As the buyer of an online business, it will help if you enjoy wearing multiple hats and desire a flexible job that allows you to work from anywhere.
Although an online business is not your typical nine-to-five job, the irregular hours are more manageable because as the owner, you have the freedom to set your work schedule around your lifestyle and family routines.
Finances and statistics
As a rule, growing a business will require substantial cash flow. Since many online businesses have few physical assets to use as security, an unsecured loan is one option to consider.
With an unsecured loan, there is no risk to your personal property, and depending on the terms of the loan, you might have the freedom to invest the money in your business as you wish. Another viable option you can look into is to bring investors on board.
When looking to attract investors, it’s important to be aware that you will most likely be competing against thousands of other businesses.
In order to set your business apart, make sure you’ve developed a strategic business plan to present to prospective investors that highlights your products, services, and future growth potential.
Visit here to see price ranges of current businesses for sale in this sector.
Laying the groundwork
As you begin looking at internet businesses that are available for purchase, keep in mind what your goals and plans are, as well as the specific products or services you would like to offer. For example:
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Decide what your business will sell or provide:
- Look for a niche in the market where you can offer an improved product, a more convenient service, or a better price.
- Keep in mind that small, lightweight, and easily packaged products won’t be as difficult to store and will be cheaper to ship.
- Make sure your products are easy to re-order and keep on supply.
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Determine your personal business plan:
- What’s unique about the products or services you are going to offer through your website?
- Who are your target customers, and how will you reach them?
- Who are your primary competitors, and how will you set yourself apart?
- How are you going to market your business?
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Decide which online business structure best suits you:
- There are four main options to consider: sole trader, partnership, company, or trust.
- There are pros and cons to each one depending on your budget, the initial size of your business, and your future plans for growth, so do your research, and choose the best one for you.
Licences and permissions
Prior to engaging in any business activities, you will need to decide the name under which you will trade and then register your online business so that you can receive your business number.
There are a variety of taxes that can impact your business. You might have to register for the following:
- Australian Business Number (ABN)
- Goods and Services Tax (GST)
- Tax File Number (TFN)
- Pay as you go withholding (PAYG)
- Food business licence (if you plan to sell any food)
To ensure you are compliant with all required licensing and registration, it is highly recommended that you conduct thorough research and enlist the help of a tax accountant to determine which licenses or permits are applicable to your online business.
Due diligence
When you are planning the online aspects of your business, you should do the following:
- Research your competitors and other businesses that use online tools. The more you know what's out there, the better.
- Decide what aspects of online business will benefit your business.
- Review your budget to determine what you can afford.
- Familiarise yourself with any laws and regulations that will apply to your online business activities. Visit here for a helpful guide to ensure your business is legally compliant.
- Consider your requirements, including what software you need and what types of computer equipment you need to run it.
- Plan for risks, such as computer viruses, scams, data theft, and loss of or damage to hardware.
- Determine what training you or your staff might need.
- Establish the time and budget you will need to manage the online aspects of your business.
There are numerous steps to take in the due diligence process. Take your time, be thorough, and be prepared to negotiate. To assist your efforts during this stage, the government has created a helpful guide for buying and selling online.
Once you’ve established the type of internet business you would like to buy, developed a strong business plan, and obtained the necessary financing, you are well on your way to being a business owner! Visit here to let us help you find the one that’s right for you.
