Building a business: Online or offline?
Singapore is a great place for global as well as local businesses to set up their headquarters. Strong trade and investment make Singapore a ripe territory to start a business. Its taxation laws and agreements are favorable for anyone who wishes to set up their business. Be it in the online or offline format, businesses have favoured Singapore as their headquarters. But whether you want to opt for an online business or an offline business depends solely on the type of business and your future business goals. Both of them have their own share of advantages and disadvantages. The debate between online business vs. offline business is therefore an unending one.
The stats show a definitive leaning of businesses towards the e-commerce and brick and click way of operations. The estimated e-commerce user penetration in Singapore was at 57.31 % in 2015 and is expected to hit 74.20 % in 2020. The increasing usage of online channels for consumer purchases makes it necessary for a whole lot of businesses to have an online business. But whether you should solely have an online presence or an offline presence, is yet to explore.
Online Business
The biggest advantage of having an online business is that it helps you save a lot of capital. Online businesses neither have to invest in expensive retail space nor hire store personnel. This reduces operational costs considerably. A lean cost structure gives companies more flexibility, especially if there is a sudden downturn. With effective information management systems and sophisticated software, it has become fairly simple to do business online.
Small businesses can reach a worldwide customer audience through simple e-commerce websites. An online venture offers convenience to customers, who can browse product reviews and place orders at their leisure. Customers can purchase your goods and services 24×7. This is a luxury that they don’t get in traditional brick and mortar stores.
A lot of people are making money through online businesses through various ways such as content based websites, product affiliation marketing and selling products. Today, there are great strategies in place and one of the most accredited one is the E-commerce strategy. Many people now understand the importance of doing business through web. With time, people have been able to build trust in online business and due to that, it has become the most amazing business practice invention. The online business is easy to start, however, it is difficult to succeed in a long run. In order to sustain, you have to keep investing in technology and data analytics to be one step ahead of the consumer and your competition.
Offline Business
Unlike online ventures, offline businesses can establish personal connections with their customers, which can build loyalty. Some customers may prefer to buy only after touching or trying on a product, which may reduce the number of product returns for certain businesses. The offline model is the only option for many businesses. For example, although a restaurant can advertise on social media or put up its menu online, it obviously cannot serve customers online. Similarly, a car dealership is unlikely to be as effective without its sales staff walking buyers through the buying or leasing process.
Offline ventures lease or build facilities for their customers, while e-commerce websites are global storefronts for online companies. The market for an offline business is usually limited. For example, a restaurant’s clientele may live within a 10-mile radius, which could restrict the owner’s growth opportunities. Several traditional business ventures, such as bookstores and video rental stores, have become unprofitable because they cannot compete with the low-cost structure of their online counterparts.
When customers buy from offline businesses, they usually don’t need to worry about being scammed. Besides that, they have a really good opportunity to thoroughly inspect the merchandise before paying for it. In the world of offline business, you don’t normally have to worry about losing sales because customers don’t trust you, and you don’t normally have to do anything to convince them they should trust you.
Businesses can use both online and offline models. For example, newspapers have built online portals that incorporate multimedia and interactivity to enrich the reading experience. A bank’s customers can view their accounts, transfer funds, and pay bills online, but they can also go to a branch to make a loan application or to withdraw cash.
Why take your offline business online?
There are a million reasons for taking your offline business online. Firstly, it will improve your online image and help you gain visibility to a broader audience. In fact, by going online, you would get a better chance to understand the pulse of your audience through social media interactions. The internet allows you to answer questions and customer problems in a systematic manner. Companies usually have a chatbox or an e-mail option for customers to send their feedback and queries.
Building a business online or offline depends on the type of business and the resources you are willing to invest in your business. Choose what works best for you, but remember that even an offline business runs brisker if you have some sort of an online presence. Neglecting the power of having a digital footprint can cost you!
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