Online Business vs Offline

Online Business vs Offline

Some businesses work a lot better as online businesses:

If your business sells really big ticket items like airplanes, boats, or industrial machinery, you can expect to make a lot more sales online than you ever could if you simply relied on people walking through the door of your offline sales office.  The available market of people wanting to buy such things is comparatively small and widely dispersed.  Advertising your products online means you can reach this market more easily and effectively.

Offline business usually operate on fixed hours

With a few exceptions like 7-eleven, the offline business world tends to trade only on certain days at specific times.  .

Online business are always open

When you run an online business, everything is always available 24 hours per day and up to 366 days per year.  The upside of this is you have a lot more opportunity to make sales.

Trust is a major factor in online business

Customers at purely online businesses are largely in the dark about who they’re dealing with, and consequently they are often more reluctant to be a first time customer with an unfamiliar business.   They can’t normally see and inspect physical merchandise before purchasing

  • They can’t be sure that your business really exists
  • They can’t be certain that their transaction will be processed accurately
  • They can’t be certain that you won’t charge additional items to them

Offline businesses require substantial initial investment

Operating from fixed physical locations (or mobile, in the case of ice cream truck drivers), most offline businesses must pay high costs for premises, utilities, and even parking.  The offline business, if it sells goods, will have to maintain a physical inventory, and keep it stocked.

Online businesses are less expensive to establish and operate

Because purely online businesses are location independent, there is no expense for premises, utilities, or parking.  They don’t necessarily need to maintain physical inventory.  In general, an online business is a lot less expensive in terms of input costs, which means there is potential for higher ROI in the long term.

Online businesses usually only need to worry about being maliciously targeted

Security is a really important aspect of running an online business, but physical harm to your business is not possible without a physical location.  Your main threat is being hacked, and there are plenty of ways you can help to protect yourself from that (which is the topic for another article), and you certainly don’t need to insure for as many things as an offline business does. Offline businesses need to constantly worry about crime