8 Steps to Creating a Successful Online Business
If you have an online business, it is easy to work from any place in the world, make a living on the Internet and even set your own hours. The online business is great for those new entrepreneurs who do not have a lot of funding since the start-up costs are extremely low. But you need to have the right tricks to start a successful online business.
Here is a comprehensive guide on how to start an online business:
Step 1: Select the Business Structure
The first most important step that must be taken when starting a business is to decide if you would be operating the company as a corporation, limited liability company or a sole proprietorship.
A husband and wife or an individual can run the business as a sole proprietorship. It is one of the simplest kinds of structure of a company where you wouldn’t need to file any paperwork for setting it up. Nonetheless, a sole proprietor does not have any protection from the liability for the obligations and the debts of the business.
And this is the reason why many people who want to start a successful online business opt to form the limited liability entity rather than the sole proprietorship. The limited liability entity types include a corporation and a limited liability company. And if a person chooses to take up this company structure, they are normally not personally liable for the obligations of the company.
Even though an LLC requirement involves less reporting and record-keeping and are more flexible compared to a corporation, a corporation can be the right choice if you are searching to get funds into the company from the outside investors.
Step 2: Determine Where to Form Your Company
If you choose to form a corporation or an LLC, you would have to file the paperwork with the state. For many of these small businesses, it is beneficial to submit the formation documentations in the state in which you are located. With the help of this, you would be avoiding the additional amount for registering to do business in your own state and even the cost for hiring a registered agent that is out of state.
Nonetheless, in case your company would have an unusual nationwide activity, or if you wait to draw venture capital, that is when you might have to contemplate incorporating in Delaware. This is the only and right way how to start an online business in the USA.
Step 3: Decide a Name
To choose the right and unique name for your business, take time to think it out since it is worth it. A unique name:
- Complies with state law obligations that LLC or corporation names be distinctive than every other business name that has been registered in that state.
- Improves the possibility that you would be able to obtain a domain name that would be the same as your business name.
- Reduces the possibility that a correspondingly named company might sue you for trademark violation.
- Benefits you in marketing your business and brand.
As soon as you have a name in mind, you can get on Google to conduct a search and find out in case there is any similarity in the name or if any other business has that name or not. This is an important step to start a successful online business.
Other than this, you could also search the Trademark Office and the U.S. Patent website for the trademarked names. Most of the states enable you to look for the business names that have been registered online.
Step 4: Get a Domain Name
The next step in how to start an online business includes registering a domain name. And this should take place once you have chosen the name for your business. The domain name here would be the address on the Internet that would reach to your business website, and it would end with a “.com.”
To check if your domain name to start a successful online business has been used by someone else or not, just type in your desired domain name in your browser and click search to check if someone is using it or not. If a web page opens, it means that it has been taken and if it comes as “cannot find the page,” you are lucky since the domain can be bought.
A lot of the businesses provide the domain name registration service, and the process is very straight forward. All you need to do is make an account on the website that offers the service, search for the domain that you want to register and then pay the annual fee for it to purchase it. That is all, and you have the business domain with you.
Step 5: Submit the Formation Papers of Your Business
To start a successful online business, you would have to register the business with the state just like you would for any other business. This needs filing of the documentation with the agency in the state, who is in charge of the business filings. Along with this, you would be required to give the filing fee that can vary from state to state.
As soon as your LLC or the corporation has been formed, you would obtain a certificate that would confirm that your new business entity exists.
Step 6: Set Up Your Finances
From the IRS (Internal Revenue Services) website, you would be able to receive a federal tax ID number. In case you are a single-member LLC or a sole proprietor, you get the chance to choose to utilize your Social Security number instead of the number from the IRS.
Other than this, to start a successful online business, you would also be able to open a business bank account. Moreover, if you would be processing any transactions via the website, you can also open an account with PayPal or any other online payment service.
Step 7: Comprehend the Licensing and Sales Tax Requirements
In case you are trading goods or services online, you would most probably need to assemble and return the sales tax for any transactions in any state. This is for any state in which your company has a physical location or where you have it registered.
However, procedures vary from state to state and it’s a good idea to contact your state’s taxation department and/or an accountant to find out your responsibilities. You would need to verify with your county or city to figure out in case you require a company license. Also, you would need to confirm if you are expected to register a DBA or a legendary business name.
Step 8: Set Up Your Website
For having the website put up on time and working properly, you would need to buy the web hosting. You can get this from the same companies that offered the domain registration. With the help of a host, you get a place on the Internet where your website can live freely. It’s like renting a house there on the Internet for your site.
For you to start a successful online business, you would need the help of a professional web developer, unless you are a professional yourself. But if you are not, you can expect to spend a lot for having the website set up and running perfectly online.
Moreover, hire a professional only if you believe that you have the budget. You would need to get the following done:
- Creating & inserting a logo.
- Creating text & images.
- Optimizing the site for search engines.
- Configuring the website to resemble the way you want it & also, incorporate the features you need.
As soon as you have selected the business structure and the name of your business, set up your website and file the paperwork with the proper state, you would be ready to begin your business online.
Moreover, you would need to work a lot since the Internet is a busy place and sitting down, waiting for customers wouldn’t help you. Search for methods that would help you promote your business via the advertising online, old-fashioned word of mouth, and even via the social media.
This story is published in The Startup, Medium’s largest entrepreneurship publication followed by 314,551+ people.
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