How to start an online business from home?
There are plenty of benefits to starting an online business. You can work from home, set your own hours, focus on a niche you care about, and typically avoid substantial startup costs. And even though starting a business online is more accessible, for you to grow and maintain it, you will have to follow the process that is similar to starting a traditional business. So, if you want to start an online business from home, keep reading as we have gathered all the information you need and have put it here.
Advantages to Start an Online Business from Home
Before we talk about how to start a business at home, let us see the advantages to start a business from home. Working from your home and online offers you more freedom over your schedule. This means that you can easily multitask professional and personal responsibilities. You can work whenever you want, by the night or by the day.
In addition to this, the startup costs are lower. Working at home means that you would not have to pay any rent for an office or store space. This would not just help you save money, but also the time you spend commuting. Moreover, if you start an online business from home, it would help you save a lot of tax as well. This is because some of the laws and regulations would allow you to deduct a part of your home’s expenses such as the property taxes, maintenance, mortgage, and so on, on your business tax return.
Online Business Ideas from Home
If you have made up your mind and you want to start an online business from home, then the next step is to pick up an idea. Here are some of the online business ideas from home that you can choose from:
- Graphic design
- Web developer or web design business
- Digital marketing, or social media marketing service
- Affiliate marketing service
- Transcription service
- Translation service
- Virtual assistant
- T-shirt printing business (with an online store)
- Dropshipping service
Steps to Start an Online Business from Home
Even though every business is unique, there are some steps that all businesses have to take when starting an online business from home. The steps include:
Step 1: Write a business plan
Just to be clear, preparing a business plan does not mean you get guaranteed success. But it does help you in a lot of things. To begin with, it would help you have a roadmap to where you want to reach as you will not just share all the steps in it but also how to execute them and where it would take you. It would help you determine what you need to do so that you can improve your chances to succeed.
There is no specific format for a business plan, but there are some common parts that need to be there. These include:
- Executive summary
- Business description
- Market analysis
- Product or service description
- Sales and marketing strategy
- Financial plan
Some of the business plans can also include an optional appendix for information that is too cumbersome for the central part of the document. Also, when you are presenting your business plan to an investor, then limit it to fewer pages. There is no point in giving them a 20-page plan that they would not even read. And since the business environment is very competitive, it is important for you to consider what you can leverage to your advantage when you are creating your plan so that you can get the most needed and best help.
Step 2: Choose a name
The next step is to select a business name for your company. This is one of the most important parts of your brand and you need to choose the name that projects the right image of your company. So, it is important to choose a name based on how you want your customers to view the company as.
You want a name that is unique and creative, but also the one that makes sense for your service or goods. The best way to go around this is by researching the name(s) you have in mind and see if no other business has it. It is important to have a unique name as you would not be able to register your business otherwise. Moreover, the name should not be similar to another business name as well, since you can be sued by that company. And you obviously, do not want your customers to confuse your business with another one, right?
Choose a name that looks professional so that all the customers take your company seriously. All-in-all, keep the name short and sweet.
But before you select the name, do check out the naming rules on the Secretary of State website for the state in which you want to incorporate your business. There are some additional rules that you need to follow as well.
Step 3: Create a Website
When choosing your name, you will also have to check if there is a domain available with that name. This is obviously because you are working to open an online business. And an online business means that you will need a website, which needs a domain. So, even if you do not have the content or products to add to the website yet, it is advised to check for the domain name and also register the website for your business.
It is important to choose a domain name that evokes a positive image. And remember, Google is the first place that a lot of consumers search to get information about your business and that is why your domain should be visible there. That is how you will be able to reach more people and work on making your company successful.
Step 4: Select Your Business Entity Type
The next important step is to choose the business entity type and then register your business. Selecting the legal structure would help you determine how you will run your business legally and how you would be paying your taxes as well. It would also help you in determining the structure of your company. The most common structure for a small business is a limited liability company (LLC).
For the entrepreneurs that are aspiring to become successful fast, this is an important step that has to be taken. If you plan to grow your company, then choose from a corporation (S corp/C corp) or an LLC. Take the help of a firm that can assist you with it like IncParadise (IncParadise can help you understand which one to choose and in incorporating your business as well in the US). You can also take help from your lawyer to find out which business structure is better for your company.
Note: To register your business, you will need an address that would be your business address. And if you are working from home, using your home address might not look professional for you. The best way around this is to opt for the virtual address and mail forwarding service. Under this service, you will get an official business address (virtual address).
Step 5: Get a FEIN
Now that you have your company legally registered, it is time to take the next step which is to get a FEIN (Federal Employer Identification Number). Even though you would be running your business online from home since you started your business using one of your online business ideas from home, there are some laws that you need to comply with. For example, based on your business structure or if you get employees, then you will need the FEIN (also called EIN). Moreover, even if you do not need it, it is better to get it. This number helps you in creating a business bank account for your business.
Step 6: Obtain Necessary Permits & Licenses
Another thing that you need when you start an online business from home is to get the needed licenses. The very first license that you might need is to operate a business from home. You will have to check with your local government agency to see if you need this license and about what other licenses you need. It is also advised to take the help of your lawyer to understand what all permits you require so that you can be in the safe.
If you ignore this and break a rule, your business can be terminated and you would have to pay hefty fines as well. So, it is better to handle this as well. Once you have worked on all this, you can then move towards launching your website and starting the business.
Ready to Start Your Online Business from Home?
It does take a little work to start a business from home. But like said by some smart people, “nothing good comes easy”. So, take time and ensure that all the things are done properly. Another step that you can take other than those mentioned above is to get an address for your company. You obviously want to look professional for everyone and it is also a good idea if you do not want legal mails coming to your home always.
Getting a virtual address for your home business would help you a lot. If a client wants to see your address, they would see a professional address (which would be the virtual address). Also, all the mails that are both important and spam ones would be sent to this virtual address (that we provide) and we would skim the important ones to send them to you via mail or even through email (based on your choice). To know more about this and the service, contact us at PO BOX Zone!