How to start an online business in the UK

Online businesses come with many benefits. You can reach a global audience despite residing in one country. Almost every type of business can be run successfully online, but many people are unaware of how to set up an online business. This article explains how to start an online business in the UK.

The main steps to take include

  1. Conduct Market Research

You must research the market to see if your business idea is viable. Ideas are a dime a dozen, but the execution is what matters. You may think you have a great idea, but if there’s no valuable market for it, the idea is as good as dead. 

Study how big the market you want to enter is. Who are your main competitors, and how do you plan to stand out? Who is your target customer, and how do you plan to lure them? What are the growth prospects for the market? Is it a rapidly-growing market or a dwindling one? These are the types of critical questions to ask.

You can conduct the research yourself or hire a professional market research firm.

  1. Choose A Suitable Business Model

There are many options to make money online, and you need to choose the right one. The suitable model depends on your type of business and what you plan to offer customers. Options include


You can create an online store to sell physical or digital products. You can also sell your products on third-party online marketplaces like eBay, Etsy, Amazon, etc. Many retailers choose the latter option initially because finding customers is easier this way. After gaining a substantial customer base on third-party marketplaces, they switch to their dedicated websites.


You can charge customers recurring monthly or annual fees to access your services. This model primarily applies to digital products and services. For example, you can create an online tutoring service and require customers to pay $10 monthly to access the learning content.

The advantage of this model is that it brings in stable revenue, and it’s easier to forecast revenue growth. The disadvantage is that it takes more effort to convince customers to subscribe than to pay a one-time fee.

It’s advisable to offer basic versions of your service for free and require a subscription to access advanced features. This model is known as freemium.


You can offer your online services for free and earn money by charging brands to advertise to your audience. For instance, many blogs are free to read and make money from advertising. The drawback of this model is that you’ll need to build a sizeable audience before earning worthwhile revenue.

  1. Create A Business Plan

You need to create a formal plan for your business. This plan explains your product clearly and what it offers to customers. It highlights your company’s strengths and weaknesses and how you plan to win customers. 

A business plan should be easy to read and understand. Any layperson should be able to pick it up and understand what you’re selling. This factor is crucial if you plan to raise money from outside investors.

  1. Build Your Website Or Online Store

The next step is to build your company's website or online store. You need to choose a good web hosting provider and a website-building platform. The good news is that many website builders allow you to create sophisticated websites easily. You don’t need to hire a computer programmer to build your website, although that may help. 

Examples of website builders include Wix, Weebly, Shopify, Squarespace, etc. Shopify specializes in e-commerce websites; you can integrate it with a payment gateway and easily accept money from customers.

Your website should be well-optimized for mobile displays, as most internet traffic comes from mobile devices.

  1. Register Your Business

You should register your online company with the British Companies House and HM Revenue & Customs (HMRC). Incorporation makes your business look more credible to customers and fellow businesses. Registration with HMRC is required to comply with tax laws and responsibilities. 

The most popular type of company to register in the UK is a limited company. 

  1. Build a Brand And Online Following

Now, you have fulfilled all the requirements of how to start an online business in the UK. The next step is to start selling your products and earning money. You must build a loyal customer base and brand following to increase your chances of making money. Create social media pages for your company and interact with customers. Optimize your website to rank high on search engines and attract organic traffic.

You can advertise on social media and search engines to draw eyeballs to your website and convert some of them into customers. It can be challenging, but you can figure it out and build a successful company with time. 

Also, ensure you comply with advertising and data protection regulations to avoid legal headaches. The online world is your oyster at this point.

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