An Aspiring Entrepreneur’s Guide to Starting an Online Business
Here, business checklist items of all things you need to cover
E-commerce is now today’s biggest driver for business worldwide. In fact, since the COVID-19 pandemic hit, the share of e-commerce in global retail sales rose from 16% in 2019 to 19% in 2020.
Looking at the local landscape, too, the Philippines has since emerged as one of the countries that largely benefitted from the height of e-commerce in this span of time. According to the Department of Trade and Industry (DTI), online retail contributed 3.4% or ₱599 billion to the Philippines’ GDP in 2020, with 93,318 registered online sellers from March 2020 to January 2021 alone.
Even as the country adjusts to the “next normal,” we see that online transactions will continue to be part of society’s norm—something aspiring entrepreneurs ought to note. If you happen to be one and looking to kick off your brand online, read the post ahead for a guide on how to start an online business today. (A bonus? Do it with the help of Globe.)
The 6-Step Guide to Starting an Online Business
Beyond just setting up a website or social media page, aspiring entrepreneurs must undergo a thorough process to start an online business—and start it strong. They likewise must invest the time and effort to ensure their venture takes flight. Check out this six-step guide to get started:
Step #1: Know your target market.
Before venturing into the world of business, you must first identify your audience in order to get a clear direction for your brand. As the famous saying goes, “if you’re selling to everyone, you’re selling to no one.” Start by asking yourself the following questions:
Who am I trying to sell to?
What are their behaviors and interests?
What are their needs and pressing problems?
How can my product or service resolve their problems?
How and where do they want to be approached?
While you can easily answer some of the questions on your own, you can learn more about your intended audience by joining online communities, conducting surveys, or observing your potential competitors.
Step #2: Identify your product or service.
Once you have a target market in mind, it’s time to identify a profitable product or service to sell. In this stage, consider offerings that you can create with your existing skills and knowledge. Should you realize that you don’t have a definite offering just yet, there are a lot of online business ideas you can check out. Ahead, find some of them.
A clothing line: The fashion industry is now the top e-commerce sector in the world. Even if you don’t have the skills to create clothing yourself, one way to pursue this business idea is to resell high-quality thrifted clothes or print designs on shirts instead.
Dropshipping: Dropshipping is a viable business idea if you don’t have enough capital to store inventory or invest in fulfillment. You can buy merchandise from a wholesaler or manufacturer and have them ship orders to your customers.
Subscription boxes: From fitness snacks to beauty samples, there’s now a subscription box for almost every product. A subscription box business model is ideal for budding entrepreneurs as it requires less capital, reduces overhead costs, and adds instant value to niche markets.
Niche products: If you happen to be part of a particular community, you may find it easier to sell niche products online. For example, if you’re a K-Pop fan with graphic design skills, you can sell customized T-shirts, phone cases, or bucket hats to members of the fandom.
Step #3: Create a business plan.
A business plan gives entrepreneurs clear and specific steps for them to achieve their goals. This document is sometimes required when entrepreneurs apply for a business loan, so it’s good to develop this and have it at the ready. Business plans consist of different components, such as:
Marketing: The marketing portion of your plan should address what product or service you want to sell along with how and where you plan to sell it—essentially, your marketing plan.
Production: Here, specify every aspect of your production processes, including equipment, materials, and labor.
Management: As an entrepreneur, you must also show your capability as a leader. Detailing your management style and qualifications is essential in assuring banks that you can run your business well with the money they’ll lend you should you be interested in applying for a business loan.
Finance: This part of your plan should show how your business will financially perform. Be sure to collate details such as your cash flow statement, break-even analysis, and sales and profits forecasts.
Step #4: Register your online business.
When starting an online business in the Philippines, entrepreneurs must undergo legal processes under different government agencies. Below are the steps in registering your online business:
For DTI: If you already have a business name in mind, your first order of business is to confirm its availability via the DTI website. Next, fill up the agency’s online registration form, then pay the necessary fee. Once your payment is confirmed, and your business name is registered, you can download your certificate on their website.
For the Bureau of Internal Revenue (BIR): Depending on your business ownership type, you can register with the BIR through its New Business Registration (NewBizReg) Portal. Make sure to submit the required documents, pay the necessary fees, and wait for your Certificate of Registration to gain your business tax identification number (TIN).
For local government: You must also acquire a barangay business clearance and a mayor’s permit. For both applications, present two valid IDs, proof of address, and the certificate of registration from DTI. Apply for a barangay clearance first, as this is required when securing a mayor’s permit.
Step #5: Set up your digital platforms.
Your online presence is the core of your online business, so take the time to set up the following:
E-commerce website: Your website is the face of your online business. This is where you can share your origin story, goals, and, of course, your products or services. Be sure to have it set up. Make sure it includes all pertinent information and is easy to navigate.
Social media accounts: Social media allows you to market your brand and communicate with your customers. You can also use these channels to seek feedback, experiment with marketing strategies, and conduct competitor analyses.
- Online marketplaces: Joining online marketplaces is another excellent way to reach your target customers easily. Here, you can give discounts and other perks to create a loyal following.
Step #6: Launch and promote your brand.
Once you have the fundamentals in place, it’s time to launch and promote your online brand. Use your social media channels to market your products and services, and employ other strategies to expand your customer base quickly.
Start Your E-commerce Journey Today with Globe
If starting an online business sounds overwhelming, you can count on Globe Business to join you as a partner through this journey. Globe Business helps small- and medium-sized enterprises (SMEs) discover the right products and services for their needs and navigate different industries in the Philippines. Check out their digital services to learn how you can get started with Globe Business today.