10 Considerations When Setting Up an Online Business

tips on starting online business

The UK is the third largest e-commerce market in the world and for good reason. The internet has allowed innovative small businesses to reach a much wider audience, while cutting down on overhead costs.

Plenty of UK entrepreneurs and startups have capitalised on this and built a lucrative business out of selling their products online. If you want to get into this space, you first need to do your research and make sure everything is in place, from your online checkout to your online marketing.

Here are ten of my top considerations to anyone thinking of setting up an online business;

1. Who is your target market?

Running any kind of business begins with knowing who your target market is. Will your product answer a need? What are their demographics and psychographics? What are their pain points? Which social platform do they frequent?

The more you can get inside their heads, the better you can position your business as the solution to their needs. Creating a detailed buyer persona would be helpful.

You can start with an already profitable niche market, as opposed to disrupting an established one. While competitors would abound, it’s a sign that there’s profit in that industry—which brings us to our next point.

2. How are you going to build your website?

Your website is the online equivalent of a bricks-and-mortar shop so it’s probably the most important asset you’ll have after the items you’re actually selling. The good news is that you don’t need to have a degree in web development to do this.

There are plenty of web building solutions available online, but I’d highly recommend getting a professional web developer in to make sure this is as good as it could be. Whether you’ve opted to hire a web developer or do it yourself you should look for a trusted enterprise ecommerce solution.

There are services that bundle domain registration with site hosting. However, make sure that the domain would be registered under your name, as it would be a problem if your business name is technically not yours. If the terms are vague, then it’s better that you register your domain with another service provider that’s separate from your web host.

As for hosting, make sure that the service provider has features for an e-commerce business. Look at storage capacity, email, blog, response forms, marketing tools, security, and customer support.

3. How can you stand out from your competitors?

You also need to know who you’re going up against, whether you’re targeting local or international markets.

Find out how well your competitors are doing, who their target market is, and how they are going about their business. This way, you’ll see how you can better position your own business and discover any gaps that you can fill.

4. What is your business plan?

Think of your business plan as the blueprint of your success.

How are you going to finance, market, and advertise your business? Do you need to raise funding or are you financing your new business out of your own personal money?

If you need to raise finance, are you thinking of getting a business loan, or maybe crowdfunding? If you are borrowing money, how long until you need to pay it back? Come up with a plan with a timeline that you can realistically work with.

5. How will you build your inventory?

Building your inventory means knowing the range of products that you’re going to sell. How many variations of one product will you have (e.g. colours, sizes)? Are you going to manufacture them yourself or are you partnering with a supplier?

You need inventory at the beginning, but you have to make sure that you won’t end up with a surplus of unsold products. This process would be easier if your product is downloadable. But if it involves delivering physical products, you can look into dropshipping, especially if getting your own warehouse would be too costly for you.

6. What do you need for your shopping cart?

There are plenty of third-party shopping cart solutions available online; some of them are already recognisable by most online shoppers. But if you choose a self-hosted software, understand that some customers may be wary of trusting an unknown name.

You should also be flexible when it comes to payment terms. PayPal and Stripe are popular options. Whichever service you pick, calculate the fees, so you’ll know how much profit margin you need to cover them.

7. How do you optimise your copy?

Selling your products requires optimised copy both for search engines and your potential customers. Make sure that your site copy (e.g. product descriptions) is engaging, professional, on-brand, explains all the features, and is optimised for better rankings in Google.

Long form copy will always outrank short form copy so take the time to write long category or product descriptions for those pages that you really want to rank.

You should also consider running a blog to establish your authority in your niche and attract long tail search, providing fresh content for search engines and keeping your customers browsing your site for longer.

8. How will you market your business?

After launching your business, you need to explore various channels so your target market can actually find you.

I’d recommend working with a reputable SEO agency in order to make sure people can find your wonderful new ecommerce site when it goes live. It doesn’t matter how good your site looks, if nobody’s visiting it then your online business won’t last long.

You can also invest in paid ads on Google or social channels that your market frequents. Lastly, build an email list that you can nurture over time, so you can turn cold leads into paying customers.

Finally, make sure you encourage your customers to leave you Google reviews. In competitive industries this can really encourage click through rate (CTR) and set you apart from the competition.

9. What other business considerations should you keep in mind?

Generating revenue is the main goal, but similar to offline businesses, you also have to oversee various aspects of your e-commerce site. This includes making sure you’re on top of tax, licensing, trademarks, banking and payroll (if you have staff).

10. Which laws should you be aware of?

In the UK, e-commerce businesses need to comply with a number of laws, including:

GDPR

The General Data Protection Regulation came into force in May 2018. Failure to comply can lead to big fines.

Make sure your privacy policies are clear on how cookies are used. Give customers the option to turn these off. You should also ask for consent when asking for private information.

The EC Directive Regulations 2002

Display company information on the site, be clear with all customer fees, confirm all orders via email, and identify the sender of every email.

The Consumer Protection (Distance Selling) Regulations 2000

If you’re in the B2C industry, you need to give customers a 14-day leeway to return or cancel their orders with refunds.

The Consumer Rights Act 2015

The Consumer Rights Act 2015 consolidates laws regarding the sales and purchases of goods or services. It’s important you know what rights your customers have when they buy from you and what you must do to honour your legal obligations.

And finally

The work continues once you get your business up and running, and especially when you start generating revenue.

You need to keep improving your site (e.g. look for bugs), marketing new products, staying on top of inventory, and providing excellent customer service. Track your growth, so you’ll have a baseline and find out how to improve your numbers from there.

About the author

This guide has been written exclusively for ByteStart by Joe Cox,Content Director at Bristol-based digital marketing agency, Superb Digital.

More help on starting a new business

ByteStart is packed with help and tips on all aspects of starting your own small business. Check out some of our most popular guides;

Starting Up

Funding your business

Digital marketing

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