traditional business vs. an e-business are similar in scope to the competitive coexistence that authors and readers see between print vs. electronic book publication. Although a brick-and-mortar shop and an online marketplace are both "real," they appeal to different demographics, showcase their goods through different methods and offer consumers different levels of pricing, service and convenience.
Needs Assessment
The nature of your small business and the type and amount of customer interaction it requires to be successful dictate whether you need a physical address or a virtual one. If, for example, you're providing writing, copy-editing, consulting, accounting or billing services, the primary interface with your clients is by phone, email and fax, negating the need for work space beyond a home office. Conversely, a small business in which you sell apparel, cosmetics, jewelry, art, furniture or home accessories will likely require display space, dressing rooms and appropriate storage.
Legalities and Expenses
Traditional businesses and e-businesses both require you to have a business license. Registering your business name with the state registrar, acquiring a federal tax ID number, researching local zoning and licensing regulations, purchasing insurance pertinent to your needs and establishing banking relationships are critical steps in setting up shop in either venue. While telecommunications equipment, office supplies and a marketing/advertising budget are necessary expenses in both traditional and electronic commerce, a traditional business model has the added overhead of a monthly lease, utilities, staff salaries and benefits, exterior/interior maintenance costs and security systems. An e-business run from a home office utilizes resources that already exist and which are then prorated as deductions for tax purposes.
Customer Convenience
If the weather is bad, the parking is a challenge or the hour is late when inspiration strikes to buy something, an e-business that is open 24/7 often has more appeal to customers than a brick-and-mortar shop located across town and only open five days a week from 10 to 4. Shopping for goods electronically doesn't just save customers time and energy; it can also save them from paying sales taxes, provide them with more outlets to comparison-shop and eliminate the feeling of being pressured or followed around by a salesperson. Many customers, however, prefer the ability to personally inspect the merchandise, ask for advice and assistance and be able to take their purchases home immediately rather than having to pay shipping costs and wait for delivery. A traditional business satisfies those needs in addition to fostering an environment of trust through personal conversation and face-time.
Home vs. Work
As a small business owner, you are just as likely to obsess about its well-being whether it's 10 miles away or just down a hallway. Being able to separate your work life from your personal life is often a greater challenge when you and your job live under the same roof. The 24/7 nature of e-business makes it all too tempting to start perceiving yourself as accessible to your customers round-the-clock, something that would not occur if you kept traditional hours at a store. Instead of the expected freedom to manage time on your own terms as an e-entrepreneur, you could actually find yourself a slave to your own computer. While emergencies can come up in either scenario that require flexibility or "overtime," be mindful of your own needs to rest, spend time with family and pursue creative outlets. In other words, recognize when it's time to lock that virtual door and call it a day.
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