How to Start an Online Business in 2024

If you’re looking to start a business online, there’s really no better time to do so. According to Beauhurst’s New Startup Index, a record 900,000 new businesses were incorporated in 2023 - an impressive 12% increase from 2022. So, if you’re looking to step into those entrepreneurial shoes this year and break free from the standard 9-5, there’s no reason to wait.

Whether you’re looking to create a side hustle, or pursue your passion full time, understanding how to start an online business is crucial. Starting a business is no walk in the park, with numerous hoops to jump through - but the rewards can be life-changing.

In this comprehensive guide, we’ll cover exactly how to start a small online business, from market research to choosing the right business model, so all the boxes are ticked. By following these simple steps, you can take your business idea and transform it into a thriving enterprise. Let’s get started, shall we?

Why an online business?

There’s no denying that we’re now living in the digital age. So much of our lives are now online, including online banking, online shopping and social media. Choosing to start a business online can unlock customer engagement on a global scale, often at a fraction of the cost.

Here are some of the key benefits of choosing to start an online business: 

• Lower startup costs: Online businesses often require less initial investment. You can avoid the cost of renting or buying a physical space, as well as the cost of utilities and hiring in-store employees. Your operational costs are likely to be significantly lower as you won’t need to cover property maintenance either.

• Increased flexibility: Unlike running a store or other physical enterprise, you can manage your online business from anywhere in the world. This can offer you flexibility when it comes to both location and your working hours.

• Customer insights: With an online business, you can make the most of various analytics tools to track your customers’ behaviour and preferences. You can use this data to inform your business decisions and personalise your marketing efforts. 

• Marketing opportunities: You can make the most of various digital marketing strategies to get your business name out there. From SEO to email campaigns, you can market your brand digitally, often at a lower cost than traditional, print-based advertising. 

• Customer convenience: Not only does an online business offer you flexibility, it suits the flexibility and convenience of your customers too. Your buyers can shop from their homes or on the go, which can improve their overall customer experience. 

What kind of online business should you start?

If you’re planning to start a business online, one of the first steps in your journey is deciding on your business model. There are several types of online business models to choose from, and one of them is likely to suit your work preferences and lifestyle the best. 

Before jumping headfirst into starting your company, it’s always a good idea to plan. Make sure you prioritise writing your business plan. Your business plan details your business’ goals and strategy and can keep you on track. If you’re thinking of applying for a business loan, the bank is likely to ask to see your business plan too, so they know you have a strategy in place to pay back the funds you owe.

As technology has evolved, so too have the types of online businesses available which we’ll dive into below. 

Consulting 

Online consulting is a business model whereby you offer professional advice to clients through your digital platforms. These platforms may include social media, content marketing (such as blog posts or podcasts) or even one-to-one coaching via video calls. If you have specialist knowledge in a particular area, there’s no reason why you can’t share your expertise with others. Consulting is super flexible too - there are consultants in just about every area or niche imaginable from marketing and finance, to marriage and relationships. 

If you have the drive to help others and a particular passion or background in a certain area, coaching or consultancy may be for you. It should be a fairly straightforward online business to start too. All you need is your existing knowledge and skills, a stable internet connection and a platform to get your name out there. 

Freelancing 

Freelancing is a popular online business model, allowing you to offer your service to clients on a project or contract basis. According to 2024 data, 13.6% of the UK aged 16 and over are doing some form of freelance work. Starting a freelance business is a flexible and popular way to take your skills and passions and transform them into a successful enterprise. 

First, you’ll need to decide on your freelance niche - the area where your skills and strengths lie. What is it you’re passionate about or excel at? From there you can identify any gaps in the market that you could look to fill with your service, and tailor your offering to the needs of your potential clients. Make sure you shout about your services online, by optimising your website for SEO, and connecting with potential clients at events or through online platforms such as LinkedIn. By making the most of your platforms and digital tools, you can build an independent, thriving business in no time.

Dropshipping 

Dropshipping is a flexible business model with very low startup costs. Rather than buying, storing and shipping products yourself, you get a third party to take care of it for you. You’ll create an online storefront for customers to browse products. When a customer makes a purchase, you forward the order and payment to a supplier who then ships the product to the customer. This eliminates the need to invest in a warehouse or keep stock on hand. This means you can devote more time to marketing your business and connecting with your customers.

Homemade goods

Homemade goods, often described as DIY businesses, are a creative business route for those looking to sell their creations. Homemade goods businesses take little money to get started and can be started as a side hustle, or your primary source of income. 

There are numerous benefits to starting a DIY business, from becoming your own boss to the freedom to work anywhere. When it comes to getting started, your to-do list should be relatively small. All you need are your startup supplies, a stable internet connection to set up your website and promote your products and some cash to hand to cover initial shipping costs. From jewellery making to woodwork, you can let your creativity run wild as you build your enterprise.

Creating content

In recent years, content creation has become a popular and competitive field. In fact, there are over 200 million content creators in the world, making it a thriving industry to be a part of. But there is more to content creation than meets the eye - it requires a solid strategy and a commitment to regular posting to get your content seen. There are numerous forms of content you may choose to create for profit, from YouTube videos to social media posts. 

It’s important to note that like many things in life, content creation requires patience and time. Try as you might, it’s unlikely that you’ll become a household name overnight. But by regularly posting and engaging with your audience, there’s no reason why you don’t have a chance of success waiting for you.

Conduct research

When you start an online business, it can be all too easy to get ahead of yourself with the excitement of it all and forget to plan ahead. A key element of planning your business is research - in fact, research is vital at every stage of your business journey.

Research lays the foundations for your decision making, and can help you to mitigate risks and make the most of any opportunities that come your way. By identifying the needs of your customers and market demands, you can cater your product or service to appeal to your customers’ needs and stand out against your competitors. 

Research the market you plan to enter and who your competitors are. Identify their strengths and weaknesses so you can differentiate your service or product accordingly. From there, you can get to know your potential customers, determine their needs and preferences and market your product or service to appeal to them. 

Find the perfect product or service

Deciding on the product or service for your business is a major decision that requires consideration of several factors, such as market demand, your background and your career goals.

Here are some tips to consider when deciding on the right product or service for your business:

• Identify your expertise or passion: Bring it back to basics. Consider your interests, skills and values and try to choose a product or service that reflects them. After all, you’ll want to enjoy the work you do and truly care about the product or service you’re selling.

• Market research: Carry out market research to help you spot opportunities and demand for certain products or services. Is there a demand for a product that isn’t available, that you could introduce? Consider trends, competition and profitability. 

• Your resources: Assess the resources you have available, including your finances, skills and time. Make sure you choose a product or service that fits with your resources, so you can put your plans into action. Do you have the budget to make your business idea happen? Can you rely on your network for support? 

• USPs: Decide on your unique selling proposition (USP) which is what makes your product or service unique and better than your competitors. This will play a pivotal role in your branding and marketing too. 

• Your business model: As mentioned above, once you’ve decided on your product or service, you’ll need to choose the most appropriate business model. From dropshipping to consulting, make sure your business model aligns with your goals and resources. 

Stake your claim by registering your company 

Once you’ve fleshed out your online business idea, you’ll need to officially form your company. While the idea of registering your company may sound complicated, once you get your head around the process, it should feel straightforward. 

You’ll need to form your new business with Companies House, which maintains the register of companies in the UK. You can do this yourself for a £50 incorporation fee, or trust a company formation agent to take care of the registration process for you. 

With SUAZ, your company formation is completely free. We’ll cover the £50 incorporation fee (no catch!) and you’ll have our advice and support to hand whenever you need it. We’d love nothing more than to help you on your road to success. Take a look at our company formation packages to get started. 

Consider the legalities

There are more legal considerations to be aware of than company formation. Make sure you cover all legal bases when forming your business, and consider any insurance or certifications you’ll need to have.

Taking out business insurance can give you the peace of mind that if disaster were to strike, you’ll have a helping hand there to pick up the pieces. If you’re planning to hire employees, you’ll need to take out employers’ liability insurance to protect your business should a member of staff become injured or fall unwell as a result of working for you. While not a legal requirement, you may also choose to take out public liability insurance for financial protection, should a third party claim to have suffered injury or property damage because of your company. 

Build your website

You can think of your website as your digital headquarters, where all your interactions, transactions and operations take place. As an online business, investing time and money into your website is vital. Your business’ website is a valuable marketing tool to showcase not only your products or services, but your company’s mission and message.

If you’re looking for a web hosting provider to get your website up and running, why not browse the BSC marketplace? Our partner site, BSC, can connect you with a variety of professional web hosting providers to get you online, at a price that fits your budget.

Increase your odds of success

The online business market is a highly competitive space to navigate. With an uncountable amount of online stores, content creators and service providers looking to stand out, you’ll need a solid strategy to give you the best chance of success.

Here are some tips and tricks to help your business stand out from the crowd, in such a competitive market.

• Identify your USP to clearly define what sets your business apart from your competitors. Maybe you pride yourself on your excellent customer service, or a unique product that will take the market by storm.

• Make sure your website is optimised for SEO and user experience (UX). This means ensuring your site is mobile-friendly and has a user-first interface that’s easy to navigate.

• Prioritise high-quality content that addresses your audience’s needs. From blog posts to podcasts, make sure your content is engaging, promotes your brand and is optimised for SEO.

• Try to attend industry events, such as conferences or webinars, to build connections and keep up-to-date with industry trends. 

How SUAZ can help

There’s no downplaying it - starting your own business can feel complicated. But it doesn’t need to be. With our company formation service, you’ll have the support you need to approach each stage of your journey with confidence. Form your company with SUAZ today.