a maximum of 20 partners to set up an LLP. The legal liability of individual partners is limited in the same vein as Private Limited Companies.
- Private Limited Company: This is one of the most common types of companies registered in Singapore. A maximum of 50 shareholders are allowed – they can be companies, individuals, or both. With this structure, the business is separate and distinct from shareholders and directors.
| How To Register a Business Company Name Approval: The business name must not be in conflict with any existing business in Singapore. You can read the complete requirements here Company Registration Documents: ACRA requires specific documents for business registration company constitution -Description of business activities -Signed consent forms for each director and company secretary -Identification details for each shareholder, including address -Business address -Paid-up capital information Formally apply with ACRA: You can view a detailed step-by-step process here. |
6. Build Your Website or Choose Your E-Commerce Platform
A great website is essential in launching your business online. One of the easiest ways to create a website is through a website builder, such as Shopify, Wix, or Squarespace.
With these tools, you don’t need excellent coding skills. They have a very easy-to-use interface where you can simply drag and drop the tools you need for your online store.
Aside from choosing a website builder, you also need to:
- Purchase secure, scalable website hosting. Most website builders already have bundled website hosting.
- Obtain a good domain name. It’s best to use your business name so your target audience will easily recall your brand.
- Have a clear description of your business.
- Make use of content management systems (CMS). A CMS is important in creating blogs for your website. Some website builders, such as Wix and Squarespace, already have good CMS.
Lastly, you need to choose a good e-commerce platform. Here are some of the most popular platforms:
- Shopify
- Etsy
- Lazada
- Shopee
- Carousell
Conclusion
Finally launching your online business will feel exhilarating. However, once your business is up and running, you need to continually take steps to make it grow. You can consider different strategies, such as seeking additional funding, investing in marketing your business or selling overseas.
Key Takeaways:
- Do a quick research about existing e-commerce businesses in your chosen industry.
- Finding your niche will help you position yourself as a go-to brand for your target audience
- You can seek funding through traditional bank loans or take business loans with a licensed money lender in Singapore
- Website builders, such as Wix or Squarespace, will help you easily create a website through their drag-and-drop features.
Additional:
Related
