One of the questions I get asked a lot when face to face with clients in Pattaya or in general in meetings around Thailand is “what is the best business to make money online?”. It’s the question that plays on our minds all the time. What online business can I start that will set me up for life?. There is one answer to this burning question and it is always the same.
“There is no one type of online business that will make more money than another. How much money you earn on any online website will be determined by a number of factors”.
The answer may appear vague, but it is as accurate and truthful as they come. There are simply too many factors that will influence the success of any online business and it’s potential to make money.
Influencing factors to making money online
How successful an online business will be and how much money you will make online will depend on many factors. Some of the most obvious have been listed as below:
- The product or service you are selling
- Supply and demand
- Marketing strategy
- Profit margins
- How hard you work
- The right moment + luck
The product or service you are selling online
It goes without saying that the product you are selling online or the service you are providing will directly influence how much money you can make. I mean, if you were the only company in Thailand selling mobile phones then you can guarantee you are going to be one of the richest people in Thailand and possible the world. In a country with over 70 million people who all have a mobile phone, even if you made a mere 1000 Baht profit per year per customer then you are going to be earning 70 billion profit per year. Yes, that is this many zeros 70,000,000,000 Baht.
But we all know there are thousands of licenced shops selling mobile phones and tens of thousands if not hundreds of thousands of people across Thailand selling mobile phones and all with high rents, big overheads and staff wages to pay.
But imagine if you had one unique copyrighted product that every household in Thailand needed. Now multiply that to every household in the world. I don’t even want to attempt the maths working the profit out there.
So think long and hard about your project or your product. Decide what avenue and industry you want to go down be it technology, food, garments etc. Get a domain name registered and get a website built. Start small to be sensible with the mindset to grow.
Supply and demand
One of the biggest hurdles you will find in the world of business is the supply and demand of your product or service. If you sell a product for example then you must make sure you have a good supply chain and enough to fulfil the demand for your product. If you don’t, then the chances are your customers will simply buy elsewhere. Having an online shop for example with “Out of stock” labelled on so many products is one of the worst things to destroy an online ecommerce shop.
Ask yourself, how many times have you been searching online for a product, you find a website, the price is great, you go to add the product to the basket but you get that annoying out of stock message. The chances are this happens to you a lot. So what do you do? You hit the back button and you shop elsewhere and guess what, that new website you found with the product in stock is now your new best friend and you will hang out with them more often and spend more money with them. Simple, yet so many online web store owners forget the basic principles of supply and demand. So if you have a product in high demand, make sure you have the supply. It can make or break your business.
Marketing strategy & product awareness
What is the point of having a McDonald’s on the moon if A: nobody can reach you and B: nobody knows you are even there. This might fall under the category of opening a restaurant and the famous “location, location, location” principles that apply when establishing a restaurant but I like to use this example when discussing marketing and product awareness and the reason is very simple.
You could have the biggest supply and the biggest demand of the most popular product in the world. But guess what, if nobody knows who you are, where you are, what you sell, how to find you, then your business will fail. We know this because it’s common sense. We don’t have to be told this do we? Then why do so many people fail when it comes to marketing their online business.
“I have to stress again and again that you can not just get a website designed and expect to sit there and let it make money by itself. You need a good marketing and strategy plan and this should be at the top of your to do list.”
So speak to your website designer about an SEO & marketing plan or strategy as they will know how best to market your business online.
Of course how much money you make will also depend on your profit margins. As simple as it is, we can sometimes overlook this. If you are selling one product for example that is not in high demand and the profit margins are slim, then you have to think seriously about your product and the possibility of adding new products to your store to increase the chances of more sales and more profit.
You must also think seriously about your business overheads. The most sensible thing to do when starting an online business is to work from home. If your business grows and you need to hire more staff or larger premises then your business would be in a position to do this.
How hard you work
This should be top of the list without question. Working hard does not simply mean working until you can’t open your eyes or lift your fingers any more. Working hard is about being as productive as possible utilising your time in the best possible way.
Just recently I read about a famous digital marketing agency in Australia who work 4 days a week cut down from 5 days. The digital company have been operating a 4 day working week by giving staff the weekends plus Wednesday off for a little over 1 year and guess what, their company profits and turnover have grown by over 40%. Now one could argue that if they worked a 5 day week then perhaps their company profits might be up by 50% as opposed to 40%. Nope. It doesn’t work like this. They have been in business for over 7 years and it’s the first time they have grown a larger profit margin. Furthermore, the staff are still paid for their extra day off. So the profit margin increase is not down to paying less wages.
So as simple as profit margins might sound, there is just so much that can be done to cut costs or increase costs to make higher profit margins.
“One has to admire any company who do not cut jobs through corporate greed like we see worldwide on a weekly basis. The company directors usually make these decisions while sailing on their private yacht in the Caribbean.”
The right moment + luck
Sometimes we all need a little bit of luck in life and this applies to our business lives as well. But we have to put ourselves into positions where luck might find us. But for every positive there is a negative and at some point we will all experience bad luck in business as well. This is where we must pay special attention to timing and the right or wrong moment to make decisions. Should you throw the white towel? Should you wait until high season? Should you try something new or something tried and tested? So timing can sometimes be the difference with success or failure. Just ask stock-market traders.