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What does it cost to start an online business? Learn how to create a successful budget to get started.
The cost to start an online business is surprising low! You think you might be able to make money blogging, or teaching online, or selling products that dropship. You can! You just need to be aware of potential costs and plan accordingly.
Entrepreneurs such as you are increasingly turning to business concepts that can be realized on a virtual platform, whether moving traditional service or sales businesses online or creating the types of businesses that can only be found online such as blogging and affiliate marketing.
Virtual vs Storefront Business Expenses
Creating or moving your business online when feasible is a no-brainer. Renting an office or retail store is obviously far more expensive than creating a website because maintaining a physical space has other costs besides rent or mortgage such as utilities, salaries of staff, liability insurance, workers’ compensation insurance, cleaning company, accounting services, and loss from theft, among others. The cost to start an online business can clearly be much less.
A virtual business can be run from anywhere with reliable high-speed internet and a late model MacBook or PC. These two things will be your first expenditures, and don’t skimp – you will thank yourself when things are up and running and going smoothly, with no interruptions in service and with everything technical you want to accomplish at your fingertips.
Keep in mind that a business with a storefront or office must have computers and the internet too!
So you see that even traditional product sales and services, such as marketing, accounting, or legal services, can save in business costs by moving operations online. This, in addition to the personal safety concerns arising due to the COVID-19 pandemic, is why doing business virtually is hot right now.
CNBC recently even reported that 70% of people work from home virtually at least once per week!
The Best Computer for Your Online Business
Do not stress over your choice of computer. The best computer for your online business will be the one you are comfortable using, that you can afford, and that can help you effectively and efficiently create the virtual content you need for your website and blog. It very well may be the one you have already! Undoubtedly, as your business grows you will discover what functions your computer is missing, if any, and eventually upgrade.
Using the computer you already have is the most cost-effective way to get your business started. But if you feel you need something newer or more powerful and you have the funds, you can purchase a new computer. Let’s narrow it down from there.
Should I get a laptop or desktop computer for my virtual business?
Desktop computers are and will likely always be more powerful and easier to upgrade than even the best laptop. Desktops are also less expensive than laptops. If your concern is affordability, speed, reliability, ease of upgrade, and longevity, a desktop is for you.
As of this writing (July 2020), some recommended desktops, priced lowest to highest, include:
- Dell OptiPlex 3050 Micro ($500-700)
- HP Elite Slice for Meeting Rooms ($1200-1800)
- Apple iMac 27-inch ($1800)
- Apple iMac Pro ($4000-$5000)
- Microsoft Surface Studio ($3000-$6000)
Laptops allow you to work from just about anywhere. If your primary concern is being mobile, some recommended laptops, priced lowest to highest, include:
- Google Pixelbook Go ($650)
- Microsoft Surface Book 2 13.5-inch ($900-1500)
- Huawei MateBook X Pro ($1000-1600)
- Lenovo ThinkPad X1 Carbon (6th Gen) ($1100-1300)
- Dell XPS 15 (2020) ($1300)
- MacBook Pro 16-inch ($2100-2400)
What computer accessories do I need for my virtual business?
You will need a printer. While the nature of a virtual business will render most documents and information electronically, you will invariably need to print something out occasionally. Consider purchasing an all-in-one printer that has copying, scanning, and faxing functions as well as printing.
You probably already have a smartphone. This is a handy device for quickly answering emails and for making videos, along with video-editing software on your computer.
If you intend to “vlog” you will likely need a tripod for your smartphone and a lavalier microphone (“lav mic”), which is a small clip-on mic that may be either wired or wireless. Lav mics are especially convenient for videoing interviews.
Procuring Reliable High-Speed Internet for Your Online Business
Using Traditional Cable or DSL Internet
Cable internet is likely the most reliable, but also tends to be the most expensive. Be sure to shop all of your local providers for the best deal. Often cable and DSL companies will bundle landline, internet, and cable TV services.
A bonus: if you subscribe to cable or DSL internet at home, you probably have free access to all of your provider’s Wi-Fi hotspots when you travel, with your password. Your provider will have a list of the locations of their Wi-Fi hotspots.
Using Wi-Fi Hotspots
The customers of major cable and internet providers Xfinity, Spectrum, Cox, and Optimum can access all of these providers’ Wi-Fi hotspots for free. This gives customers access to over 500,000 hotspots in a network called CableWi-Fi. You can find the location of hotspots in this network at CableWi-Fi.com.
If you are not a home cable subscriber, you can access hotspots at many coffee shops, libraries, universities, and bookstores. Municipalities often have free outdoor public hotspots. While these hotspots are free to you, be forewarned that they may not be as secure as hotspots accessed via password.
If you are in a pinch you can create a personal hotspot with your smartphone. You can also use your smartphone as a modem, by tethering it to your laptop. Either of these will quickly drain your phone battery, however.
Using a Mobile Broadband Service
If you have a laptop, you can have a card installed or purchase a “laptop stick” that allows you to access a mobile broadband service. These services are subscription-only, and can only be used on one device at a time.
Using Satellite Internet
In more remote areas where cable and DSL are not offered, and there are no hotspots, those requiring internet access can turn to satellite internet. Satellite internet providers beam the internet to your home from satellites in orbit around the earth. Unfortunately, this service is pricey and can be interrupted by bad weather.
How Much You Should Spend on Your Business Website
What do you want your website to accomplish for you? Is it a platform for affiliate marketing? Is it a business card for your Skype or Zoom teaching, with a blog? Is it meant to host products for sale, with a shopping cart?
The first thing a website should do is clearly set forth the nature of your business for the viewer. The next thing it should do is be findable when people search for the thing you offer. Then, it should be credible, persuasive, and easy to use so that the viewer is converted to a client or customer.
If you have no experience in website design or Search Engine Optimization (SEO), you should consider consulting with a professional firm. Costs of employing such a firm to design your website and maximize content for SEO vary from $750 to create a simple website with a small monthly SEO fee, to thousands.
Fortunately, it costs nothing to consult with a web design and SEO firm so shop around for a firm you’d be comfortable working with, that provides services you need and can afford.
What if I have no money for website design or SEO?
In the alternative to hiring professional web design, marketing, and SEO firm, you can create your own website using one of the many available free website designs and hosting services. It is a simple matter to get up and running using the templates offered by Wix, Squarespace, GoDaddy, Freewebstore, or any of the many available services.
To maximize the content of your website for SEO, you should consult the free articles on this site, and you might also search Youtube for free videos on SEO. You will find many credible and informative tutorials by Ahrefs, Moz, and Hubspot, among others. If you have more time than money, you can learn a bit about SEO and get your site to rank for the terms searchers use when they are looking for your type of service or product.
The Costs of Marketing Your Virtual Business
Social Media Marketing
Employing Facebook, Instagram, and Twitter to promote your business to your network is a must these days. You can do this free of charge, the only cost being your sweat equity. In the alternative, you can employ a social media manager to do it for you. Many SEO/web design firms have a social media manager on staff to help their clients.
No idea where to get started with social media marketing? Sign up for my free social media marketing crash course here!
Google or Facebook Ads
Investing in Google and Facebook ads requires a bit of SEO knowledge to figure out your target audience. There are plenty of free tutorials online, if you have more time than money, or your webs design and SEO firm can help you.
Your Online Business Budget Summary
Besides a good idea, here are the things you’ll need to start and run your virtual business:
- Computer
- Computer Accessories
- High-Speed Internet
- Domain and Website
- Marketing
You can see that the cost to start an online business is very appealing for so many reasons.
In short, if you own a computer and already have high-speed internet you can simply jump in and get started by purchasing a domain name and then creating a free website. If you have some ready funds, the next thing you might invest in is the help of web design, marketing, and SEO firm to give you a better chance of being found online and of converting those viewers to customers.
Best of luck with your online business!
Check out some other posts on starting your own online business here:
18 Legitimate Ways to Make Money and Work From Home in 2020
Create a Powerful Action Plan for Your Online Business
Savvy Ways to Use Facebook Groups for Marketing Your Blog Business
About the Author
Veronica Baxter is a legal assistant and blogger living and working in the great city of Philadelphia. She frequently works with Philadelphia bankruptcy attorney David M. Offen.
Great read and very interesting. I live in a remote town but luckily there us one company that provides DSL here. That was my only choice and it is more expensive than what I was paying for broadband in Houston. However, I just happy to have internet!
Hi Julie! I couldn’t imagine not having internet available all the time.. Glad to hear that you at least have one option! Thanks for reading 🙂
Wow, this blog post was so useful! Thank you so much for sharing.
Hi Pernille! So glad that you enjoyed the post! Thanks for reading 🙂
Thank you this is a very informative page. It has helped me learn some new things about virtual business.
You’re welcome, Joanne! Thank you for reading… Glad that you could find some gems on starting your own online business. Cheers!
great list of suggestions. i have toyed with the idea of a podcast and a lav mic sounds like a must.
Thank you! I need to check out that mic myself! It looks perfect! Have an amazing day 🙂
I have been debating for a while whether I should launch my online products. I currently work full time and I’m not sure I’ll be fully able to devote time to a business right now but these tips were definitely helpful! Thank you so much!
Hi Monique! There’s definitely some things to think about when considering starting an online business. And, speaking as a full-time 9-5 worker and online business owner, it can certainly be a bit of a juggle. You’ll know when the time is right for you :). Thanks for reading!
Hi Sasha, I invited in a MIFI, a mobile hotspot. I can’t imagine not having it for times when the internet services are not the best when I travel. Even going to visit relatives, etc the MIFI has been an invaluable tool today.
I worry about the internet speeds as everyone today is working from home and school. It really can slow the speed down and make it impossible to get a lot done.
Hi Lisa 🙂 A mobile hotspot is a great idea! I’m always tethering off my phone when I can’t get a connection. How do you find the MIFI? Is it pretty reliable?
Yes Sasha, most of the time it is reliable but since all the activity of everyone being online with COVID-19, working from home and school, it’s gotten slower, sadly. But still I can’t imagine NOT having one. It’s great too if you lose internet access due to storms.
Thank you for sharing. This post has so many useful tips.
You’re welcome! So glad that you enjoyed it! Cheers 🙂
Excellent thoughts as always! I have always wanted to have a brick and mortar store, but the costs have always been the barrier to that dream. I currently sell on Etsy, and it’s been a great platform for fulfilling that need inside myself!
Thank you Crystal! I think that cost really does prohibit a lot of potential businesses in a brick and mortar. Online business is definitely a great segue in to that world!
Great content and insights! How much would you say is necessary to spend on Ads on social media to boost your content or business?
Thank you, Emeline! I don’t think that it’s necessary to run ads, especially in the beginning but you can definitely test out $5/day campaigns on Facebook to see if you can generate more leads when your business is ready.
Having just launched a blog two weeks ago, this is some great advice. I definitely took some great information from this post, so thank you! Next step: upgrading my laptop! 🙂
So exciting! Welcome to the crazy world of blogging! So glad that you are finding some blogging gems to help you get off to a great start 🙂
Great information! New to blogging and am soaking in all that you share!
So exciting! Welcome to the crazy world of blogging! Cheers!
This was very informative! I just started my blog this past Sunday (has been unofficially blogging through my fb page and connecting in Instagram) and at this time I’m not starting a business but I can see your post as a very helpful resource to come back to in the future!
OOOOh! So exciting! Congrats on your new blog and thanks for reading. 🙂
Thanks for the laptop recommendation. I’m actually looking for a new one right now !
You’re welcome! So glad that the post came to you at the right time! Hope you find a great laptop to work with 🙂
Your site is beautiful and I’m loving your posts.
Thank you so much! Glad you are enjoying my content. 🙂
Wow! This was exactly what I needed as I just began my new blogging website. It is truly comprehensive, written in a language that I could actually comprehend, without much of the technical jargon. I hope I can put to use at least some of the information to get get working on my website. Thank you for sharing this. Truly truly helpful
Thank you for the kind words, Anitha! So glad that you found some value in this post! Thank you for reading! 🙂
This is such a great informative article. I think a lot of people underestimate what goes into building an online business and this covers so much! Thaks so much for all the valuable info!
Thanks Jenn! I remember when I first started that I wasn’t looking at all the little expenses and those really started to add up! Once I had a clearer picture, I could see exactly how my blog was actually doing as a business. Totally worth it to keep track!
What a great,informative post. I have only really started getting my business up and running in the last 6 months and having someone sum up the costs is awesome. Thank you!
Thank you Carletta! So glad that you found the post helpful for you. Best of luck to your new business as well 🙂
Great post, thank you for sharing! I just started an online business myself and this was very helpful!
Excellent! So glad that you found the post helpful and congrats on the new business adventure!
I never really did this and kind of wish I did. I know it’s not too late I can go back and create a budget and then also write down what I spent and then come up with a plan going forward but I still find it confusing when it comes to basically just trying to monetize a “personal/lifestyle” type website.
Creating a budget is definitely a good idea because it’s easy to forget all the little things when it comes time to seeing if you are making money or not. Monetizing a broad niche is harder than a specific niche for sure. Have you thought about honing in on your audience a little to help with that?
Great tips. As someone who wants to eventaully work part time overseas, figuring out the internet situation is going to be my main concern.
That would definitely be something to factor in, Clara. Depending on where you are at, there may be issues. Great to think of to check out ahead of time. Thanks for reading!