7 Advantages and Disadvantages of Online Business | Drawbacks & Benefits of Online Business

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7 Advantages and Disadvantages of Online Business | Drawbacks & Benefits of Online Business

7 Advantages and Disadvantages of Online Business | Drawbacks & Benefits of Online Business
What is Online Business ?

Online business in simple terms is business operations which take place on the internet. Whenever a business setup a website to sell their goods, customers will be buying them though the use of internet. 

Where is Online Business used ?

Since the advancement of internet, it has completely changed the perspective of business. Several industries such as cinema theatre, transport and medical currently use online businesses to reach their customers. There are numerous businesses today that solely depend online. 

Although an online business operates similar to a traditional business, there are distinct pros and cons. These advantages and disadvantages are worth considering before launching an online business enterprise.

In this article, I will be examining about 7 Advantages and Disadvantages of Online Business | Drawbacks & Benefits of Online Business. At the end of this post, you will know the pros and cons of using on online business.

Let's get started,

Advantages of Online Business

1. Long term Cost

Online businesses have significantly lower operating cost compared to a traditional business. An online business require very small office space or there is no requirement for an office space at all. Hence, the businesses could eliminate the cost of renting physical premises. 

Moreover, if there is no physical business premises eventually the expense of hiring employees are also lowered.

2. Customization

The level of satisfaction offered by an online business is far greater compared to a traditional office business. In fact, there is no there is no other business type that offers customization level as an online business. 

In an online business, there are various customization options available for a customer. The customer has to choose one of those and make the order. With these simple procedure, the user experience is increased for a customer.

3. Availability

A business which runs through online does not face time restrictions. Unlike a regular business, it is not with opening and closing time. According to their convenience, customers can perform shopping anytime as long as they are having internet access. Since online businesses run 24/7, it provides more opportunity for sales.

4. Accessibility

Online businesses are also free from geographical restrictions. Customer will be able to place an order from any part of the world. But under the condition of having internet access. This is one of the reasons why organizations prefer online business strategies to target international customers.

5. Adaptation

When you own an online business, you have the right to adopt to the market requirements. Whether it can be a private blog or an e-commerce site, the user has the authority to make updates. Eventually after an update, the visitor can be notified immediately with e-mail marketing and other communication methods.

6. Customer Data

An important part of every business process is to collect customer data. Online businesses allows you to gather customer data and behavior. That too under minimum effort. Using these information, the business could take necessary steps to enhance visitor experience. For an example, if it is an e-commerce site, the business can analyze what product the customers are mostly interested, from which country the most sales comes from and what is the most preferred payment method.

7. Customer Reach

With an online business, it is possible to reach out customers across different parts of the world. Any visitor that comes from any particular location has a tendency to become your business customer. Even smallest business entities has a chance to reach international customers. Eventually, this can target maximum sales which cannot be easily achieved in offline business.

Disadvantages of Online Business

1. Start up Cost

Although online business comes with long term cost savings, it is not the same when it comes to implementation. In here the business must be ready to manage huge start up cost since the website must be designed and maintained by a professional. 

In addition to that, there are also cost inquired from hosting and search engine optimization all which can increase the overall expenses.

2. Security

Not all the people are convenient about making transactions with online business. The rise of internet has got caught the attention of hackers. There are many fraud cases reported worldwide where fake businesses misuse the financial details . Due to this, customers are reluctant to provide sensitive information online.

3. Competition

Running an online business is not an easy process due to the competition involved in the internet world. Always the big companies comes up with better advertising, promotion and even cheaper products all which can take the business away from you. If correct business strategy is not implemented, the business could face substantial losses.

4. Trust

Online business is entirely an internet process. It does not involve any human interactions. Gaining trust from a customer is very difficult thing to build up here. Especially, for the start up businesses without a trusted brand name. It will take some time for the companies to prove that they are legitimate.

5. Customer Satisfaction

Obviously, in online business like e-commerce sites, the customers are not provided with the chance to interact with the products physically. Once the products are delivered to the customer, there is no guarantee that they will be satisfied with it. If the customer do not get what they expected, they might return it possibly.

6. Technical Problems

It is normal for any websites to experience downtimes. Similarly, if your online business site faces such problems, the customers can be greeted with an error message. If the error is not rectified, the same problem can be continued for several days. This could eventually stop customers from doing any business transactions or even visiting your site.

7. Customer Support

In a contrary to a traditional business, an online business completely lacks face-to-face interactions. Now this is a big concern for the customers since most of them prefer direct communication. 

Even though some online businesses offer the option of email, chat or phone call for the customer support still it cannot match the level of support given from a face-to-face communication.


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