In the climate of the prolonged COVID-19 pandemic, it makes sense to operate and manage your own online business. For those employed in an industry negatively affected by COVID-19, such as travel, an online business will add another income stream.
Or perhaps you’ve always wanted to start your own business. Entrepreneurship is a prized dream for many; it represents the potential to make a living out of your passion or hobby. Owning a business also represents being your own boss and the ability to manage your own time.
One of the biggest concerns in setting up any business is the lack of capital. Because an online business requires a smaller budget and less time to set up, the format can aid genesis entrepreneurs. Of course, it goes without saying that just as in any business, an online business will require consistent maintenance and operational support to succeed.
All that said, starting an online business can be the best decision you ever make. Here are the steps to help you on your way.
Have a Business Plan
Step number one on how to start an online business, is to figure out: what are you selling? Are you making tangible products such as nasi kerabu, a family recipe? Are you providing a service, such as writing or graphic design?
There are other models and types of online businesses. You can sell digital products such as an e-cookbook or you can act as an affiliate or reseller for another Malaysian business and get a commission.
The sooner you have an articulated business plan, the better off you’ll be from the start. Try to draft these points:
- What are you trying to do with your online business?
- Who is your target audience?
- How would you differentiate yourself and add value in comparison to competitors? In fact, it is wise to review your competitors to get a better understanding of the market.
- Branding concept/ideas
- An estimation of your cost structure
Don’t worry. Your business plan draft can be a little rough. It should be flexible, especially when you are starting out.
A business plan should act as a solid base. From it, you should have a good idea of where you are going. Having details written from the start would also help you identify areas where you may need external support and keep you from a nasty surprise when you start spending working capital on this online business.
Register Your Business at SSM
Before you can take your online business to market, and to provide a legal status for it in Malaysia, you need to complete a registration process at Suruhanjaya Syarikat Malaysia (SSM) or the Companies Commission of Malaysia. This is a serious matter: should you be found operating an unregistered business, you will be fined an amount not exceeding RM 50,000 or given an imprisonment term not exceeding 2 years.
Plus, registered Malaysian online businesses have a much better chance of applying for loans, financing, and grants. You can register online these days, making the process more convenient.
Below, here are the important components to help you through the registration process:
- Understand your online business type: There are 3 common types of businesses, and you must register accordingly:
- Sole proprietorship, which has only one registered owner. The owner operates the business alone, and business liability is the sole owner’s personal liability.
- Partnership,which allows 2 – 20 registered partners. In a Partnership, you and your partner(s), run the business together and share business liabilities.
- Sendirian Berhad (Sdn Bhd or Private Limited), which requires at least 1 director and 1 other shareholder who cannot be the same person.
Most small businesses, including online-based businesses, are either Sole Proprietorships or Partnerships.
- Create a business name: Part of the registration process includes the application for a proposed business name. The SSM has a useful guideline to follow, so review it before deciding on your online business name. We recommend having a few backup names for your business as you apply. You never know when a name has already been registered by another party. Complete the PNA42 form to register your online business name.
- Select your business category: In this section, you will add a business description and category on the SSM registration form.
For a more thorough delve into the topic, see “Business Registration in Malaysia”
Create Your Online Presence
You can do this in three ways:
- Build a company website for your online business: To have a web address corresponding to your business name, you’ll need to get a domain name. If you’ve completed the registration process at SSM, you would be able to use the provided unique business registration number to apply for a “com.my” domain name to signify that your online business is a homegrown Malaysian enterprise. You can design your website using available templates from web builders such as WordPress, Wix, Shopify or outsource the work to professionals. As a beginning online business, you don’t need your website to be complex or expensive. But it should be user-friendly and well-designed. Keep web copywriting informative, relevant, and helpful to users.
- Create social media accounts to promote the business: Social media accounts double as web/mobile spaces to promote business news and to provide a channel for customers to interact with. You don’t need to create accounts at all social media platforms, just a small curated list you can commit to. Speaking of a channel for customer communications, it helps to have a business email address.
- Decide on an online marketplace: There are a variety of e-commerce platforms to support your online business journey. Creating an online shop using e-commerce platforms saves you the cost of rent, provides an online shop template, affords business visibility to your chosen platform’s users, and delivers access to more payment options. In Malaysia, you can host your online business at platforms such as Shopee or Lazada. You can even open shops on multiple e-commerce platforms. Choose what serves your business needs best.
For more information on local online marketplaces, read “Top 5 Online Marketplaces in Malaysia”
Market Your Brand
So you have a working plan, have completed necessary processes, and own the online space to prove you have a business. Time to advertise! After all, your primary job now is to acquire buyers for your products or services so you can get your cash flow going.
But a brand new online business often faces the challenge of having few website visitors or engagement. To promote your business, try various digital marketing techniques. You can advertise using Google AdWords or boost social media posts on platforms such as Facebook or Instagram. You can also give email marketing or content marketing a try.
Of course, the old method of having your network and loyal customers spread word of mouth will be a great help for online businesses. Share your web pages and channels judiciously to family, friends, and colleagues to start.
Now that you’ve done all of that, your online business is up and running! We wish you the best of luck in managing your online business.
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