Single Operated Newsletter – Why Starting an Online Business is Better than Risking Money on a Brick-and-Mortar Business

Some of our successful students tried the methods (listed below) first.

Then they decided to use our System.

Now they generate thousands of dollars in passive income around the clock each month.

Note: this is the same System that generates millions of searches for our S.O.N. each week (without paid ads, webinars, sales calls, or spending hours on social media).

1. Lower Startup and Operational Costs

Initial Investment Breakdown

One of the most significant barriers to entry for new entrepreneurs is capital. Starting a brick-and-mortar business typically requires a large investment in physical assets. These include:

  • Lease or Purchase of Property: Depending on the location, rent or purchase of a commercial space can range from hundreds to thousands of dollars per month, even before the business opens its doors. For example, a small retail store in a popular urban center might cost between $2,000–$10,000 per month in rent, often with long-term lease commitments.
  • Renovation and Setup Costs: Renovating a space to suit your business can be costly, especially if significant work is required. Setting up shelving, display units, signage, and other physical fixtures can cost thousands of dollars.
  • Inventory and Stock: For most brick-and-mortar stores, maintaining an inventory is a significant cost. For example, a retail store selling clothing, electronics, or food products will need to invest heavily in stock upfront—sometimes tens of thousands of dollars—without knowing how much will sell.
  • Utilities and Maintenance: Monthly utility bills (electricity, water, internet, etc.) and maintenance fees add up, even before you make your first sale.

In comparison, starting an online business can be far more cost-effective. The essential costs for an online business include:

  • Domain Name and Hosting: A domain name typically costs around $10–$20 per year, while reliable web hosting services can range from $5 to $50 per month, depending on the platform and business requirements. For example, if you build a store on Shopify, your monthly cost for hosting, transaction fees, and app integrations could range from $29 to $299, depending on your chosen plan.
  • Website Design and Development: Platforms like WordPress, Wix, and Squarespace provide affordable, customizable website templates. If you hire a web developer to create a custom site, the cost can vary between $2,000 and $10,000, depending on the complexity of the design.
  • E-commerce Platform Fees: Platforms like Shopify or BigCommerce charge a monthly fee, but these can often be lower than the costs associated with physical stores. Shopify’s basic plan costs about $39 per month, while WooCommerce (on WordPress) is a free plugin, though you may need to pay for premium themes or additional plugins.
  • Inventory Management: For e-commerce businesses, especially those using dropshipping or print-on-demand models, inventory management is significantly cheaper because you don’t need to store products yourself. Instead, suppliers manage stock and fulfillment.

This dramatic difference in initial investment—often only a few hundred or thousand dollars for an online business compared to tens of thousands for a physical store—makes online businesses more accessible to entrepreneurs with limited capital.

Ongoing Operational Costs

Once operational, the cost dynamics differ significantly. A brick-and-mortar business faces constant overhead costs that an online business can avoid:

  • Employee Payroll: Hiring employees for a physical store means paying hourly wages or salaries. For example, you may need sales associates, a manager, cleaning staff, and security personnel. This can add up to a significant monthly expense.
  • Rent and Utilities: As mentioned earlier, this is an ongoing burden that online businesses don’t face.
  • Marketing and Advertising: Online businesses typically have lower costs for digital marketing campaigns compared to traditional media (TV, radio, print). Platforms like Facebook, Instagram, Google Ads, and email marketing allow entrepreneurs to target their ideal customers with precision, often on tight budgets.

With these operational differences, online businesses are far more cost-efficient in the long term. Entrepreneurs can reinvest saved funds into improving their website, marketing, or product development.

2. Greater Flexibility and Autonomy

Location Independence

For a brick-and-mortar business, you’re confined to a specific physical location. This has clear limitations:

  • If you open a retail store in a small town, your customer base is largely restricted to the local population, and growth is confined by the region.
  • Operating hours are fixed, and you need to be physically present to monitor the business or oversee employees.

In contrast, an online business can operate from anywhere. You can manage your business from your home, while traveling, or even from a different country. A real-world example of this is Chris Guillebeau, a best-selling author and entrepreneur, who ran his business from different parts of the world, including Europe, Asia, and South America. The ability to work remotely adds significant freedom and autonomy to the entrepreneurial lifestyle.

Work-Life Balance

With a brick-and-mortar business, maintaining a healthy work-life balance can be challenging. You may need to oversee your store during extended hours, especially on weekends or holidays when foot traffic is highest. On top of that, you may be constantly on call for emergencies, such as inventory shortages or staffing issues.

On the flip side, many online business models allow for more flexibility. Digital product creators, for instance, often rely on automated systems to handle sales, customer support, and fulfillment. As a result, they can set their own hours, spend more time with family, and even take vacations without worrying about the daily grind.

3. Scalability and Growth Potential

Expanding an Online Business

Scaling an online business is generally easier and more cost-effective than scaling a physical store. Here’s how:

  • Geographic Reach: An online business has the potential to reach customers across the globe. For instance, Shopify reports that its top 5,000 merchants collectively ship to more than 175 countries. The ability to tap into international markets gives online businesses a larger pool of potential customers than a physical store ever could.
  • Automation and Tools: As an online business grows, you can use tools to automate processes such as email marketing (via platforms like Mailchimp or ConvertKit), social media posting (using Buffer or Hootsuite), customer support (via live chat systems or AI bots), and inventory management (through systems integrated with your e-commerce platform). This allows you to scale without dramatically increasing your overhead costs.
  • Outsourcing and Remote Teams: As your business grows, you can hire remote workers or outsource tasks (e.g., graphic design, customer service, content writing) through freelance platforms like Upwork or Fiverr. This is far more cost-effective than hiring full-time employees and having them work on-site in a physical store.

Scalability of Physical Stores

Scaling a brick-and-mortar store often requires significant investment in new locations, personnel, and logistics. The growth process can be slow and costly. For example, opening a second location means negotiating lease agreements, fitting out new space, hiring staff, and potentially increasing inventory. It may take years for a new location to break even, let alone become profitable.

4. Access to Global Markets

Global Audience Reach

With a brick-and-mortar business, your potential market is limited to the local population, and expanding beyond that often involves opening new locations in different cities or countries. This can be a slow, capital-intensive process.

In contrast, an online business can reach anyone with an internet connection. For instance, a Shopify store can sell to customers in countries where you don’t have a physical presence. The cost to expand internationally is negligible compared to opening a new physical store, and shipping logistics can be managed through third-party services. In fact, platforms like Amazon have made it easier than ever to access global customers through marketplaces in multiple regions.

Marketing to a Global Audience

Social media and search engine marketing allow you to target potential customers on a global scale. With SEO (Search Engine Optimization) strategies, content marketing, and paid ads on Google, Facebook, Instagram, or YouTube, you can tailor campaigns to reach specific regions or demographics. Unlike a brick-and-mortar store, which is dependent on foot traffic, online businesses can use digital advertising to drive qualified traffic to their website.

5. Reduced Risk and Increased Resilience

The global digital landscape has proven itself more resilient than traditional retail models in the face of economic downturns or global crises. During the COVID-19 pandemic, for example, businesses that relied on e-commerce were able to adapt much faster than physical stores. Many brick-and-mortar businesses were forced to shut down, whereas online businesses continued to operate—often even seeing increased demand due to the surge in online shopping.

Furthermore, online businesses can adjust their product offerings, marketing strategies, and services quickly based on customer feedback and trends, whereas a brick-and-mortar store might need to undergo lengthy and costly physical changes or renovations.

Conclusion

In today’s digital world, starting an online business offers numerous advantages over launching a traditional brick-and-mortar store. With lower startup and operational costs, greater flexibility, scalability, and access to global markets, online businesses offer an accessible and cost-effective path to entrepreneurship. For many aspiring business owners, especially those with limited capital or those seeking work-life balance, the online business model provides an unparalleled opportunity for growth, autonomy, and success. By tapping into the power of the internet and automation, entrepreneurs can reduce risk, maximize reach, and ultimately build a thriving business from anywhere in the world.4o mini