|What's it cost to start an online business?
by Bob McElwain
all a function of that extremely precious commodity called time. When
the alternator in your car quits, you can fix it yourself or turn to
a mechanic. Working the Web is no different in this regard. Doing it
yourself saves bucks, but may not be cost-effective. And it can be a
serious mistake if you lack required skills.
want your site to become a significant source of income, judicious
use of time is mandatory. No one person can do it all. And what you
need but don't have time to do, will cost.
Going Into Business
are starting a new business, you must file a DBA (Doing Business As
statement) or the equivalent in the county in which you will work.
After filing, it needs to be published, then you need to open a bank
account. Costs vary, but the minimum is about $50. Also consider any
state or local licenses required.
need an accountant, costs go up. Turn to an attorney, and they may
skyrocket. But you may need to consider these options because of the
products or services you will market, just as in an offline business.
You may need to consider liability insurance. Incorporation may
provide even more protection.
HTML vs Web
must understand the basics of HTML, the language in which web pages
are written. There is a time cost here. But at some point, most will
find it more effective to turn to a web page editor to save time.
Costs range from about $50 to $200.
someone to put a site together can cost thousands of dollars. More
important, you may find making changes later brings significant added
cost. It is best to build your own pages, for then you have total control.
template used throughout the site is so critical to success, consider
hiring an artist to get it right. Not the site, just the basic page
template. Once the site is established, it can be very cost-effective
to hire out the creation of new pages and updating. A good page
template with original art work can run anywhere from $200 on up, but
$500 should cover even special needs.
Paid Hosting Services
is only one option. You must have your own domain name ($13.50/year from 000domains.com) and a good hosting service. I have used Pair.com for many years. At $5.95/month it provides great performance.
ICDSoft.com is also good, at only $5/month.
You'll need a way to take plastic. For inexpensive solutions, check out ClickBank.com and PayPal.com. A merchant account can cost as much as $600 to get signed up. This may be a needless expense when just getting started.
Opening An Office
getting started, you will likely keep your present job, and it may
make sense to work from your home. Even so, you still need an
"office," including stationery, invoices, business cards,
and possibly brochures to be handed out wherever you happen to be.
Costs here are the same as in an offline business, and will be a
function of your needs.
overlook software. If you want to do some of the graphics for your
site, Paint Shop Pro at $99 is a good value. For your accounting,
Quicken is good. For mail list handling and personalized mailing,
including emailing, Easy Mail Plus at $50 is an excellent choice.
there are other things, such as supplies. Printers chew up enormous
gobs of paper. For competitive prices on consumables, try Office
Depot. Call 800-463-3768 for a free catalog.
A Phone Is
email address is not enough. You need a phone and someone to answer
it. Even if you expect to receive few calls, this is a must. People
often call just to see if you're for real. If there's no phone,
you've lost a sale. Some argue that voice mail is a reasonable
alternative, but it will not help if you can not get back quickly. If
you have a spouse who can answer, go for it. If not, find someone in
your area who can take calls as your secretary. If you provide
up-to-date information about your business, your "secretary"
can often save you the need for a later reply. Further, there is
simply no less expensive way to appear to be working the business
Where We're At
above is not the whole of it. For example, there has been no mention
of search engines, yet good positioning can make a big difference.
Again, if you know how to optimize pages and can do so easily, it is
worth your time to do so. If not, hire it out. Writing skills are
important. If yours aren't so hot, factor in some cost for editing,
or even creating both page content and the advertising message behind
all. Good service is available at $25-$50/hour.
must add up these costs relative to your particular needs. But it is
unlikely you can start a serious online business for less than $500
to $1000, even if you do all the work yourself.
Time Cost Analysis
Starting any business means commitments in time you can not expect to
recover except over the long run. So good cost analysis is difficult
initially. Even so, put a dollar value on your time, perhaps as low
as $5/hour, to help you make good decisions about how you will use
your time. Even at $5/hour, it will be clear that some things should
be hired out.
Building web pages with HTML when you could be generating leads may
not be the best use of time. Reading a book or two about how to work
the Web can be very helpful, but sometimes it's more cost effective
to buy the information needed.
harder is often the only option available. But when possible, work
smarter, which often means hiring services. In the end you'll have
more fun and rake in greater profits sooner.
Bob McElwain <SiteTipsAndTricks.com>
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