Setting Up An Online Business


Experts believe that by 2020, transactions carried out online, or at least influenced by the internet, will account for 90% of total sales.

Generating additional revenue through websites is something many businesses have been doing for some time now. However, recent years have seen considerable growth in businesses operating exclusively online and this is forecast to continue. This is not surprising considering running a company online can be cheaper and less risky.

First Steps

The first steps for any business is market research. The same goes for those creating an online company. It is important to identify your target audience well before you start trading. This should include an assessment of competition, demand and how potential customers react to your proposed pricing.

It is also essential to write a detailed business plan. Those organisations which expect to exceed £82,000 in annual sales (2015-16), are obliged by law to be VAT registered. Tax is payable in accordance to the organisational structure, whether operating as a limited company, sole trader or a partnership. As with any business, online traders also need to comply with data protection legislation, including how they store and share information about their customers and other stakeholders.

The success of an online business is very much dependent upon effective marketing and gaining good rankings on search engines, such as Google. This can be achieved through careful Search Engine Optimisation (SEO) techniques and paying for services, such as pay-per-click Google Adwords.


Will you design and host your own website, or employ the services of someone else to do it for you? While it is obviously cheaper to do it yourself when it comes down to a website, the results are unlikely to be as effective or profitable as paying a professional to create one for you. Discuss your budget and needs with a designer, providing a clear brief, and they may be able to come up with a solution to suit you.

Depending on the size and nature of your business, you may decide to operate through a third party. Organisations such as, offer a range of service, including eBay store design.

Essential Information

By law your business must display certain information on its website. This includes an address and details of how to contact you, terms and conditions, privacy policies, refund and exchange policies, payment and delivery information and quality assurances. It is vital to keep information about prices and availability of stock current, as well as the P&P and VAT payable for each item.

You can include a shopping cart facility to collect payment, including a secure function to ensure customers’ card details are safe.

Protecting and Testing your Website

It is really important to thoroughly test your website before you launch your online shop. This will provide the opportunity to rectify any issues before they arise – and most importantly, before you go live.

Gathering and acting on feedback where valid is vital to the ongoing success of your company. Customer engagement will increase loyalty, is great for brand awareness and is also important for word of mouth recommendations.