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Setting Up an Internet Business - Overheads and
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Setting Up an Internet Business - Overheads and Risk
By Max
Alter
In "Cost Of Setting Up An Internet Business" I showed that
starting an online business has very low barriers to entering
this market because cost is minimal. You do not need any
starting capital because you can get all you need to get
started, namely
- computer
- Internet access
- software
- web-hosting
- customer service point
- product
either for free or extremely inexpensively.
The next hurdle that makes people turn away is the fear of
committing to large overhead costs and incurring an
incalculable risk. Let's have a look at these two fear
factors:
Overheads
Conventional businesses cannot get started before they have
their infrastructure in place that includes premises, staff and
stock.
In contrast to conventional businesses, here is a list of
what you DON'T need when you're setting up an Internet
business:
- stock - to be more precise, you don't need warehousing,
large product inventory and administration because you can
use drop shippers or fulfilment houses.
All this is true for any kind of physical product. When it
comes to digital products (ebooks, videos, sound files,
programs), the picture becomes even more attractive:
- There simply are NO costs for production, packaging,
shipping or any kind of handling as everything is
electronic AND delivery is simply downloading 24/7.
- If you start as an affiliate, you don't even have to
spend time and effort on developing a product, marketing
material and managing payments.
Either way, whether you prefer physical or digital
products for your Internet business, overheads are not a
necessity. They simply evaporate.
Risk
Setting up a new business is risky, or so they say.
Statistics talk about 60% or 80% of new businesses closing down
again within 3 to 5 years from start with significant financial
loss to the business owner. That's a pretty high failure rate
and makes setting up a new business very risky, especially in
times of economic crisis.
In a conventional brick and mortar start-up you incur
overheads even before you have cash flow, not to mention
positive net profit. You have to have stock, staff, premises,
insurance, licences, health and safety inspections and whatever
else your particular kind of business requires. The risk, apart
from your time, is significant financial loss.
What is the risk when setting up an Internet
business?
First of all, as most budding Internet
entrepreneurs already either have access to the Internet or own
a computer with Internet connection overheads are pretty much
negligible. Everything else - domain registration, website
hosting, autoresponder - will add about $30 per month.
The next risk factor - stock - also
disappears. As an affiliate marketer you don't hold any stock.
If you start with drop shipping, your supplier holds the stock
and ships it. If you develop your own information product, your
fulfilment house will be able to produce and ship on demand.
Even if you decide to hold some stock so that you can ship it
yourself, the cost will be an initial outlay of a few hundred
pounds or dollars. How significant a risk is this, especially
when compared to setting up a brick-and-mortar business?
Thirdly, what is the risk of not being able
to start your business because you are unable to secure a bank
loan or find an investor? As you don't need any capital, this
risk simply does not exist.
Fourthly, you don't have to jump in head
over heels. You can start slowly, part-time, and build up your
Internet business as and when you have the time to do so.
Again, this is another benefit that allows you to eliminate any
financial risk to yourself and your family.
Finally, the most important factor in
setting up your Internet business is your willingness to learn
how to succeed in this environment. A great deal of information
is freely available. Whatever has to be paid for nowadays
always comes with a minimum of 30-day money-back guarantee.
This means that you can get started and give the system a good
run for your money. If you find that it does not live up to
expectations, you'll get your money back. The risk of buying
the wrong program is therefore reduced to zero, as simple as
that.
In summary, as there aren't any overheads and as there is no
risk either, what better business is there to start up than an
Internet business, especially in difficult economic times?
And now I would like to invite you to claim your Free
Instant Access to the 5-part report with many more details and
full of tips where to find all you need to set up your Internet
business for free or at extremely low cost when you visit
http://www.IncomeOnDemandSystem.com/freereport
Max Alter - Intelligent Choices Unlimited
http://www.IntelligentChoicesLtd.com
Article Source: http://EzineArticles.com/?expert=Max_Alter
http://EzineArticles.com/?Setting-Up-an-Internet-Business---Overheads-and-Risk&id=2492420
Max Alter
June 20, 2009
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