How Much Does it Cost to Start an Online Business?

Technically speaking, you can start an online business for $0. You sell your products through Facebook Marketplace and this does not require money.

However, the truth is just because you can do, does not mean you should. You should be willing to spend at least $500 to build your online business.

Generally speaking, there are two ways to build an online business:

• You can build an online business on marketplaces like eBay, Zazzle, and Etsy

• You can also build your own store with inventory or without inventory (dropshipping)

The first option will require you to invest in products and marketing, some platforms also require you to pay to list your products. How much money you should invest in product development depends on the kind of products you are trying to sell. For a starter, $100 will be enough. Let say, you are selling T-shirts. You spend $50 on 5 T-shirts. If you list your 5 items on Etsy, you will have to spend 20 cents each and $1 in total. On eBay it is free. If you are an individual seller, the listing is free on Amazon but you will have to pay for storage. There are various ways to sell on Amazon and each program has different fee structures. You will have to spend the remaining budget on marketing.

The second option requires you to have a domain, buy hosting and launch your store. You can buy a domain for $10 and you need to pay about $4 per month for VPS hosting with Hostinger and $10 with Namecheap. You need products to sell, you might have to spend over $200 to develop 10 products. You will also have to spend at least $50 every month on ads.

If you are trying to dropship, which does not require you to spend on products, but you need a premium eCommerce content management system like Shopify and premium addons like Oberlo. You will have to pay $29 +$29 for Shopify and oberlo monthly subscription fees. Let's do the math, you will have to pay just about $70 to subscribe Shopify and oberlo add ons, and spend at least $50 to market your products.

Paul Lee once said, “Be ready to lose at least $500. If you want to launch a real store, you need at least $10,000. Spending $500 for ecommerce business is a small price to pay that can actually change your life.” Paul Lee is a person who created Husky Beard, a bread grooming brand at the age of 21 years. 

How to Market Your Business Without Burning Your Marketing Budget

If you are trying to build an online business, you might be able to start a business with a small budget, however, you may have to spend a lot of money in marketing in order to succeed.

Marketing is essential for all businesses to succeed. However, marketing needs proper planning in order to drive sales and generate revenue. Building a marketing plan means knowing your business, creating your business goal, making everyone working in your company stay focused.

So, how do you build a marketing plan?

Find your target audience: Finding your target audience means understanding exactly who your customers are.

Communicating your idea: Communicating your idea means letting your customers learn about your products and services.  This can be done by advertising your products to your target audience.

Creating marketing goals: You will have to create a short-term as well as a long-term marketing goal. Short-term marketing goals involve advertising your products and services, and long-term marketing goals mean building your brand.

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