The Internet has made it possible for entrepreneurs to launch business ideas without the need of any brick and mortar structure. Digital technology opened up a virtual world of opportunities with a market size of more than three billion users.

Within the first five years of the new millennium the website had evolved from a marketing, information platform to different incarnations. Entrepreneurs were using websites to host and run their businesses online.

One of the fastest growing online business industries is in Australia. A study published in 2013 showed that from 2010 to 2012 alone, there was a 200% growth in the number of online businesses in Australia. The growth in the industry corresponded with the increased expenditure of Australians. From 2011 to 2012, the average online transaction of an Australian grew from $118 to $142, far higher than the global average of $116.

These figures should be higher now that 60% of online traffic comes from mobile gadgets. Consumers are more dependent on the Internet for their everyday needs including shopping. Thus, with the number of smart phones expected to hit two billion in 2016, we should expect more growth opportunities for online businesses. October 2015 data already shows that the online retail industry continues to grow in Australia.

 

But how do you start an online business?

1. Identify a Need

Every business starts out as an idea. And ideas are generated by addressing a perceived need.

In order to build a clearer picture of your business idea, you will have to research. There are three key studies that you need to undertake: the market study, the marketing study and the feasibility study.

a. The Market Study. The purpose of the market study is to determine if there is demand for your product or service. Thus, it starts out by identifying which industries present the greatest demand. You will need to research trends. Based on data from 2012 to 2013, the highest number of purchases online in Australia were in the following categories:

• Travel, accommodation and memberships
• Clothes and fashion accessories
• Entertainment; CDs, DVDs, videos

b. The Marketing Study. The objective of the marketing study is to identify the avenues your business would take to reach your target market. Based on the data collected by the market study, you should be able to determine a marketing strategy that would maximize the reach and exposure of your products and services.

c. The Feasibility Study. This study rounds your entire project study. After gathering data and determining the courses of action, the feasibility study will weigh its costs versus its benefits. The purpose is to determine its viability. The feasibility study will answer the question, "Will I make money?"

 

2. Create a Business Plan

If your project study validates the decision to proceed with your business, you must outline your courses of action to achieve your list of objectives.

The business plan is the reference guide for all of your decisions. It lays out the time table of development to give you an indication if you are on schedule. Keep in mind that the bases for the business plan is your project study.

 

A standard business plan is made of the following sections:

a. Executive Summary. A condensed overview of what your business is all about.

b. Company Overview. An introduction to the company and its proponents.

c. Objectives. This list of targets and goals you hope to achieve.

d. Courses of Action. The main strategies you plan to implement to attain the objectives.

e. Alternative Courses of Action. Contingency plans in case the main strategies are ineffective in attaining the objectives.

f. Market Analysis. A summary of the Market Study.

g. Summary of Products and Services. The list of service or product offerings.

h. Funding Schedule. Itemizes your sources of funding and when these will be utilized.

i. Financial Projections. Establishes your revenue and income targets; largely represented by the projected income and cash flow statements.

j. Marketing Strategies. A summary of the strategies you will use to meet your revenue and income targets.

 

The business plan also serves as a valuable document when trying to source funding from banks, venture capitalists, crowd funding and other financial institutions.

 

3. Build a Website

It is simply impossible for your online business to succeed without a website. Social media may be popular but its role in online business is to generate inbound traffic to guess what? Your website.

Think of your website as your "brick and mortar" establishment in the virtual world. This is where your clients, subscribers and interested parties will find you. Social media is effective in generating leads but these leads need a destination or termination point. You cannot close the sale on Facebook. Within the sales funnel, conversions are done in your website.

Here are valuable pointers to remember when building a website:

• Website must be mobile responsive;
• It must be accessible by multi-browsers;
• Download speed should be no longer than three seconds;
• Navigation must be easy and convenient;
• Content must be relevant and engaging;
• For e-Commerce websites, it must have a page for placing orders and accepting payment; and
• Use relevant images and videos.

 

4. Hire Virtual Assistants

Hiring virtual assistants is your best option for managing your support systems. Virtual assistants do not severely impact your budget, improve productivity and are efficient because not only are they efficient but they can multi-task. Your support system can consist of two departments:

a. Back office support. This department manages all non-essential tasks such as e-mail filtering, accounting, calendar management, social media marketing and content management.

b. Customer support. This department can be distributed into inbound support and outbound support. Inbound support includes handling all e-mail inquiries, incoming calls and chat messaging. Outbound support is tasked primarily to procure feedback from customers and conduct surveys.

 

A Virtual Assistant can handle multiple responsibilities as long as these are complementary to each other. For example, you can hire a Virtual Assistant who can do e-mail filtering, calendar management, inbound call handling and e-mail support.

Then you can hire another Virtual Assistant who can handle accounting, CRM and outbound support services. A third Virtual Assistant can manage the social media marketing and content marketing process.

 

5. Build your Supply Chain

The supply chain is made up of your sources for the product you plan to sell. In this case CD's, DVD's and videos. In order to get the best suppliers, go to the manufacturers first and ask them for a list of their accredited suppliers or distributors.

Once you connect with a supplier, they will require you to accept documentation to qualify you as an agent or retailer. Documentation will include: business papers, bank statements, financial statements, references and required licenses. If you pass the qualifying process, you can be an accredited retailer.

If you have an e-commerce website you must open a merchant account with a bank and register a form of payment. Most online businesses will accept credit card payments and through other 3rd parties such as PayPal.

Starting an online business will take time and effort. But the costs are lower and the Internet will ensure you of a wider market. Most importantly, prospects remain good and favourable for Australia's online business industry in the years ahead.

 

About Felix Tarcomnicu
Felix works with the virtual assistant company, www.outsourceworkers.com.au. He enjoys writing about businesses and entrepreneurship.