There has never been a better time to start a business. In our hyper-connected digital age, you can set up a website, online store, and entire brand from anywhere in the world.

Online business-building tools have never been more accessible—and with the right approach, you can grow a loyal customer base quicker than you might think.

If you’re wondering how to start a business in 2023, we’re here to help. In this guide, we’ll look at the essential steps you need to take to make your business a real success. Here we’re going to cover:

FAQs

Ready? Great. Let’s get started.

Related: How to start a business

1. Find a business idea

First of all, to enjoy sustainable commercial success, you have to find a business idea that is not only feasible but something you feel passionate about.

If you have a shortlist of business ideas in mind, dig a little deeper by carrying out a little market research. Look at brands in your potential niche and find out how their consumers engage with them while looking at overall demand based on public sales or growth data.

Doing so will give you inspiration for your own business ideas. Armed with your market and competitor research, you can develop your ideas by considering:

• What am I passionate about?
• What are my specific skills and expertise?
• Which subject matter am I most passionate about?
• Can I feasibly sell or promote the product or services in my potential niche?
• What unique spin can I put on well-trodden business ideas or concepts to stand out?
• What gaps or weaknesses can I exploit in my potential niche or market?

Ask yourself these questions and you’ll eventually land on a business idea that has the potential to scale while keeping you engaged and inspired in the long term.

Related: Read our guide on essential small business ideas for more small business inspiration.

2. Use market research to validate your idea

Once you’ve landed on a solid business idea, you’ll need to see if it has any legs. We just touched on the concept of market research, but now we’re going to drill down a little deeper.

When brainstorming business ideas, you will have scratched the surface. But, to really validate your concept, you must get under the skin of your industry as well as your target audience. In addition to gathering industry insights and data, you should build buyer personas that represent your ideal target audience.

During this phase of the operation, it’s also important to conduct extensive market research as well as market analysis. Here are some market research and analysis ideas for your consideration:

• Conduct consumer surveys across channels (phone, email, social media, mobile app, etc.).
• Hold focus groups to gain a deeper understanding of how your target audience might perceive your brand and what you have to offer.
• Observe how your target audience engages with potential competitors on social media as well as the related subject matter they’re discussing online.
• Explore public data related to your target market to uncover consumer buying patterns as well as sales trends. This will help you validate your idea while giving your business planning a definitive direction—which brings us onto our next point.

3. Create a business plan

Now your idea is validated and you’ve got a handle on your target market, you’ll need to start planning. When it comes to knowing how to start a business, developing your plan methodically is a vital skill. Here are some tips to help you navigate the process like a boss:

• Consider your “why”. This will help you gain an understanding of your key motivations for starting your business as well as what you want to achieve
• Outline plans of action or initiatives  that represent your brand mission and what you do
• Define your key business goals using timelines and milestones to keep you on track
• Write an executive summary that states all essential information related to your business’s aims, goals, and products

To break down each step in more detail, read our essential guide on how to write a business plan and use our official business plan template to make sure you don’t miss anything important.

4. Get funding, explore finance options

To get your business off to a flying start, you’re going to need to get the right level of funding. The funding options you explore will depend on the type of business you’re looking to start.

If you’re looking to start a solely online business and scale up, you could use your personal funds or savings to get up and running. Doing so will give you complete control on your decisions, allowing you to scale the business on your own terms. But, it’s worth noting that if your business struggles or fails to achieve profit, you will be solely responsible for paying back any debt.

Other business funding options include:

• Crowdfunding: Using dedicated crowdfunding platforms, you can inspire people to donate to your business venture in return for incentives or equity. This can be a very effective form of fundraising—and there have been many crowdfunding success stories over the years.
• Gain a line of credit: Akin to obtaining a personal line of credit, you can gain a line of business credit. The terms, limits, and interest rates will depend on the nature of your business as well as factors including your financial history and credit rating.
• Get a grant: Another way of securing a healthy level of funding for your business is getting a grant. If your business mission is rooted in building a better community or inspiring innovation, you could be eligible for a healthy grant from the Federal Government.
• Pitch to investors: Researching investors in your niche and pitching to them is an excellent way to get funding as well as professional backing and expertise. This is certainly an avenue worth exploring if you’re looking for startup capital as well as help with your business’s launch and development activities.

Interested in learning more about planning for business funding? Our guide covers the cost to start a business in full detail.

5. Choose a legal business structure

When starting a business in 2023, settling on a water-tight legal structure is vital. Before you officially register your business, you have to decide on a concrete business structure—and the type you choose will impact your business from a legal standpoint. So, take your time when considering these structures.

Sole proprietorship

If you own your business independently, you can opt for sole proprietorship. This means that you will have full autonomy over your business, but you’ll be responsible for all debt, obligations, and finances.

Pros:

• You will be in full charge of business decisions, development and planning
• You will receive all of the business’s profits
• You will find filing for tax simpler

Cons:

• Managing everything on your own could burn you out and limit your potential for growth
• If you hit financial hot water, you will be liable for settling any debts or arrears

Partnership

Combining forces with another budding business owner will give you double the startup as well as another person who is liable for the red tape as well as the financial aspects of the business. More often than not, two heads are better than one—forge the right partnership and you could see your business thrive from the get-go.

Pros:

• You will have twice the skills, perspective, and financial scope
• You will have another person who is responsible for the running as well as financial and legal aspects of the business

Cons:

• If you and your partner disagree on any aspect, this could cause the kind of friction that could derail progress and stunt growth

Corporation

As a corporation, you will separate your personal assets from your business assets. This means that while your company can incur debt and be subject to legal disputes, your personal finances and assets will remain protected. There are many different forms of a corporation to consider, some of which offer access to some pretty decent investment opportunities.

Pros:

• You will gain access to excellent capital options
• You will benefit from certain tax breaks
• You will be able to protect your personal assets

Cons:

• Corporates can be costly to form and run
• There can be a lot of red tape involved in the running of a corporation

Limited liability company (LLC)

This type of business structure is one of the most common options for new businesses. As a limited liability company (LLC), you will benefit from the legal protection of a corporation while also reaping the tax rewards of a business partnership.

Pros:

• The setup process is relativity straightforward
• You will gain access to a healthy choice of capital and funding options
• You will have a certain level of protection concerning your personal finances

Cons:

• Your investment options can be limited with an LLC
• You can be subject to fairly costly annual maintenance fees

Want more information on how to start an LLC? Our guide has you covered.

Weigh up the pros and cons of each business structure, taking your aims and goals into consideration. At this point, you will want to brainstorm a catchy business name to make it official and bring your brand to life.

Once you’ve decided on your brand-boosting business name, you secure the appropriate domain name.

6. Register your business and get the required licenses

The next step in your how to start a business journey is registering your business and getting any required licenses.

By choosing your business name and settling on your business structure, you will have already started the registration process. To complete the registration process and obtain the right licenses, you will need to:

• Check the full registration requirements depending on your legal structure
• Work though the registration requirements of any regions where you’re looking to trade or operate
• Register for any taxes
• Obtain an employee identification number (EIN)
• File any relevant trademarks
• Find out which business license is relevant to your organization and start the application process

7. Open a business bank account

With your business almost up and running, you’ll need to open a bank account. In 2023, there is no end of choice when it comes to setting up a business bank account.

You should choose a bank account with benefits and features that suit your business’s size as well as your goals.

Tip: Create a shortlist of business bank accounts with flexible loan options as well as excellent customer service and online banking applications.

To set up your business bank account, you will need:

• Official business formation documentation
• EaIN or tax ID numbers
• Your official business name and location
• Date the business was  set up or established
• Your  Social Security number, address and date of birth

8. Get business insurance

In addition to opening your bank account, you will also need to get business insurance. If you don’t, you could find yourself footing a colossal bill if any unexpected issues, damages or disputes arise.

Even as a small business, you will need to cover yourself with the right kind of insurance to protect yourself against any eventuality. At the minimum, you will need general liability insurance (GL) to cover you for loss, injury or damage to yourself or a third party.

If you’re offering a service rather than tangible goods, it will also pay to get professional liability cover incase of any consumer-facing mistakes you might make. Also, as your business scales, you might also consider employment practices liability insurance. This type of cover will protect you against any potential employee claim or complaint.

9. Build your website

At this point, you will be ready to build your website and bring your business to life. Your website or online store will be the digital hub of your entire business—so getting the design and the functionality just right is essential.

If you’re interested in starting a website for your business, here are some hand-picked resources to help you out:

Tip: To build an online store that is slick, wonderfully designed, and easy to navigate, try the powerful and easy-to-master GoDaddy website builder. Or build an online store with our slick and savvy ecommerce tool. And tie your business together with a GoDaddy POS system to accept payments anywhere.

10. Launch and grow your business

“There’s no shortage of remarkable ideas. What’s missing is the will to execute them.”—Seth Godin

If you’ve followed all of the steps in this how to start a business in 2023 guide successfully, you’ll be ready to launch.

Once you build a buzz about your big business launch across various channels including email and social media, you can start selling and take measures to grow year on year through marketing campaigns and sales initiatives.

Starting a business in 2023 is a challenging but potentially rewarding venture. Be persistent, play to your strengths, take the time to ensure you’ve covered every base, and you’ll be winning on the commercial battlefield in no time. Best of luck.

FAQs:

How can a beginner start a business?

A beginner can absolutely start a business. As long as you have a clear idea of your goals and a passion for what you do, you can make your business a real success. Follow the steps in this guide and you’ll be up and running sooner than you might think.

How much money do you need to start a business from scratch?

The cost of starting a business will vary depending on your industry or business model of choice. But, research from the US Small Business Administration shows that most small businesses cost around $3,000 to get started. And, the majority of home-based ventures cost $2,000 to $5,000 to set up.

Can I run a business by myself?

There is no reason that you can’t run a small business by yourself. With the right resources and the right approach, you can set up, launch, and operate your business. Going solo is more than possible, but with so much to consider it’s a huge undertaking. As your business scales, hiring a small team or getting a partner on board will be a good idea. That way, you can further accelerate your commercial growth.

How do you create a legal organization?

To move your business idea into a legal organization, here’s a quick rundown of what you’ll need to do. First, come up with a unique name for your business. Next, figure out what kind of business structure works best for you, such as a sole proprietorship, partnership, LLC or corporation. Once you’ve got that sorted, pick a good location for your business and make sure you’ve got all the necessary permits and licenses. Then, get all your paperwork in order and register with your state. After that, it’s time to set up your financials, like opening a company bank account and staying on top of your taxes. Just remember, forming a business can be a bit complicated, so it’s always a good idea to chat with a tax advisor or lawyer to make sure you’re doing everything right.

What is the easiest business to start?

A service-based business is often considered the easiest to start as you don’t have to deal in physical stock or inventory. But, in 2023, it’s never been more accessible to set up and launch a successful online business. In the digital age, tools exist to help you set up an ecommerce store or build a website without technical expertise. Follow the right steps and almost every kind of business will be within your reach.

What is the simplest legal form to start a business?

A sole proprietorship is the easiest business legal structure to set up. If you have a little capital of your own, you can apply for a sole proprietorship with ease. You will have complete control over the entire business, but be aware: you will be responsible for the financial as well as legal aspects of the business.

Products mentioned

If you want to step out of the corporate office, stop commuting, work independently of location and become your own boss, you may want to start an online business. If you are ready to take the plunge, peep this post to learn how to start an online business.

Here’s what we’ll cover:

Ready to dig in? You can do this!

Research online business ideas

To make your online business succeed, you need to make money. So, the first step in starting your business is deciding how you will generate revenue. When it comes to online business ideas, you have a few options.

Sell products online

Over the past few years, people have grown more comfortable shopping from their couches, which means there’s never been a better time to start an online store or add ecommerce functionality to your website. It’s never been easier for small businesses to get into the ecommerce game, either.

If you’re an ecommerce noob, however, you may need help selecting the right products and platforms to sell online, learning how to build and launch your ecommerce site, finding your target customers, and closing the deal. We’ve gathered all the information and tools you’ll need to easily launch your online store and list your products on all marketplaces, both quickly and effectively.

Try dropshipping

Many first-time ecommerce entrepreneurs start their careers with no physical inventory. Through a process called dropshipping, you can act as a wholesaler of products that you curate on your site, then purchase directly from the manufacturer to ship to your customers.

Sell courses

Online courses that you create yourself or sell on behalf of others. Like digital products, online courses can be set to automatically deliver to customers upon purchase.

Start a blog and become an affiliate

Affiliate products that you sell on behalf of another business. When selling affiliate products, you usually don’t have to store or ship products. The merchant deals with delivery, and you simply receive a commission for helping sell their product.

Create a SaaS product

Software as a service (SaaS) is an offering that falls somewhere between a product and a service. If you develop software — say, like a scheduling app for small business — you can have customers sign up and pay a recurring fee to use the tech you developed. For this type of product, a platform with membership functionality helps a lot.

Offer services

You can start an online business based on selling consulting and freelancing services that are completed online or over the phone. When you sell services online, you can find customers and make sales on your own. Or you can sign up for sites that manage the process and allow you to connect with clients through their platform.

Choose a niche that works

The best product ideas are often born from hobbies and passions, where you discover an opportunity in a niche that no one is serving.

For example, pet products are always popular in the ecommerce sphere, but competition can be high. But if you choose a niche like organic pet products, there’s less sellers offering similar products and a greater opportunity to refine your catalog.

Search for keywords or phrases that your target market will likely use to find your niche product or service, and note if the market is saturated.

If that is the case, it could cost you extra money and time to stand out in an already crowded marketplace. Sometimes, it’s better to start small in an underserved market.

Check the online competition

Once you have positive product feedback, research your competition and gain market insight online.

Start by searching for and visiting popular product review sites, where you can find lists of top websites  for specific categories, compiled by experts. Read what the experts like and visit the websites to see how they’re doing it. Additionally, look at customer reviews to learn what people like and dislike about them.

Likewise, go on social media to see what people are saying. Do people complain about them, or do most of their customers sing their praises? This exercise will give you an idea of how much brand loyalty the competition has. Also, see if those brands respond to customer questions and complaints, and list what the common issues might be.

Subscribing to your competitors’ email lists is another effective way to analyze how they are talking to your target audience. Make note of their pricing and promotional strategies, which we’ll detail later in this post.

Research keywords and difficulty

Use a keyword planning tool such as Moz, Semrush or the Google keyword planner tool. These will show you search volumes for a particular keyword, as well as how much competition there is when it comes to ranking for it.

As you research keywords, it’s important to strike a balance between search volume and competition — there’s not much benefit targeting a keyword nobody searches, yet it’s best to avoid high-competition terms.

Check the SERPs

When you start getting your head around the keywords you want to target, plug some of them into a search engine and check the results. Note who’s at the top of the page — they must be doing something right, so pay a visit to their websites and ask yourself some of these questions:

• How are they incorporating keywords into the website text?
• How does the language they use establish their brand?
• Are there any design elements that jump out?
• What other things make this website special?

While you should never copy a competitor’s website, there’s nothing wrong with getting inspiration from it. Jot down notes that you can refer to as you continue to start an online business.

Create a business plan

A business plan can be like a roadmap that guides your business from starting to succeeding. And if you’re planning to apply for a loan or attract investors, a solid business plan is evidence that you’re a safe bet. At a minimum, your business plan should include these sections:

• Executive summary — Be brief in describing, from a high level, what your business will do or sell.
• Organization and management — Introduce key members of your team, and how their skills and experience will help you succeed.
• Service or product line — Describe your offering, how it works, and why there’s a demand out there for it.
• Marketing and sales — Explain how you’ll get your product or service in front of the largest possible audience.
• Funding request — If you’re seeking external funding, specify your needs and what the funding will support.
• Financial projections — State how much revenue you expect to generate. This can strengthen your case for funding.
• Appendix — If you have reference materials, technical specs or certifications, include them here.

Consider funding options

Unless you have that rich uncle everyone dreams about, you’ll need to secure funding before you successfully start an online business. There are a few routes you could take here:

• Secure a loan — If your business idea is compelling and you have a rock-solid business plan, you might persuade a financial institution to front you the startup funds. Just be sure to understand any interest and potential penalties.
• Attract investors — Investors also could show interest if you have a great idea and business plan to put in front of them. However, you might need to relinquish some control of your venture to accommodate them.
• Bootstrap it — This would be the most direct route. If you have savings, investments or other assets, using them to bootstrap your idea gives you total control. But you need to consider the ramifications if your business idea falls through.

Choose a business structure

Separate yourself from the business by setting up a C-Corp or LLC status that limits your personal liability for the company. This protects you and makes you appear more professional to customers and clients. Here are three structures to consider:

• Sole proprietorship — The business is nor incorporated, with a single person designated as the owner.
• Partnership — Two or more people are designated owners, contributing toward expenses and sharing profits.
• LLC — With a limited liability corporation, definitions can vary by region, but essentially the business exists without owners, offering legal and tax protection.

Separating your personal and professional finances will make it easier for you to file your taxes and keep an eye on your financial situation.

Once you establish your business as a separate entity, you can get a tax ID number for the business, allowing you to better manage your taxes and open a business bank account.

Check laws for online businesses

Here, you might need to source some professional advice or at least do some comprehensive research. Don’t start an online business only to discover there’s a law that creates a conflict leaving you dead in the water.

There’s likely a local government agency — such as a Department of Revenue — that could provide a checklist of applicable laws.

For example, in some regions there are very strict laws that apply to marketing to individuals online. And if you’re setting up an online store, it’s crucial to understand all the regulations that cover privacy and data protection.

Obtain permits and licenses

At the very least, you’ll likely need a license issued by your regional authority to start an online business. And if you specialize in a particular product or service, there might be additional permits or licenses you need to secure.

For example, a barber or stylist would need a license from their local cosmetological authority. And many home services require specific licenses or permits, for example, to excavate or operate heavy machinery.

Register a domain name

When choosing your ecommerce business name, consider something that is short, memorable, and marketable. A thorough search for a domain name can also help you find the right name for your ecommerce store.

The cost for a domain name can range anywhere from $2 to $20, but there can be hidden costs. Review this guide on how much a domain name cost for more details on what to include in your budget.

You might also consider using .shop or .store for general ecommerce, or get more specific with .jewelry, .clothing, .coffee and more.

Build your website or online store

Once you decide on a business model, you need to choose the best place to build your business online. How you make money online will dictate which platform you should build your business on. Choosing where to build an online business is just as important as learning how to start an online business.

Whether you plan to create a website or use an online store builder to get online, be sure to evaluate all your options, taking cost and complexity into consideration.

Target your main keywords

Do some research to discover what select words and phrases people use to search for your type of business. Sprinkle these keywords throughout the content on your website and create pages that focus on your target keyword. These might represent services — such as “lawn care” — or products if you’re operating an online store. Here it helps to check what the competition is doing to perform well in search results.

Create content that ranks and sells

Whether it’s a shareable infographic, entertaining how-to video, or blog post about why spending time in your online store is more fun than watching a favorite TV show, make content that people can’t find anywhere else.

This is the kind of stuff people will want to link to from their own websites and social profiles (remember backlinks?). Make sure they find that amazing content by optimizing it for search engines.

When it comes to content that ranks and sells, there are a couple main elements to consider: SEO and compelling product listings.

Search engine optimization (SEO): the process of refining a website to get higher search engine rankings and organic visitors to your site, without paying for search engine placement.

Unlike paid listings — advertisements that display in sponsored areas — organic search results are “free” and based on, among other things, the site’s content and how closely it matches the keywords being searched.

After you (or your website guru) does the website backend stuff needed to attract the attention of the search engine bots (like connecting the site to Google Search Console), search engines know that your site exists. They scan it, index the information, and analyze the website’s content to determine how and where your website’s content should display on search engine results pages (SERPs).

Compelling product descriptions that sell

Details can make or break a sales transaction. Since you don’t have a sales clerk to answer your customer questions on a website, start by thinking of all the questions they might ask that person in-store.

For example, what fabrics is a sweater made of? Is it organic and earth-friendly? Was it made locally? What other items might pair well with it?

Your descriptions should be as detailed as possible. However, being honest and upfront about it helps to build trust with customers.

Set up payment providers for ecommerce

The key to closing an online sale is to provide an intuitive and seamless checkout and payment experience.

Some platforms offer built-in checkout and payment processing tools. For example, GoDaddy’s Online Store enables you to securely accept all major credit cards, PayPal and Apple Pay — but not all service providers do. If you’d prefer to sell both online and in person, a solution like GoDaddy Payments is easy to set up and provides a high level of security for your transactions.

When evaluating options, you’ll need to consider:

• Does the platform’s merchant account accept all currencies and offer SSL certificates?
• What forms of payment can you accept through your account? Credit cards, personal checks, wire transfers, or money orders?
• How about PayPal or Stripe?
• Does your platform offer a payment gateway to verify, approve, and process charges in real-time?
• Does it integrate with your website’s existing platform?
• Do other merchants like or complain about the platform’s checkout and payment experience?

Review all your options and ask the platform provider about the associated transaction rates and processing fees. For example, GoDaddy Payments offers the lowest transaction fees compared to other leading providers.

Source products

If you’re planning to start an online business to sell products, having a reliable source will be essential. There are a few ways to consider locking this down:

• Find a supplier — A reliable manufacturer or wholesaler can keep you supplied, but inventory control (too much vs. not enough) can present a serious challenge, as can storage and transportation.
• Set up dropshipping — As mentioned earlier, dropshipping lets you sell while your supplier fulfills the orders. This might require specific technology to manage the supply chain once you get things moving.
• Supply it yourself — This option gives you the most control, but you need to think about your workforce. Doing everything yourself could be rewarding, until you find yourself scrambling to keep up with demand.

Build a brand

Even if you hire a pro to build your site for you, you’ll need to make (or at least approve) decisions about the look of the site — its design. Here are a few design fundamentals you’ll want to consider:

Logo. If you don’t have a logo or would like a new one, try our logo maker, where you can make a new logo in a matter of minutes. Once you have it, think about how you want to incorporate your company logo into your website’s design.

Colors. For brand harmony, it’s important to choose the right color palette for your website. Do you own a creative company? Perhaps vibrant colors like hot pink and tangerine speak to your brand. If you’re in the professional services industry, more subtle hues such as charcoal and blue might be more appropriate.

Think about the feelings colors evoke for you and match them with how you want your customers to feel when they visit your website.

Fonts. Think about the fonts that might best represent your particular business — from bold, linear styles to more delicate, feminine fonts.

Layouts and more. Consider the amount of “whitespace” (space between elements) in your design. A lot of whitespace can denote clarity or simplicity, while having very little of it can make your site look active or intense. Other elements, like background colors, gradients, and the “texture” of your overall design, can contribute to your online impression.

By putting a little thought into these basic design elements, you’ll make big strides in telling your story, building your brand, and framing your products and services in the best possible light on the web.

Related content: How to Make a Logo

Market and grow

Once you have a product or service to sell, a place to sell it and the peace of mind that you are operating legally and strategically, it’s time to get some customers and get to work. Tell family and friends, market yourself and seek out potential clients and customers.

Here are a the main ways to market your online business:

• Organic search — Learn the basics of SEO and get your content to rank higher.
• Paid search — Discover and bid on keywords to display your ads in related searches.
• Social media — Build a following and promote your online business on social media.
• Email marketing — Curate subscriber lists and develop email marketing campaigns.
• Online reviews — Monitor review sites and work to ensure you hold a high rating.
• Word of mouth — Network in person to build awareness of your online business.

The perk of having an online business is that you can take your work with you just about anywhere. But one of the best perks is that your online business is accessible to a massive audience of potential customers.

So, set up shop and get to work on building, marketing and growing your online business.

FAQ

What kind of business can I start online?

While the limit is your imagination, in this post we’ve covered some of the more popular types of business to start online:

• Ecommerce store — Set up an online store and process sales through your website.
• Dropshipping — Have a third-party supplier fulfill the orders you generate online.
• Online courses — Charge people to access learning material you post online.
• Affiliate marketer — Build a following and sell another business’ products to visitors.
• Create a SaaS product — Develop software and charge a fee for access to it.
• Offer services — Services such as counseling or teaching can be delivered online.

How do I start an online business with no money?

Starting an online business with no money can be a challenging task, but it is possible with the right approach and mindset. Here are some steps you can take to get started:

• Build a website — Use a free website builder to create a professional-looking website for your business.
• Use social media — Take advantage of social media to promote your business and reach potential customers.
• Network — Connect with other entrepreneurs and professionals in your industry through online forums, groups, and events.

Starting an online business takes time, effort, and persistence. Stay committed to your goals and remain flexible in your approach as you adapt to new challenges and opportunities.

What kind of online business is most profitable?

The most profitable one depends on various factors such as the target audience, the niche, and the business model. Here are some examples of profitable online businesses:

• Ecommerce — You can create your own online store or sell your products on marketplaces like Amazon, Etsy, and eBay.
• Online education — Platforms like Udemy, Skillshare, and Coursera allow instructors to create and sell courses.
• Affiliate marketing — Many bloggers and content creators use affiliate marketing as their primary source of income.
• Digital marketing — Provide digital marketing services like search engine optimization (SEO), social media marketing, and email marketing.
• Software as a service (SaaS) — Examples of successful SaaS companies include Dropbox, Slack, and Zoom.

It’s important to note that the profitability of an online business depends on various factors such as the quality of the product or service, the target audience, and the marketing strategy.

Which online business is best for beginners?

There are many online businesses that are suitable for beginners, depending on their interests, skills, and resources. Here are some ideas:

• Dropshipping — Set up an online store and sell products without holding inventory. A third-party supplier ships the products directly to your customers.
• Affiliate marketing — Promote products or services on your website or social media platform and earn a commission on each sale made through your referral link.
• Blogging — Start a blog and create content around it. Once you have built up an audience, you can monetize your blog through ads, sponsorships, or affiliate marketing.
• Online courses — Create an online course and sell it to people who want to learn the same skill. You can use platforms like Udemy or Teachable to host your courses.
• Social media management — Offer your services to small businesses or individuals who need help with their social media presence.

Ultimately, the best online business for beginners is one that aligns with their skills, interests, and goals. It’s important to do your research, understand the market, and be willing to put in the time and effort required to succeed.

I used to think that every “brand” was supported by its own factory and an army of in-house employees. I was wrong. Branding your own product doesn’t mean you need to design and manufacture it yourself.

Of course, most brands partner with factories, freelancers and agencies for extra support. But many others use white label designs straight from a factory. Here’s how it works:

1. You find a manufacturer with a product design you like
2. Add your brand name on it
3. Sell it as your own

Sometimes there’s simply no need to design a product from scratch. There are plenty of well-designed products out there that just need a brand to sell them.

Where can you source white label products?

You can use sites like Alibaba and AliExpress to find pre-designed products ready for your brand name. No need to invest in product development, which can take months (or sometimes years) before a final sample is ready for production.

This Reddit post shows you how to use Alibaba or AliExpress to build your own brand step-by-step with just $1,000, a little imagination and a healthy amount of drive and ambition.

White labeling gives you so much freedom compared to reselling other brands’ products.

It can be the stepping-stone you need to put your brand on the map — even if you do end up reselling in the future or invest in R&D for products down the line.

1. Building your own brand means having control

When you buy stock from other brands to resell on your website, you’re not in control. They are able to dictate things like:

• The price you pay
• Whether you can discount it and for how much
• How you can and can’t market it

When you start your own brand, you have control. If you source directly from a factory, you can afford to drop prices to undercut competitors, while still making large margins. The tough design decisions have already been made, but you still get to make the product yours by customizing its look and adding your branding.

Where the brand goes in the future is up to you — it’s your adventure!

2. It reduces competition

Selling other brands’ products seems like an easy way to get rich. But often, you end up competing against other companies selling the exact same products. It’s not easy.

When starting your own brand, you’re the only one selling the products with your name on them, so you can build your own reputation.

For example, if I sell Beats headphones, I have to compete against all the big names already selling them. Those bigger companies can undercut me because they buy the headphones in bulk, which means they can sell them at a cheaper price.

So without competitive pricing, I could be crowded out of the market altogether. There’s just no way for a one-person company to achieve meaningful success by selling Beats headphones.

That said, if I launch my own brand of headphones called Nick’s Brilliant Headphones, I’ll still be competing against other companies making headphones. However, I’ll be the only person in the world selling Nick’s Brilliant Headphones.

With proper branding, some good reviews and the ability to maintain a good reputation, I could be on my way to the top.

3. It’s a stepping-stone to success

Perhaps you’ve heard of the popular saying, “Mighty oaks grow from little acorns.” The understanding of this quote means that sometimes something grand can stem from a small venture.

It doesn’t matter if you start out selling water bottles you bought on Alibaba, then rebrand them in your living room. After all, Jeff Bezos started Amazon out of his home.

The biggest brands have humble beginnings. There’s no telling how far you’ll take your brand once you get off the ground.

You could be importing en-masse from factories this year, developing your own products the next and building your own factory in five to ten years. As your brand reaches more people, it’ll gain recognition and loyalty. You’ll be able to take the brand wherever you want from there.

Importing products and adding your brand name to them may seem primitive, but it’s the first step to success and ownership over your future.

4. You can become the distributor

Today, you might approach Beats by Dre to resell their products. But instead, imagine if people approached you to sell your product?

You still get a cut of every sale, but you also get the following perks:

• Increased brand exposure
• Added benefit of a new revenue stream
• No burden of selling to customers all by yourself

You can go from begging other brands to let you work with them to the person whose products everyone else wants to stock.

I know several companies whose products are stocked in brick-and-mortar stores — and they all tell me it adds cushy extra income. There are always people who prefer to shop in a store or buy important last minute purchases in-person so they don’t have to wait for delivery.

5. Increase profits by cutting out the middlemen

If you resell products from an existing brand, you pay a wholesale fee to them. This helps cover their margin, plus the cost of the product, but may leave you with a lower profit.

If you start your own brand and sell it online, you only pay the manufacturing costs and any import and shipping fees.

That wholesale fee you would’ve paid another brand is money in your pocket.

You can then afford to undercut other sellers of similar products, while still maintaining a great margin.

It’s time to build your own brand

There are many merits to selling other people’s products. But the advantages speak for themselves when you have:

• Time
• Determination
• Personal drive to start and build your own brand

And with white labeling, it’s easy to get started with a small investment.

Save the time and effort of marketing someone else’s products and promote your own instead. It could be the start to your brand becoming a household name.

Have thoughts on building a brand? Share them in the comments!

Image by: Mediamodifier on Unsplash

If you plan to launch an ecommerce store this year, you’ll need a strategic sales and marketing plan to help you stand out. You’ll also need to know where to source the best products if you don’t manufacture them yourself. These types of businesses need to know how to find products to sell online.

The competition for online consumer traffic and sales has never been steeper. Many small businesses (SMBs) have recently launched ecommerce stores to reach customers who prefer to shop online, with 92% of online SMBs claiming they had a significant sales growth in 2021.

How to find products to sell online

Let’s explore how to find products to sell online and ensure they fit with your overall business strategy and budget.

1. Identify products that you’re passionate about

It’s essential to have a profitable small business. But it’s hard to stay committed to it long-term without a passion for what you sell.

As you embark on your online business journey, start by identifying those passions. Do you love books, fashion, food, jewelry, or technology? Do you have a hobby, like buying art or collecting dolls, that you’ve always wanted to turn into a business by helping others do the same?

More than 65 percent of participants in a Customer Thermometer study said that “being emotionally connected to a brand made them feel like the company or business cared about people like them.”

So the more you’re able to align with and communicate your passion for your digital or physical products through your online business, the better you’ll attract like-minded, loyal shoppers.

It’s also critical to think about what the products that you want to source and sell will say about your business and brand.

For example, if you decide to sell organic, fair-trade coffee beans, you’re promising to deliver a product that is healthier for your customers while showing that you care about the people who grow and package that product.

If your potential customers also care about those values, you know they’ll be looking for a site like yours to purchase those products.

That’s why you must identify the right product niche and target market before you source the products you want to sell online.

2. Align those passions with a niche product-market fit

Business News Daily defines a product niche as “a specialized or focused area of a broader market that your business serves specifically.”

Taking the time to identify your niche properly will help you to stand apart from your competitors in a crowded online marketplace.

For example, if you love jewelry inspired by or from the 1920s and 1930s fashions but can’t find it all in one place online, you could build a small business that caters to that niche.

Or, perhaps you want to sell trendy costume jewelry for young women to wear to work. It all comes back to your passions and which customers you want to target online.

When choosing and searching for your niche items to sell online, you should also consider:

• The size and weight of your physical products: To keep shipping costs down with lighter and easily packable products
• The selling price of your sourced products: Especially when getting started — to be profitable and to cover the cost of returned items
• Product durability and quality: You don’t want products to spoil or get broken en route to your customers
• Trends in your chosen niche: For example, search terms for “nostalgia” have grown over the past few years and is reflected in everything from current fashions to music, TV, and toys

Profiling your niche customers

Try to get as specific as possible when defining your niche target customers. Include everything from demographics like age range, occupation, and household income to psychographics like their personality traits, lifestyle, special interests, and values.

Using the costume jewelry example from earlier, your target customer could be a single woman in her 20s and 30s who works in advertising or PR and makes $30,000 to $75,000 a year. She likes to go out with her friends after work, belongs to a book club, is a foodie that watches baking shows, and cares about climate change and product sustainability.

Once you’ve completed your customer profile, research how they’re likely to shop for your products online. Small business owners can start by reading free blogs and consumer studies published on online marketing sites such as eMarketer, Econsultancy and MarketingCharts.com.

You can also get a lot of free information from ecommerce news sites like Retail Dive, Digital Commerce 360, and the National Retail Federation.

Look for trends that reveal where your potential customers spend most of their time online and try to learn how they discover new products.

For example, are they more likely to research vintage jewelry through search or fashion and celebrity websites? Do they follow influencers on social media sites like Instagram and Pinterest? If so, which ones and what are those influencers saying about those products and styles?

You can also send out an online survey to friends and family who fit your niche customer profile using Survey Monkey or Google Forms. You can ask them specific questions like:

• What do they love about that product niche?
• Which niche product trends are they looking for right now?
• What products in that niche are they most likely to research or buy online?
• What’s missing from that niche market that they’d like to see filled?
• How much would they be willing to spend on a specific niche product?
• Where do they typically learn about new niche products online?
• Which competitor sites do they currently buy from, and what do they like or dislike about those ecommerce sites?
• Do they buy their niche products from local, national, or global competitors?
• Would they prefer to have products shipped to them if they buy locally, or would they like to purchase products online and pick them up in-store?
• If they buy products nationally or globally, how much would they be willing to pay for shipping?

Giving them specific answers to choose from, rather than asking them open-ended questions, will make it easier for them to fill out your survey. Although, a combination of the two is often necessary.

It’s also helpful to offer an incentive to get them to complete your survey, like gift cards and discounts when shopping with your online store.

Once you have all of your answers, it’s time to look for the right products that meet all of their needs.

3. Find the right products to sell online

As you prepare to source your physical products, think about the type of ecommerce business you want to create.

For example, many small business owners start with a dropshipping business model where you don’t need to make or store any inventory yourself physically. Instead, you’d source and curate the niche products on your site while your suppliers would store, package, and ship the items for you.

With a dropshipping business model, your suppliers will take a bigger cut of the profits.

However, dropshipping is a flexible and scalable way for a small online business to get off the ground quickly and affordably, with lower overhead costs.

As your business grows, you can potentially add your own manufactured products to sell on your site to make a larger profit.

Identifying products for your dropshipping business

Where you source your dropshipping products depends on your chosen product niche.

According to SixAds.net the top dropshipping niche categories last year were:

• Home decor and home improvement
• Jewelry
• Health and beauty
• Fitness
• Pet products
• Boho clothing and accessories
• Phone accessories

To find the top trending niche products right now, SixAds recommends looking at:

1. The top Amazon Bestsellers for your niche product category.
2. eBay Watch Count to see what the top eBay shoppers are adding to their “watch list” by keyword.
3. The SaleHoo Market Research Lab uses data from Amazon and eBay to help you find highly profitable dropshipping products to source and sell.
4. Google Trends: Since most people start their shopping journey with a search, you can look at growth trends for specific product keywords over time.
5. AliExpress Dropshipping Center to discover the top niche products to source and sell online via AliExpress.

Sourcing those products via dropshipping suppliers

You have many options to choose from when sourcing products for dropshipping.

Access a network of sellers via ecommerce marketplaces

One of the most common places to start sourcing your products is via an ecommerce marketplace that connects you to a large network of manufacturers and sellers. As mentioned earlier, the AliExpress Dropshipping Center is a good place to start.

Additionally, you can research and contact niche dropshipping marketplaces like BrandsGateway for luxury brands, Buy2Bee for clothing and footwear, UniqBe for IT and electronics products, Gold-N-Diamonds for jewelry, and Wholesale Interiors for furniture.

Choose high-quality niche products via wholesale supplier directories

Directories like InventorySource.com give you access to thousands of high-quality wholesalers and suppliers for niche product categories.

Keep in mind, however, that they charge a monthly subscription fee to integrate and automate the SKU data onto your site. However, some let you look at the content for free to decide whether or not you want to invest in a subscription.

Go straight to the source with brand manufacturers

You can also go straight to your favorite niche brand manufacturers to negotiate a dropshipping partnership. Keep in mind that not all of them will be interested in dropshipping, and this can become a laborious process as you add more partnerships.

Be sure to ask about their revenue share model (e.g., how much of the sales revenue they would keep to store and ship the physical product to your customers), and compare prices among a host of your favorite niche brands.

You’ll need to factor that number into your price, along with the manufacturer’s suggested retail price (MSRP), to make a profit. Refer to our post on product pricing for help when developing the right ecommerce sales strategy for your small business.

Enable manufacturers and sellers to come to you

You can also make it possible for niche product creators to post and sell their wares through your site.

For example, Society6 created a platform for artists to affordably upload photos and sell their designs (e.g., prints on mugs, t-shirts, and socks) to the world. In this way, artists can reach out to them and post their own products on the ecommerce site.

Sourcing products for your general online store

If you already own a retail store and plan to launch an ecommerce site, or you’re an online retailer that buys commoditized physical products (e.g., high-demand, essential items) and/or niche products to store in a warehouse, then you have some additional options to consider.

In addition to the resources listed above for dropshipping sources, you can purchase your niche products from ecommerce marketplaces like: Alibaba.com and Amazon wholesale. You can also purchase inventory from wholesale partners like Costco.

To decrease your overhead costs, since you’re renting out a physical warehouse and covering your shipping costs, look for discounts when purchasing large product quantities in bulk.

Additionally, keep in mind that suppliers are currently dependent on manufacturing capabilities during the Covid pandemic. Check-in regularly with your suppliers to make sure you don’t frequently sell out of items and keep customers waiting for long periods.

Related: Top-notch shipping tips for your online store

4. Identify and integrate online product sales channels

Once you’ve sourced your digital or physical products, it’s time to decide where and how you’ll sell to customers online.

First, you’ll need to develop and launch your online business website. If you don’t have one already, there are a variety of options out there and many ecommerce platforms, like GoDaddy Online Store, can help you to:

• Buy a domain name
• Build your site with affordable mobile-friendly templates
• Process payments quickly and securely
• Host it all on one integrated platform

Use GoDaddy Online Store to build your site and sell everywhere

If you’ve already done your research on where customers are likely to discover and buy your products online, working with GoDaddy will enable you to sell directly from your website or your customers’ favorite platforms and marketplaces, like eBay, Etsy, Amazon, Facebook or Instagram.

Plus, GoDaddy Online Store integrates with GoDaddy Payments to help you process payments securely — both online and in-store.

Your payments will arrive in your business account as soon as the next business day, and GoDaddy offers the lowest fees in the industry per transaction, compared to leading competitors.

GoDaddy Payments processes all major credit and debit card transactions — both online and using our POS devices. If you use our Smart Terminal and Card Reader devices in-store or in-person, we also provide contactless payments via Apple Pay and Google Pay.

Finally, you can access all of your orders, inventory, reviews, and customer emails — across all of your online business sales platforms — from one easy-to-use online dashboard.

Add WooCommerce to our managed WordPress ecommerce platform

If you already have a WordPress website and want to add ecommerce functionality, you can do so using WooCommerce extensions — choosing from over 50,000 WordPress plug-ins and  10,000 site design templates.

GoDaddy’s managed WordPress Ecommerce platform with WooCommerce gives you the freedom to sell anything, anywhere online — from physical products to digital downloads, services, and subscriptions.

It also seamlessly integrates with GoDaddy Payments, giving your customers more ways to pay you, and helping you get paid faster.

Related: 6 types of products you can sell with WooCommerce

Launch, test and iterate on what’s working

Once your site is live, it’s important to track how each product is performing on your website, so you can offer more of what your customers want, and consider removing products that aren’t driving sales.

First, you’ll need to install an analytics tool like Google Analytics on your site to track your customers’ online shopping behaviors. For tips on what to track and which reports to use, read:

How to use Google Analytics enhanced ecommerce features to gain more customers.

Next, consider using A/B testing on your homepage, product pages, and check out to see which design features and copy can be improved to increase sales (or conversions) on your site.

Essentially, A/B testing is a split test between two variations of the same page. At the most basic level, you can test whether a checkout page with a green button will outperform a red button to drive more sales. However, you can get a lot more sophisticated with what you want to test.

Related: The what, why, and how of WordPress A/B testing

5. Your online customers are out there

Once you’ve found the right digital or physical products to sell online and launch your ecommerce site, it’s time to build your brand and promote your online business.

From search engine optimization (SEO) to email, social media marketing, and online advertising, the GoDaddy blog can teach you how to launch, market, and advertise your small business ecommerce site to potential customers.

We also cover case studies on how businesses like yours are succeeding online and provide insights into consumer behaviors, seasonal strategies, and more.

If you don’t have a large budget, start with one or two marketing strategies that you know are likely to reach your potential customers and convert sales, based on your consumer research.

Then, test and improve on what works. As your business grows, so too can your budget to drive more traffic and sales to your site.

Over the past four years, the print-on-demand (POD) industry has grown by 12%. And if you think it’s slowing down, think again. With the growing demand for one-of-a-kind and customization, 36% of consumers have expectations for personalization, and 48% are willing to wait longer for them to arrive.

While running a print-on-demand business has its ups and downs, it can be a very profitable business. Know the pros, cons, and tips before selling print-on-demand products to ensure you’re prepared and well-equipped to run your business.

What is print-on-demand?

Print-on-demand is a process where you work with a supplier to sell white-label items with customized designs under your own brand name. Selling POD products is ideal if you are starting an online business. How so? The fulfillment method takes place per order and begins as soon as customers complete their orders.

Some common print-on-demand products include T-shirts, hoodies, baseball hats, tote bags, yoga pants, engraved jewelry, and mugs.

T-shirts, in particular, are the most popular — with a marketing value of $3.64 billion in 2020. Print-on-demand T-shirts are becoming a part of a corporation’s business strategy to market its company, products, or offerings.

But like any type of ecommerce business you encounter, there are pros and cons to the process of selling POD products.

You don’t want to be in charge of full customization — designing merchandise from start to finish. By opting to print-on-demand products instead, you won’t have to. POD is cost-efficient, involves lower lifting, and allows you to have control over what your products look like.

Pros: 3 benefits of selling print-on-demand products

Print-on-demand products are ideal for sellers who are short on time. You let a third-party platform handle storing, shipping, and fulfilling inventory, among other tasks. In turn, you can focus more on the creative aspects and marketing your brand to gain more customers and sales.

1. Design customization is simple

Design customization is easy because print-on-demand platforms handle making the product variations. As a seller, all you have to do is upload your product and offer designs for customers to choose from.

And if customers are looking to add their name or specific lettering to a product, great, you can do that easily through your POD provider.

Merch38, for example, is a print-on-demand service provider. It aims to help sellers help people express themselves through ultra-personalized clothing.

Below, you can see how Merch38’s platform offers a variety of printing locations for a white-label hoodie — front, back, or both.

 

The variety of printing location options on the clothing allows buyers to make their hoodie one-of-a-kind.

2. No required investment in your own inventory

Unless you’re still selling non-print-on-demand items, we have good news for your business. The days of storing a load of your own inventory are over. That responsibility is on your POD platforms, too.

For POD products, inventory is ordered on an as-needed basis. That means you don’t have to worry about keeping old items that will likely go to waste.

Fortunately, the best-selling products used for print-on-demand are popular in the selling market, so there are typically many vendors to choose from. So thankfully, you’re not limited to a specific vendor that may or may not have your product available when ready to order.

Not having to invest in your inventory is a gift from the heavens, especially if you are a new business with limited capital. The reduced overhead allows you to test the market with different designs and lowers risk.

3. Freedom from the responsibility of fulfillment and shipment

As the seller, your main focus is attracting customers to your website to make purchases and grow your brand. Leave the logistics of fulfillment to your print-on-demand platform.

With the right supplier on your side, they’ll deliver fast results — leaving your customers satisfied and ready to continue doing business with you.

Since you won’t have to worry about fulfillment and shipping, you can focus on fostering stronger customer relationships to ensure customer satisfaction. According to Forbes, costumes are glad to pay 17% more for products from businesses with excellent service.

Also, those who leave satisfied are five times more likely to make a purchase again and four times more likely to make a referral.

Cons: 3 print-on-demand product challenges to keep in mind

Print-on-demand providers helping your business are great. But at the same time, they cut into your pockets. You can’t keep all the profit you generate. Rightfully so, some of the gains go into the hands of those who are helping keep your business afloat.

So before you go all in, take a moment to consider some of the challenges below before including print-on-demand products into your inventory.

1. Order fulfillment can take a long time

Because print-on-demand products are made after a customer purchases, the process to create and deliver will take longer than shipping an item that is already completely made.

Between you and your buyers, be the first one to set the expectations for your buyers. Reduce the number of customers reaching out about estimated times of delivery. Make a visible note on each product or checkout page to notify customers about the extended delivery times.

The more information they know ahead of time about their purchase, the more patient they will be when waiting for their customized products to arrive at their door.

According to Printful, a typical POD order can take two to seven business days to fulfill.

On the other hand, fulfillment for non-print-on-demand products can be at customers’ doorsteps much faster. Through Amazon Prime’s Same-Day Delivery, for example, consumers can expect their merchandise to arrive the same day they purchase.

2. Profit margins are low

Because print-on-demand products are often custom, you can’t buy items in bulk for wholesale pricing. As a result, profit margins are lower than non-print-on-demand items.

And unfortunately, because your printing company handles shipping and handling, a large part of your profit goes into their hands.

But to help make bigger profits, consider negotiation shipping rates with your supplier.

3. Returned items are hard to resell

Because print-on-demand items are tailored to individual customers, it can be challenging to resell returned items.

To decrease the number of returns, add a sizing chart and encourage previous customers to leave reviews with photos modeling the product. Have them include measurements and the size they purchased to offer as much accuracy as possible for the next potential buyer.

To decrease the number of items coming back to you, ensure your third-party provider is on the same page about return policies.

4 tips to generate sales for print-on-demand products

As a print-on-demand product seller, you’ve got the advantage of easy customization. Embrace that aspect of print-on-demand to win over shoppers. At the same time, you have to work extra hard to maintain quality because your print-on-demand platform controls so much of the ecommerce process.

By implementing the four tips below after starting your POD business, you’ll be able to gain more recognition, be confident in the products you sell, and ensure higher customer satisfaction.

Tip 1: Give out swag to generate public awareness

Swag is promotional merchandise — goodies like mugs, T-shirts, notebooks, pens — you name it.

It’s common for companies to give these particular products to new hires or pass them around at trade shows to increase brand awareness. And as a print-on-demand product seller, you can give customized products to your existing and potential customers to generate leads.

You have the tools and processes to do so easily, so why not?

Not only will your invested gifts to customers encourage them to come back for more, but they’ll turn into walking billboards whenever they rock what you gave them.

Tip 2: Order samples to check for quality

It can be easy to go without seeing your products since they go straight from your print-on-demand provider to customers. Create a habit of ordering samples beforehand to ensure you’re offering excellent quality.

It’s also good to order samples because what you see online doesn’t always match the real deal in person. So seeing the quality of products for yourself before customers purchase will boost your confidence in selling them.

Tip 3: Send surveys to customers to discover satisfaction level

The opinion on your products shouldn’t stop at what you think about them. Reach out to customers to see what they think about purchasing. Based on their feedback, you’ll know if you should continue with the same suppliers or switch to someone new.

Also, because you may be in the dark about the fulfillment and shipping services between your print-on-demand supplier and customers, you can send surveys for that too as a way to check on how well your POD provider is doing.

Tip 4: Create POD content to drive website traffic

Through print-on-demand content creation, you can distribute consistent, relevant, and valuable information on your website that connects to the unique products you sell. And according to WPForms, small businesses with blogs get 126% more lead growth compared to those that opt out.

Include blog posts on trending print-on-demand items — including the ones you sell. With a strong content strategy and SEO efforts in play, your brand’s writing piece can make its way on Google’s search engine results page.

In addition to blog posts, share Twitter threads about print-on-demand products, benefits of selling, customer success stories — linking your content back to your store’s website.

The more information you offer, the more knowledgeable you will seem. With those two factors in play, you’ll likely attract new buyers.

Offer a variety of print-on-demand products to grow your business

Print-on-demand products not only allow you to play around with different designs, but you can also explore different products to expand your offerings.

If you’ve been selling customizable T-shirts and they have been selling quickly, you may want to consider venturing out to similar items like long-sleeve shirts or hoodies (especially when seasons change).

Shift your mindset to be data-driven to experiment with new products. Throughout the process, you’ll discover what additional print-on-demand products are worth keeping and which are not adding value to the business.

The moment you sign up as an Amazon seller, the clock starts ticking. Amazon will hold you to its monthly performance metrics from day one. And being prepared makes all the difference: with this checklist, you’ll be ready to ace every step of selling on Amazon. We’ve covered everything from the most basic preparation to the next steps necessary to grow into your success.

How to get started selling on Amazon

To start selling on Amazon, you’ll need to start with these steps:

1. Gather your paperwork.
2. Figure out the logistics.
3. Prepare your business plan.
4. Register your seller account.
5. Create product listings.

Let’s start selling.

1. Paperwork you need to start selling on Amazon

It’s a lot easier to start selling with your paperwork in order.

Some of this will be needed for the account opening process, some of it is common sense, and some of it helps to protect your business in the future.

You’ll need to start your Amazon store:

• Your business name: The name of your business. If you’re doing business as another name, things get more complex, but you’ll need this whatever you do.
• Email: You’ve got to have a valid email address. But I’d consider setting one up especially for your Amazon seller account – maybe add a new account to your business email or if you don’t have one, open a fresh Gmail and keep signed in on an alternative browser so checking it regularly is easy.
• Credit card: You’ll need to have the credit card you’re going to use for your business handy and solvent.
• Tax ID and State Tax: You’ll need your tax ID. If you’re selling as an individual, have your Social Security number handy; if you’re selling as a company, you’re going to need your company’s
• Federal Tax ID number: When you’re in the process of signing up to your Amazon account, you’ll need to fill in a 1099-K Tax Interview document.

If you’re not based in the United States, you might be asked for this in error; contact Amazon and it should be cleared up in a couple of days.

State Tax ID information is only needed for states in which you have a physical presence (‘nexus’). If you have an office in Arizona, a warehouse in Nebraska, and a factory in Minnesota, those are the states you need State Tax ID info for.

If you’re planning to use Fulfillment by Amazon (FBA), there can be other tax issues. For a single seller with a single location, FBA tax is simple. But for a multi-state entity, it can get complex.

If that’s you, it’s cheaper and simpler to talk to a specialist tax attorney or adviser before you start selling on Amazon, in the same way that it’s far cheaper to have a good accountant than muddle through it all yourself. (Small business owners know what I’m talking about here!)

Companies that specialize in Amazon tax issues include:

• Taxjar.com
• Avalara.com
• Taxify.co
• Vertexsmb.com
• FBAsalestax.com
• Zip-tax.com
• Catchingclouds.net

Yes, it’s just boring paperwork. But having it all set up before you start selling on Amazon is a lot less irritating than chasing it around on a time limit. And if you don’t have the tax info to hand to fill out your 1099-K, you won’t be able to sell on Amazon at all until you do.

This content should not be construed as legal or tax advice. Always consult an attorney or tax professional regarding your specific legal or tax situation.

2. Figure out your logistics in advance

Once you jump in and actually start selling on Amazon, fixing these logistical issues becomes much harder. It’s easier to set things up so they never become a problem in the first place.

You’ll need to know:

Your returns process:

Amazon has its own internal returns policy which you have to meet or exceed in order to be an Amazon seller. It’s a good idea to read this page, figure out what you’re going to do that’s at least as good as Amazon’s policy, and write that down somewhere, even if it’s a sticky note on your desktop. When you get an item returned, that’s the wrong time to be figuring out what to do about it – especially since you only have a 24-hour window to begin the process.

• How (and if) you plan to use FBA:

You can oversimplify and say: smaller items work with FBA, bigger ones less so.

FBA works very differently if you commingle your items. Commingled selling lets Amazon sell your items and those of other sellers interchangeably, assuming that the item is the same.

The problem with that is, you can end up with your products – which you have control over and have carefully verified – mixed up with someone else’s who hasn’t bothered checking, or is selling fake stuff on purpose. Then when an order of yours gets shipped, it’s their poor quality product that arrives – and your reputation that gets trashed.

There are benefits to this approach, but it’s risky. By and large standard practice should be, use FBA but don’t commingle.

• Whether you want to use a DBA name on your Amazon account:

Amazon lets you use a DBA (doing business as) name on your Amazon account, basically rebranding your Amazon account as something different from your main business.

There are plenty of legitimate reasons to do this – such as, you have a specific part of your business that takes place on Amazon. If you normally sell furniture of every kind but on Amazon you sell only wardrobes, Texas Furniture isn’t as good a name as Texas Wardrobes, for instance.

But there are also plenty of sketchy sellers on Amazon who use DBA to conceal the real identity of their company; you might have more credibility and trust if you just use your regular business name.

• How Amazon’s product gating applies to what you want to sell:

Amazon uses restrictions to decide who can sell things in certain categories. If the categories you want to sell are gated, you’ll need to apply for the ungating process as soon as possible. Check if your products are on the gated list here.

3. Prepare your business plan

Decide your business plan in advance. Don’t try to wing it.

Your answers to these questions might change, even in your first month as an Amazon seller.

But by planning out your first month, you force yourself to ask the questions.

At the very least, ask yourself:

• Are you going to sell the same products or change it up?

If you’re going to sell more opportunistically, or from a large range, this isn’t so much of an issue. But if you’re selling the same products all the time, it’s smart to take advantage of Seller Central’s replenishment alert.

• How will you identify stale inventory?

However you’re selling, keeping track of inventory age is an important part of handling your supply chain. If products are sitting on the shelf for three months, that tells you something about what you need to order.

More urgently, if you’re using FBA, it’s vital to identify stale inventory so you don’t get caught in Amazon’s 180-day inventory sweeps and charged a much higher storage fee. Don’t wait 179 days and then wonder how much of your inventory is now costing you money instead of making you money.

You can find Amazon’s inventory report under Reports > Fulfillment > Manage FBA Inventory if you’re using FBA. There, you’ll find a full real-time inventory report containing numerical values for a range of inventory data – SKU, product condition and so on.

• How will you source your products?

Inventory is a major issue on Amazon. Sellers who aspire to the buy box already know: you won’t get in if your product’s out of stock. You also need to avoid periods when you’re out of stock and not selling – and thus not making any money.

Only you know the most appropriate sources of inventory for your business, but make sure you have fallbacks if it’s possible so you don’t get caught out.

• Who is already selling the same products as you on Amazon?

It’s pretty common for new sellers to jump in with products that are already so popular, in such crowded markets, that there’s no real chance of successfully selling them. So it’s really vital to check that you’re selling something where you have a chance at actually making a business work.

The biggest competitor on Amazon is Amazon itself – check your intended catalog against Amazon and if the company itself is selling your products, rethink your approach.

Related: Product targeting — How to optimize exposure on Amazon

4. Register your Amazon seller account

So, how do you become an Amazon seller? You need to register an Amazon seller account.

There are two types of accounts: An individual seller account, with no monthly fee but a charge of 99 cents for each item you sell, or the pro seller account for $39.99 per month no matter how many items you sell. So, if you plan to sell only a few items per month, go with the individual seller account.

But, if this will be a larger venture, plan on using the pro seller account. If you want to sell on Handmade or Launchpad, you have to use a pro seller account, no matter how much product you are selling. You can change plans at any time.

For both account types, you can sign up with your existing customer account or you can create a new seller account with your business email.

Before you sign up, be sure you have these items ready:

• Business email address or Amazon customer account
• Internationally chargeable credit card
• Government ID (identity verification protects sellers and customers)
• Tax information
• Phone number
• A bank account where Amazon can send you proceeds from your sales

Amazon also collects a referral fee on each sale no matter the chosen plan, which is a percentage of the total transaction and varies by product category.

5. Create your product listings

You have your seller profile created, so now you need products. But, how do you put your product on Amazon?

First, you need to consider what you are listing — you can’t just list whatever you want. Some categories are open to all sellers, some require a pro seller account, some require approval to sell, and some include products that cannot be sold by third-party sellers.

So, consider what you are selling and make sure you have the appropriate account.

Once logged in, you’ll navigate to Seller Central to create your listing. To create your listing you’ll need:

• A product identifier, such as GTIN, UPC, ISBN, or EAN to specify the exact item you’re selling. You can get a UPC code directly from GS1, or request an exemption.
• A SKU, which is a product ID you create to track your own inventory.
• Details, including the price, product condition, quantity available and shipping options.
• Product details including name, brand, category, description, and images.
• Keywords and search terms.

If there is already an exact product match on Amazon, then you can match your listing so things like product identifier will already be in place. If you are the first, then you will have to provide those details.

 

Your offer details will be displayed on a product detail page, the page in which people see when they look at products on Amazon.

Here is what is included on this page:

1. Title: 200 characters max, capitalize the first letter of every word
2. Images: 500 x 500 or 1,000 x 1,000 pixels to increase listing quality
3. Variations in colors, sizes, etc.
4. Bullet points: Short, descriptive sentences highlighting key features and benefits
5. Featured offer (“Buy Box”): The featured offer on a detail page. Customers can add to their cart or “Buy Now”
6. Other offers: If you sell a product that is sold by multiple sellers, you’ll see the same product sold by multiple sellers offering a different price, shipping options, etc.
7. Description: Be sure to use keywords that will help customers find your product.

How to promote your products on Amazon

To profit as a seller, you have to stand out against over two million merchants. But if you do grab buyers’ attention, you’re bound to make sales since so many shoppers flock to Amazon. The average conversion rate in the marketplace is roughly 15%, roughly three to five times that of other ecommerce sites.

The key to reaching Amazon shoppers is maximizing your listings’ visibility.

There are so many products on the marketplace, and buyers don’t have the time or patience to sift through every single one. Make it easy for buyers to find your products and you’re on track to win greater sales.

To boost your listings’ visibility, we’ll highlight nine key ways to drive external traffic outside of Amazon and internal traffic within the marketplace to your products. Using these strategies leads buyers right to your listings, so they can make their way down your sales funnel and grow to become a customer.

1. Optimize your listings with SEO

Search engine optimization attracts a wide range of buyers to your listing. Both shoppers who are already on Amazon and those who are using other sites can find your listing when you include popular keywords. With these additions, search engines — both Amazon’s and others — determine that your listing is a relevant result and rank it higher.

There are a few key tools to identify the keywords your shoppers are searching for most frequently.

• Google Keyword Planner: This free tool indicates the monthly search volume of keywords on Google’s search engine. Since Amazon listings can rank on Google, this tool is especially helpful.
• Scope: A keyword tool that’s specifically geared for Amazon. It allows you to track keywords’ monthly volume, ranking position over time, estimated sales, and more.

Once you’ve collected your keywords, place them throughout your listing, such as in the title and description. Detecting these popular keywords, search engines will recognize your listing as a relevant result for your buyers’ searches and rank it higher.

Related: 10 simple small business SEO tactics that you can do in-house

2. Buy sponsored product ads

Even with SEO, there’s no guarantee that your listing will be placed higher in Amazon’s search results. The marketplace’s engine considers other factors for ranking — selling history, price, and more — so SEO alone doesn’t necessarily lead to higher rankings.

To gain more control over their listings’ visibility, Amazon sellers can pay for the marketplace to sponsor their products and place them higher in search results.

Sellers only pay when shoppers click on their ad, so the payoff with Amazon promotion is guaranteed. Your listings’ visibility is increased, so shoppers on Amazon can easily find your product and potentially make a purchase.

3. Share listings on social media

The average person spends nearly two hours per day on social media platforms. Given this popularity, sharing your Amazon listings on social media through your business’ accounts is a powerful way of getting your products in front of more buyers.

Since your followers expect to receive value from your posts, it’s best to avoid creating posts on your account that are basically ads for your listings. Instead, it’s better to share your listing in more subtle ways that are still helpful to your followers. Here are a few ideas:

• Use a social media promo code. Merchants with a Professional Selling account on Amazon can create a promotion link to share through social media about a discount they’re offering on the listing. Unlike a traditional ad, sharing a promo code gives users value by helping them save money. For more details on setting up this promo code, check out this guide.
• Share content that includes your listing link. Posting an informative, helpful blog post or video that includes a link to your Amazon listing, such as a How-to video or list post, is a great way to indirectly promote your products through social media.
• Host a contest or giveaway. Announce through your social media accounts that any user who posts your Amazon listing in their bio will be entered for a chance to win a prize. This reward will motivate users to share your listing and spread the word about your Amazon products.

By creating social media content that is exciting and relevant, you can promote your Amazon listings through social media in a way that feels natural rather than invasive.

Related: How to get more customers with social media

4. Run competitor analysis

For internal visibility on Amazon, your listings need to stay ahead of competitors’ products. In buyers’ searches, your products will fall behind competitors’ items in rankings if you aren’t monitoring how those listings are engaging shoppers.

To keep your listings high in Amazon’s search rankings, there are a few factors you should monitor in competitors’ listings:

• Price: You want to keep your listings’ prices at or lower than competitors’ not only because shoppers are looking for the best deals — you also want to win the Buy Box if you’re sharing a listing with other sellers, and Amazon highly prioritizes price in choosing the box winner.
• Images: When Amazon shoppers are browsing through search results, they’re not only looking at price — they’re also checking out images. Visuals can be a very persuasive factor in encouraging purchases, so you want to make sure that your listing has more images with higher quality than competing items.
• Text: If your listing currently isn’t ranking high for your product keywords, it might be because the listing text isn’t considered relevant by Amazon’s search engine. Analyze the text of the current top-ranking listings to search for potentially relevant keywords that you can include to boost your product.

Finding ways to make your listing outshine competitors’ items on Amazon will increase your product rank in the marketplace’s search results.

5. Partner with influencers

Just like products on an online store, Amazon listings can gain significant traffic through influencer marketing.

When prominent individuals in your industry stand behind your product and link to your listing, it sends a message to communities of your key buyers that your listing is worth checking out.

To promote your listing through influencer marketing, start by coming up with a list of key individuals in your sector with a large base of social media followers. You brainstorm this list by considering your own personal network or use an influencer platform like Influence.co.

Once you have a list going, check out this guide to learn about the best ways to reach out to influencers and measure results once they share your Amazon listings.

6. Maintain strong product ratings

First impressions matter when you’re on a marketplace as competitive as Amazon. Buyers are browsing through thousands of products, so they won’t settle for items that seem low-quality.

A clear way to give shoppers a positive first impression of your Amazon listings is to maintain high-star ratings. When buyers are browsing through their Amazon search results, the star ratings are visible for each product.

Along with price, these star ratings are a major factor in whether shoppers decide to click on your listings. They can’t see your products in person, so this feedback from other buyers is especially meaningful to shoppers trying to make a purchase.

Here are a few tips for maintaining high-star ratings on all of your Amazon listings:

• Describe your item exactly as it is in your listing. False product details and images may boost sales initially, but ultimately they only hurt your Amazon business. Buyers who receive a product that’s totally different from the listing are bound to leave a low rating in disappointment.
• Provide excellent customer service. If you don’t handle customer requests properly, such as shipping the item late or not being prompt in completing a return, you’ll anger buyers. Avoid receiving a low product rating by delivering the item as expected and promptly resolving issues.
• Reach out to disappointed buyers. When a customer leaves a poor rating, reach out to the buyer to see if you can still resolve their issue. If you can fix their problem, they do have the power to edit their review and could adjust their rating to improve the product’s overall score.

Ratings are a key way for buyers to quickly assess your Amazon products. Make sure your items’ scores stay high to keep buyers interested in your listing.

Related: Generate reviews — 8 ways to get more product reviews

7. Maintain strong shipping performance

Shipping, at first, might seem totally unrelated to promoting your products. But on Amazon, your shipping performance is a key factor in your listings’ visibility.

Amazon wants to keep shoppers happy, so they discourage poor shipping practices by making shipping a factor in winning the Buy Box and ranking high on Amazon’s search rankings.

With consistent shipping issues, you’re less likely to win the box or to rank high in search.

Instead of hurting your visibility, use these tips to maintain a strong shipping performance on Amazon:

• Regularly check your shipping performance metrics. In Amazon Seller Central, you can monitor several key shipping performance metrics — on-time delivery rate, valid tracking rate — to ensure that you’re consistently offering great shipping and pleasing customers.
• Use Amazon FBA. By signing up for Fulfillment by Amazon, sellers no longer have to worry about providing great shipping as the marketplace handles fulfilling your orders. If there are any complaints about your shipping from buyers, the marketplace will remove the rating since they are responsible for shipping issues.
• Use inventory management software. Adopting an inventory management program, like Sellbrite, keeps you on track so you can avoid understocking and being unable to complete orders. Sellbrite monitors when your stock is low across channels so you always know when to reorder.

Always provide great shipping and you won’t hurt your chance at winning the Buy Box or at ranking high in search results. With this visibility, Amazon shoppers can easily find your products.

8. Monitor your seller rating

Like shipping performance, your overall seller rating on Amazon also impacts your chances of winning the Buy Box and ranking high in Amazon’s search results.

Punishing low-rated sellers with less visibility is a measure to keep Amazon shoppers happy and sustain the marketplace. It ensures that buyers are first and foremost working with merchants who have a positive record and can provide great service.

To keep your listings visible on Amazon, follow these tips to maintain a high seller rating:

• Monitor your seller rating. On Seller Central, you can view the factors that contribute to your overall seller ratings — such as Perfect Order Percentage and Late Response Rate — and determine which ones need to be improved to increase it.
• Be prompt in customer service. Set a daily reminder to resolve customer issues and respond to customer messages. The quicker you give buyers attention, the more impressed they’ll be with your service.
• Determine whether negative feedback could be removed. Amazon has clear guidelines for providing feedback. Review this post to determine whether any of your negative feedback from buyers should be removed.

Make an effort to keep your seller rating as high as possible and you’ll help your listings stay visible through the Buy Box and Amazon search results.

9. Launch a Lightning Deal

Beyond convenience, many shoppers come to Amazon for the marketplace’s low prices. With this interest, a primary way of attracting Amazon shoppers to your listing is by launching a Lightning Deal.

Lightning Deals are time-based, marked-down products that buyers can find in Amazon’s Today’s Deals section. They draw a lot of attention and sales from Amazon’s shoppers not only because they appreciate discounts, but also because their limited time frame motivates buyers to make a purchase.

Sellers have to pay a fee and Amazon has to approve Lightning Deals before they’re launched.

Here are a few of the key guidelines that sellers need to meet for their Lightning Deals to be approved:

• Lightning Deals run for four to twelve hours.
• Lightning Deals can only run once in a seven-day period.
• You should have your proposed quantity for the deal available at least seven days before the deal is expected to launch.

Amazon selling FAQs

How can I put my product on Amazon? You need to start with a seller account. Choose an individual account or a pro seller account. Once you have that set up you can, you can begin listing products. You’ll need to have a product identifier, a SKU, product and store details, and keywords to show up in the search.

How do beginners sell on Amazon? If you only plan to sell a few products a month, start with an individual account. You will be charged 99 cents per item sold, but does not have a monthly fee.

How much does it cost to sell on Amazon? It depends on the plan you choose and what you are selling. Individual accounts are free, but you are charged 99 centers per item sold. Pro seller accounts have a monthly fee of $39.99, with unlimited sales. Each sale, no matter the account, also has referrals fees, which depend on the type of product. There are additional fees for shipping and Fulfillment by Amazon, if using that service.

Can you sell your own thing on Amazon? There are limits to what you can sell. You can view a list of restricted items here. If you are looking to sell your handmade products, you’ll need a pro seller account to use Amazon Handmade.

Lauren Joyner contributed to this article. 

Image by: Christian Wiediger on Unsplash