Why do people get into business? Fundamentally for income. So perhaps the most important consideration in choosing an online business is the income model.
Income Potential
For example, consider overall income potential. If you want to earn an extra $1000/month, you probably don’t want to choose one that offers an income potential of $10,000/month. You say “sure I only want 1K, but I wouldn’t turn down 10K either!” Here’s the rub: the work required to create the 10K / month success may be more than you wish to undertake, and the business may not function at the lower income level. So find a match for your goals.
Not sure what your goals are? Here’s a quick 3 step exercise to determine what kind of income your dreams require.
- Jot down a list of the things you would like to be able to include every month or year. Travel goals, family goals, helping others goals, learning and doing goals, philanthropy goals.
- Beside each item on your list, jot down how much it would cost to make that a reality.
- Add up your list. Now you know how much income you need, in addition to your living expense costs, to be able to fulfill your goals.
Don’t be afraid of big goals, or big numbers. Far too often we limit our dreams to what we can afford. Far better to create our income to fund our dreams!
Time to Sustainable Income
Next up is the time it takes to create the income. The “on-ramp” time. This can vary from 3-6 months to 3-5 years. How soon do you want a return? I know it sounds like a no-brainer, we all want immediate return. However, it is important to actually address this, not just assume that all businesses have the same on-ramp time.
Of course, individual success in a business depends on individual effort. Keep that in mind as well. A business that offers a 50K/month return will only do so if the correct steps are followed with an appropriate level of effort and mindset.
The business model will also indicate ongoing business expenses. This is a big factor in the attractiveness of online businesses: the upfront and ongoing expenses are so low. However, you do need to know exactly what expenses you can expect. Our checklist will give you an idea of additional unmentioned costs. If an essential feature is not included in the business model, then it becomes an additional ongoing business cost.
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