💰 Top 5 Online Businesses In 2020 For BEGINNERS To Start Now 💪 (Low-Cost Online Businesses)
– Hey everybody, so one of the most common questions that I get asked is what business should I start, Sarah? And so I decided to answer that question today and give you my five top business ideas for this year that not only make money but are low cost to start. And I know that what is considered cheap and “low cost” is relative. But you know, when you think about it, in the past, if you wanted to take control of your financial future, you would usually have to spend hundreds of thousands of dollars a month renting a store or a building, and then you would have to spend hundreds of thousands of dollars a day hiring staff members to run it.
And then you’d have to spend thousands of dollars on purchasing products in bulk to resell or before you had sold a single thing. But now, thanks to the Internet, we can sell products and make money doing so online 24/7 without having employees thanks to digital storefronts. It costs just $29 a month to run. And thanks to the Internet as well as we will discuss. We can now say good bye to having to buy products in advance to sell for a profit. In fact, as you’re gonna see, thanks to the Internet, we can now sell products that don’t even exist yet. And something I wanna keep in mind is that these businesses, they do have static costs. However, if you’re in a tight spot financially and it would be better for you to start with something that’s free, then there are indeed free ways to get started, which I talk about in this video.
In short, those methods will definitely take longer to get traction, but you know what? Business, it isn’t a sprint, it is a marathon. So don’t feel like you have to spend any money or put yourself in financial strain to start a business. There are plenty of ways to get started for free. However, if you do have some money to invest to start a business and you’d like some ideas for what you could do, then this video is for you. And keep in mind, everybody has their own personal strengths So you might be listening to this video and being like, oh, business one, business two, those aren’t for me. But you know what? Business three, that is the one that’s calling my name. So keep listening so that you can see all of the ideas on this list. Business idea one, start making money on Etsy. Now I know a lot of my subscribers already know a lot of the businesses that I love, so I wanted to kick this list off with something that would be a bit more surprising for them and something that I’m still very passionate about, but I just don’t talk a lot about on this channel, and that is Etsy.
And I honestly think that Etsy could very well be the most underutilized third party platform for making money online right now. There are so many opportunities to make money on Etsy and yet everybody shies away from it. And I’m honestly not really sure why. I suspect it could they because the fact that there is a 20 cent per item listing, although it does last for four months, but then a lot of people look at eBay and they go, oh, on eBay, it’s free to list items for up to 50 items. The thing though is that as you’re gonna see, Etsy has some major advantages over eBay. So there are two major ways to be making money on Etsy right now that are currently underutilized.
And the first one I’m gonna talk about is digital downloads. In fact, I’m gonna be showing you one store that in less than two years has made nearly $200,000 with automated digital downloads. All right, so here’s Etsy. For those of you that don’t know, Etsy is an online marketplace that over 35 million people visit each year where anyone like me or you can list out products for sale. It’s just like eBay. With eBay, you can list products for sale and when you do, anyone can come and buy them. So if I come to the search bar and type in funny t-shirts, eBay will show me a bunch of funny t-shirts that third party sellers like you or me have listed for sale Well, Etsy is the same.
If we come to Etsy and type in funny t-shirts, we’ll get a bunch of funny t-shirts that people are selling on Etsy. So when you come to a t-shirt and buy it, you aren’t buying it from Etsy, you’re buying it from a third party seller who is most likely just operating out of the house. Etsy initially used to be a marketplace just for handmade products, but it’s completely evolved and now you are allowed to sell lots of different products. And there is one major advantage to selling on Etsy compared to eBay. You see, unlike eBay, Etsy has marketed itself as a premium buying experience. Because of that, as you can see, on average the t-shirts on Etsy are priced 50 to 100% higher than what they go for on eBay. So you know, Victor Ho making $200,000 in less than two years’ thing. I was looking for some new t-shirt mockups for a store, my eCommerce portfolio that I recently highlighted in this video, and if you don’t know what a t-shirt mockup is, it is a photo that has a blank t-shirt that t-shirt sellers like me can place our designs onto and use for marketing.
And as I was after a very particular type of mockup photo, I decided to check on Etsy. The main way that customers find products on Etsy is with the search bar. Etsy will then go through its listings and see which ones are relevant with matching keywords and then give you results. So I did a search for what I wanted, Bella canvas 3005 mockup photos and looked through the different results until I found this one here, which was exactly what I wanted. And after the purchase, I was automatically sent an email that contained a direct download with the mockup photo.
And oh my goodness, me, have they sold a lot of mockup photos. So, I switched the currency United States dollars and check this out. The store here, they’ve been on Etsy for less than two years and yet they have sold nearly 57,000 photos. So if we take out a calculator and average $3 50 a photo since, as we can see, they do sometimes put them on sale, that means that in less than two years selling automatic digital downloads, this store has made just under $200,000.
And I just wanna be clear, this is not to minimize the work that the store has put in. But as you can see, putting in real work to actually create real products that people want to buy, rather than chasing off to get-rich-quick schemes, it literally pays off. And you know, I’ve seen even simpler, more creative ways that people are making money on Etsy with automated digital downloads. I mean, take a look at this. This is a sizing chart picture that you could get a graphic designer on Fiverr to create. People are buying these sizing shots for $5. And the amazing thing is that there are still opportunities to make money in the mockup photo business on Etsy. So for example, the store here, yesterday, I was thinking about how I’m going to expand its product line. And I was thinking, hmm, crop tops could be a good option. Crop tops are becoming increasingly popular with print-on-demand stores like mine. So I went to Etsy to do a search for nice mockup photos for this crop top, and to my disappointment, the options were extremely limited to say the least.
No one has taken this opportunity to create nicely laid out crop top mockup photos. So that is one semi passive underutilized way to make money on Etsy. But there is a nother semi automated way to make money on Etsy and that is with print on demand. I know that my usual subscribers already know what print on demand does, but you have to understand, I get a lot of new subscribers here every day. So for those of you that don’t know what print on demand is, there are services out there like this one, Printful. What they will do is they will let you upload artwork to their website and place it digitally onto products like t-shirts. You can enlist these products in your store and then when a customer comes and buy, say, this t-shirt for $21 and 95 cents, you then pay Printful the base cost of the t-shirt, which in this case here is around $7 and 95 cents, Printful will then print the design onto a t-shirt for you, package it up and ship it out to the customer automatically without you having to do anything while you keep the difference as profit.
This is what print on demand is. It’s essentially when you sell custom-made merchandise before it exists yet. And to really begin to freely speak to it, is that you only have to purchase each product after the customer has already bought it from you. Print-on-demand stores have flourished on Etsy for two reasons. One of the reasons is that because of the fact that Etsy has marketed itself as a premium marketplace, you can increase the prices, which means a higher profit margin for you. And secondly, two of the biggest print-on-demand providers, Printify and Printful have integrations with Etsy, making it super easy to set up a semi automated store.
Here’s an example of a top selling print-on-demand mug on Etsy. It features just simple text and a photo of Donald Trump. Now, technically Donald Trump’s image is protected under the personality rights law, but 99.9999% of time, politicians will let you use their image on products and they don’t care. It’s considered socially beneath politicians to care about things like this, and this mug, it’s sold like crazy. People absolutely love this mug. And if we go and open up this Etsy print-on-demand store, we’ll see that they have made many other designs, largely simple takes based ones and cheek this up.
They have also been on Etsy for less than two years, and look, they have had over 43,000 sales. So if we come and calculate how much money they’ve made in less than two years, well, we can say that it’s literally hundreds of thousands of dollars even after fees. And if we scroll down their store page, we’ll see that, yep, they are using print-on-demand providers to print and sell their products, they are using two, Gearbubble and Printful. The store took action and well, you know, it’s paid off literally. So I think that Etsy is a fantastic place to start a business if you wanna take advantage of a third party marketplace that has free traffic coming to it every day.
Of course, if you like the idea of starting a print-on-demand store, but you want to make even more money than how much you can make on Etsy, then perhaps you want to keep listening to the sneaks business. Two, start your own print on demand store. Yes, here’s the honest reality. If you wanna start a print on demand store that is a seven figure store, then you need to sell on your own website, not a third party platform like Etsy.
You don’t need storefront Outwork with an investor in to these days like Shopify because it’s genuinely is simple, easy and reliable to use. There are several Shopify plans. And for most beginners, the $29 a month plan is perfect. So why would you wanna open up your own store on your own domain name rather than selling on Etsy? Well, there are several reasons, but one of them is that you control the customer’s journey. See, in my own store, I can add upsell apps that will encourage the customer to order more than just one item.
A great way to increase the amount of money you make per customer, and the more money you make per customer, the more money you can afford to reinvest and grow your store. But on Etsy, well, you can’t do that. What they usually maintain is that when you sell products on Etsy, your average order value is most likely going to be less, i.e, customers spend less money per order. That means in each your profit margins are smaller, which normally means that they’re not big enough to be able to afford to run external advertising. I have a good friend Adrian. We both became friends because not only are we both interested in eCommerce, but we both went for the extensive ordering process of becoming a Shopify approved education partner, which means that if you see any income screenshots, you know that they are legitimate. Here’s a snapshot of this print on demand store that he sold millions of dollars with print on demand products, his biggest seller being his leggings. And do you know where most of the sales came from? They came from external Facebook advertising campaigns.
You see, here’s the reality. On Etsy, you have the potential to reach the 35 million people that come to the website each year. But if you advertise on Facebook, you have the opportunity to reach a billion people. So yes, this is why. If a million dollar store is your ultimate one day go, then really you need to be willing to open up and advertise in your own store.
But of course advertising is absolutely useless if your products aren’t good and nobody wants to buy them. I was recently chatting with Adrian and I asked him could he give our viewers a quick tip on how to create products that sell well with paid ads? – I personally have done over $3 million in sales on my own Shopify store selling products that I don’t see, touch or ship. It’s all print on demand. We’ve done about $900,000 in sales of leggings with pictures of dogs on them. We’ve sold pillow covers with pictures of wine on it. If you wanna start a print on demand business, let me tell you something right now. The craziest funnest, most ridiculous images are the ones that can differ. – And I completely agree with Adrian.
Remember if you’re advertising on external platforms like Facebook or Instagram, you are competing for your customer’s attention. So you need to make sure that your designs are very attention grabbing. And not just a little minimalist logo in the corner of a shirt. Something else to keep in mind though is that when it comes to print on demand, you’re not just stuck doing either or of these businesses, you can take advantage of both. Like Smash Transit. They run a successful print on demand store on Etsy and they run their own store in Shopify too.
See, you know, you’re not just limited to one, but I can imagine a bunch of you out there thinking, well, Sarah, that’s great, I know, but I don’t wanna have to make my own products. I wanna start a business that sells products that have already been made and have already been proven to be successful. And if that’s you, then that’s all good. Keep listening because the next business might be the right one for you. Business three, use Amazon to sell copyrighted products. With this business model, you don’t have to create your own products. Instead, you can sell already popular, copyrighted, trademarked products. And that’s what I’ll show you. You can take the money you earn and scale this business up and up so that one day you might even cross the million dollar mark yourself.
So here is the deal. Does you know that most products, even very popular products like this dog toy aren’t sold by Amazon themselves? Nope, they’re actually sold by third party sellers like me or you. So you might be thinking, okay Sarah, I see that every month over 2000 people are buying this dog toy on Amazon and spending over $30,000 but how can I buy this toy at a discounted price to resell on Amazon for a profit and take a slice of the sales for myself? Well, one of the easiest, cheapest and most beginner friendly ways to do this is with something called retail arbitrage. With retail arbitrage, you basically source products like this dog toy from other retail stores.
So, here’s how it works. What you do is you walk on into a local retail store like Walmart or Target or your local supermarket. You go to stores like that and you look at the items that are selling, especially the products on sale and you compare their on sale prices to their going price on Amazon. And if you find an item that is priced higher on Amazon, then woohoo, you’ve got to hit. So what you do is you buy as many of the sweating products as you can and then package it up and then ship it into one of Amazon’s FBA fulfillment warehouses. Amazon will store your products for you and you can set your price. Then when a customer comes and orders your product from you on Amazon, Amazon’s warehouse staff will find your items stored there. They’ll package the item up and ship it out directly to the customer, and it will arrive in one of Amazon’s classic boxes. The service is called Amazon FBA, otherwise Fulfilled by Amazon. It’s a done-for-you service that handles all of the storing, packaging, and shipping of the products, while of course, you get to keep the difference as profit.
This is a great first business for a lot of people because it makes a lot of logical sense. You go into a retail store, you purchase an item that’s on sale for cheaper than what it is on Amazon, and then you go and you relist it on Amazon for its full price. No all customers in the world have access to your local retail stores with your local retail stores on sale prices. They only have access to Amazon and you get to take advantage of this. Plus Amazon actually makes this business even easier for you because of something called the Buy Box.
For example, let’s take this dog toy here. This is a very popular dog toy. As I showed earlier using the Amazon sale estimator tool, Jungle Scout, we can see that it estimates that more than 2000 of these medium sized toys were sold within the past month, which is over $30,000 in sales. Now when you come to buy it from Amazon, you might think that by clicking this Buy button, you’re buying it from Amazon, but you’re not. You’re actually buying it from a third party seller. In this case here, it’s UnbeatableSale, Inc. However, if we check out the Amazon list of sellers, we’ll see that there are seven of them selling this exact same toy. So why did Amazon choose to list UnbeatableSale, Inc as the person we buy it from when we click the Buy Now button. Now this is a little simplified, but essentially, this is what the algorithm does. It goes, okay, who is storing and shipping their products from Amazon? Oh, six of these seven sellers are, great.
We’ll exclude the one that isn’t, Royal Pet Kingdom Europe from the list. Next of course, who of these people left are selling it within a dollar of the lowest price? Oh, six of these sellers are shipping it from us and they’re all priced very closely. Or of course, in this case, priced equal. Great, we’ll all take and split these six sellers so that they get roughly 1/6 of the sales for this toy each. So that means that roughly Amazon will give each of these sellers enough Buy Box time to get about $5,000 each. But that’s how this business starts off when you’re beginning. You get small amount of money, you buy a small amount of products on sale, you send them into Amazon, you sell them for a higher price, you flip them, repeat.
I know that Gary Vaynerchuk recommends flipping as a great first business for people because of course it makes a lot of logical sense. You buy somewhere cheap and then you resell for a profit elsewhere. And this is just a different twist on that business model. However, once you’ve got some capital that you’ve built up from doing this, you can take it a step further. I have a good friend Dan, and he was on Amazon Seller doing retail arbitrage, who had the smart idea of going, wait a minute, you know what? Instead of going into retail stores each and every day to look for products like this on sale, let’s just go straight to the manufacturer and buy them in bulk at discounted wholesale prices and ship them into Amazon. Buying direct from manufacturers at discounted wholesale prices and then reselling for the retail price is very punchy, tried true strategy.
However, the moment that you do this, the business it’s no longer cheap because now you gotta buy products in bulk. However, while it may no longer be cheap, it kind of makes up for it and the fact that it becomes extremely passive because once you’ve negotiated your wholesale agreements, all you’ve got to do, it’s to make sure that your inventory levels on Amazon don’t get low. When you see that they’re getting low, you just call up your wholesaler and order more products to sell and ship them into Amazon who will then take care of the rest for you. And so I asked him what his favorite part of the business was and he agreed that yes, the upfront money in the beginning meant that he definitely had to make some sacrifices.
However, now that he’s got a passive business, he does not have any regrets. And I’m gonna switch to his clip in a moment, but just wanted to give people a bit of a warning because people say that I talk pretty fast, but Dan actually talks even faster. – Here’s an example of just two of our current wholesale accounts over the past 12 months. Keep in mind that we have more than 40 active wholesale accounts.
I meet with my team of three employees about once a week and that’s it. I mean, I’m gonna be honest with you, it was really hard in the beginning, but if I had it to do all over again, I would do it every time. – But of course, not everybody has the money to invest upfront into products that have already been manufactured to resell. So if that’s you, but you still wanna sell products that have been manufactured rather than creating your own merchandise, then perhaps the next business is for you. Business four, start a drop shipping store. I’m not gonna spend too much time on this business model because we’ve got lot of videos about it already on this channel. I even have a free ebook which goes into deeper detail about how this business model works, and if you’d like to download that ebook, “The 6 Steps That Six Figure Online Stores Follow “To Make Over $10,000 a month”. You’ll find a link to download that ebook in the video description below. But basically, drop shipping is by far the cheapest way to start an online eCommerce store if you don’t want to have to be creative and come up with your own products to sell.
You see, most people think that if I wanted to sell this cute cake coffee spoons that have been hyper viral, that I would have to go to the manufacturer for them, order a bunch of them and get them shipped to my house and then each time a customer comes to my store and buys them from me, I then need to go package the spoons up and ship them out to my customer.
But you know what, that’s not true. There are a lot of manufacturers out there that offer an additional way to purchase products from them, such as the manufacturers for these cute cake coffee spoons here, and that service is drop shipping. Drop shipping is when a customer buys a product that you’ve listed in your store for a market price. When they do, you go to the manufacturer and you purchase that one product for the wholesale price. The manufacturer then ships that product out to your customer for you and you get to keep the difference as profit. That’s it. It isn’t magic, it isn’t a get-rich quick scheme. It’s just a different way to purchase products from manufacturers. And in fact, retail stores have been drop shipping since the ’70s.
In fact, here in New Zealand, one of our largest online stores, Fishpond, that sells millions and millions of dollars each year, it is one ginormous drop shipping store. So where do you find manufacturers that will let you drop ship products from their catalogs? Well, one of the easiest places to find drop shippers that are willing to do this is AliExpress. This is an online directory of Chinese manufacturers that will list their products that they manufacture here so that you can buy them individually. And don’t worry, these days a lot of them have supply warehouses in the USA. All you need to do is set the search settings to show you the ones that will ship products domestically so that you can drop ship with four to seven day shipping time and no paid app required, and there are lots of great products to drop ship within the USA such as this LED dog collar.
And do you remember my friend Adrian? Well, the money he’s made in the store, it’s not just from print on demand products, it’s actually a flake store, which also sold millions of dollars of drop ship products from AliExpress such as that LED dog collar. He sold over $700,000 of LED dog collars. While I was chatting with Adrian, I asked him why he thought the LED dog collars sold so well for him and to also give our viewers a tamp on choosing good products to sell. And here’s what he said. – I encourage you to pick a passion that you know people are very interested in. Like for example, dogs is a phenomenal passion. Everybody loves dogs. Everybody loves cats. These are things that are easy to sell in the drop shipping market.
And then you could start getting into some more unique products. – Very good advice. So onto the next business. Business number five, create and sell your own educational online digital products. So I actually have a premium tutorial video course that contains additional videos not available on this channel to help new entrepreneurs set up and launch their own online stores. It’s called the Econ Clubhouse. Now some people see this and they get a little bit salty and they’re like, why would anybody pay to sign up for that when there are so many free YouTube videos with lots of tutorials? Paying for information is such a scam. Despite the fact that literally hundreds of hours are being uploaded to YouTube each and every minute, the online education industry isn’t shrinking, it’s growing rapidly. It’s projected that in 2023 that the online education industry of paid eBooks and paid courses will be a $130 billion industry. Ironically, we’ve now got so much free information that it’s too much information. Yes, there are so many free educational resources out there like YouTube videos, but what if the YouTube video isn’t well presented? What if the person rambles for 10 minutes before getting to the point? That is why more and more busy consumers are paying for curated information in the form of eBooks and video courses from content creators.
And now you might be thinking, geez, Sarah, that’s all well and good. You can sell a video course because you literally have hundreds of thousands of subscribers. But let me tell you now, if you take the time to build up a social media following, you can make serious money with just a fraction of the followers that I have. Earlier this year, I highlighted the friend of mine who has an Instagram following of less than 50,000 people who are all interested in the same niche. So what she did was she got a free ebook creator app and wrote an ebook for her niche. She then signed up for a free two week trial ClickFunnels account and used that to set up a simple three page website. Page one, a simple sales page for her $20 ebook. Page two, a checkout page. And page three, a thank you page that contained a link for the customer to go and download their ebook. She then purchased in $8.88 domain name on Namecheap and connected her ClickFunnels site.
She posted it on her Instagram and within five months, she had sold over $28,000. And when I highlighted this story earlier, a few weeks ago, she was making about 400 to $500 a week. But now, thanks to word of mouth, she is making up to an over $2,000 a week, which is insane. I’ve got a question. If you live outside of the USA like me, how much is 2,000 US dollars all as where you live? Here, it’s 3,000 New Zealand dollars. So I checked, and $3,000 a week, would easily put her on the top 5% of income earners here in New Zealand.
And while this is pretty incredible for an Instagram following of less than 50,000 followers, honestly, she could have made even more money because instead of selling a $20 ebook, she should’ve sold a $20 a month video course. So my course, it was created the old fashioned way. It was a custom built word pre-site like you used to have to do in the past. And do you know how much money this costs me to make? I’ll tell you. It cost tens of thousands of dollars, but times have changed since then, thanks to incredible apps like Teachable. Anyone who believes that they have knowledge and information to share to help others can create their own video courses with monthly recurring billing subscriptions for cheap. For just $39 a month for Teachable, you can use the same course templates and same sales page templates that Pat Flynn from Smart Passive Income uses to create his own six figure courses. And so if you are passionate about a particular topic or niche and you want to share that information with the world, there has never been a better time than now. You can take a course or go to the good old freeway and watch this organized YouTube videos to learn how to build up a social media following.
But either way, you don’t need hundreds of thousands of followers to launch and make a six figure business off of your own educational products. Instead, what you actually need is to take action. Thanks for watching my video. I hope I was able to teach you something new today. And if you did learn something new, then be sure to subscribe and click that little notification bell next to it so that you don’t miss out on any of my videos.