You might think that coming up with ideas for an online business would be pretty simple. And in many respects it is. But unfortunately, it’s not enough to just come up with the ideas. You have to come up with business ideas that are:

• Workable - an idea is no good if you can’t actually put it into practise.
• Affordable - no matter how brilliant your business idea is, if you can’t afford it, then you can’t do it.
• Wantable -(is that a word?). Don’t fool yourself into thinking that just because you think something is a good idea the rest of the world will also think so. And if you’re the only one who thinks it, there’s not much chance of it being…
• Profitable - a business idea that doesn’t produce profits isn’t really a business idea at all. It’s just an idea!

Starting an online business is much cheaper than starting a business in the real world of bricks and mortar. Real estate on the Internet starts at just a couple of dollars. Try finding business premises in your local high street for that price!

However, just because it’s cheaper doesn’t mean it’s necessarily any easier. Ask any of the hopeful Internet Entrepreneurs who’ve tried and failed, usually spending waaaayyyy more than they would have done had they invested in a brick and mortar business anyway.

If you are currently thinking of starting up a business on the Internet, then do yourself a favour and take the time to do a little business planning before you start.

Business Budget

How much can you afford to invest in your online business? At the very least, you’ll need to be able to afford a domain name and hosting. Just because an online business can be set up cheaply doesn’t mean you shouldn’t have a business budget.

Your budget needs to be realistic. Are you going to work your online business full time? If so, then how will you pay your bills until the profits start coming in?

Business Savvy

Sad to say but there’s a lot more chance of being ripped off when you set up a business on the Internet than there is if you set up a business offline. Be very careful you don’t get caught up in one of the myriad of business scams out there.

If you see anything that promises you a way of making money within days, with no work on your part other than pushing a few buttons… run for the hills. Or at the very least, for the next sales page.

Know Your Strengths

If you’re the sort of person who doesn’t like to be tied down, then starting an online business which will require you to be tied to your computer for a set amount of time might not be the way to go. Decide upfront if you’ll be happy running a business that is based on providing a service (you get paid when you do the work), or if you’d prefer a business that provides residual income, (you do something once that provides you with a residual income).

Online Services

Obviously there’s a limit to the type of business services you can offer if you’re running an online business. Just as with an offline business, some services are geographically limiting. The Internet doesn’t remove those limitations.

However, any service you can do via email / fax / phone / download is wide open for you to start. For example, one of the services I offer is that of e-book formatting.  A very simple service that I can offer to anyone, anywhere in the world, as long as they have an Internet connection.

You don’t need to limit yourselves to services that can be delivered via the Internet however. There’s still snail mail if you want to provide custom print services/direct mail, etc.

Just because you’re running an online business doesn’t mean your business idea has to be totally digital.

Residual Income

For many, the dream online business is one that allows them to do no work and still bring in profits. Of course, it really is just that. A ‘dream‘ online business.

There is no business that can earn you money without doing some work. You may not have to work every day, but you will at least have to put in some initial effort.

You could try setting up a niche focused website that sells products. The products can be be either your own or someone else’s. It doesn’t matter. If you sell your own product however, and you want your income to be totally hands free, then you will need to either make it available as a digital download or automate the physical creation and shipping of it.

For example, if you put together a manual on how to make your own jewellery, you can sell that manual over and over again. Once it’s written, you don’t have to do anything else other than sell it.

You can either sell it as a digital download from your website, or you can have it printed and published as a physical book by using a service such as Lulu.com In fact, why not do both?

Of course, you don’t need to create your own products. You can always set up a website that sells other people’s products. In many ways, this is often easier as you don’t have to worry about customer service, returns, etc. The downside is that you are at the mercy of the product creators. If they decide to stop production, you are left with a website that is of no use.

Which brings me to a point you should always consider when setting up an online business.

Business Foundations

Many an online business has gone bust because they were built with too much reliance on a third party website/service. As much as possible you want to reduce your reliance on outside parties and keep as much control as you can within your own hands.

This is why I have always recommended using your own hosting rather than hosting your website on a free service. If the free service goes bust, it takes your site with it. If that site is making you money, you’ve just lost your income.

Other parties are not bothered about your business. They are concerned (rightly so) with their own business. Remember that.