How much does it cost to start an online business?
The cost varies depending on your budget. You can take a bootstrapping approach, or you can invest heavily. The amount your spend / invest alone won’t determine your success. Grit, focus and consistency are much more likely to determine your success.
The age-old adage of time versus money applies to starting an online business as it does everywhere. Have more budget? Then you can afford to pay for more consultants to help you with market research, branding, business strategy, admin, customer service, and all the other elements of running a business. Less budget? Then you will need to do more of this yourself and upskill in areas you are less familiar with, or simply ‘wing it’.
What are the basics costs to start an online business?
Zero or free online business start up costs
If you want to take the completely FREE approach, it’s just about possible with determination, grit and focus.
You will want to take advantage of every 30-day trial you can get your hands on and make the most of those 30-days.
I would recommend you spend money on at least registering a website address (domain).
You can establish an online presence with simple a Facebook Page (free). Use Google Forms (also free) for market research and setup a Paypal account to collect money (free). Shopify offers a free trial also if you want to setup an online store, but you will need to pay, once that time is over.
If the FREE option appeals to you, then doing a lot of the business planning, market research, audience and value proposition work BEFORE you start those trials, will let you make even more use of them.
Bootstrapping or low online business start up costs
This is where you have a small budget, but you want it to stretch as far as you can. Our 5 Simple Steps to Start an Online Business suits this approach.
Doing your business planning, market research, audience and value proposition work before you start spending on marketing and advertising is a good strategy. This will help ensure the money you do spend is spent strategically and avoids wasting money.
The 5 Simple Steps to Start an Online Business also includes some tips to help you get your business name sorted so that you don’t waste time and resources on branding or marketing a business that you cannot legally use!
To bootstrap your branding: logo and design elements, we recommend Canva.
Initial online business startup costs – establishing your online presence
Some of the initial costs will include:
- Business name registration
- Domain name registration (website address)
- Website hosting (a place for your website to live) / website platform (a more done for your option like Clickfunnels or Shopify)
These are essentials for an online business. Your budget will vary depend on whether you DIY or pay for an expert consultant to get your website and online presence setup. DIY will take longer and there is the risk of not doing it to the standard a professional will. CAlculating your risks and mitigating them is part of business.
Marketing and sales for your online business
Once you have an initial online presence setup, you will want to start marketing your business. There are some further options here:
- Advertising – will you invest in ads, for example Google Adwords, Facebook Ads, Instagram ads? What will your budget be?
- Outreach and PR – this can be done yourself or you can pay someone.
- Search engine optimisation – this is being found in search engines like Google and Youtube. Will you upskill and take a DIY approach or pay for the expertise?
- Branding, copy development and creative – Canva is great for creative elements, copy-writing will be up to your confidence in your skills and again, whether you want to DIY or outsource. There are opportunities to pay for ‘swipe files’ where you can purchase large volumes of pre-written sales emails, landing pages, etc. so that you can simply customise for your online business.
Determining: How much does it cost to start an online business? Is really up to each individual set of circumstances. If you want to start a hobby or a side hustle then going for a free or bootstrapping path may be really appealing. However, if you want to speed up the path to earning income and setup a professional online presence to attract a high-income earning audience, you will want to invest more money.