Shifting Your Business Online? All the Legal Documents and Steps You Need to Take

Shifting Your Business Online? All the Legal Documents and Steps You Need to Take

person working at laptop in coffee shop

For most businesses, including LLCs and small businesses, shifting to an online platform is looking more appealing after the last several months. Research shows that buyer behavior is evolving, with more shoppers exploring online ordering than ever before. According to Adobe’s Digital Economy Index, ecommerce sales rose 49 percent just in April, compared to a baseline period in early March.

Nearly every industry, from healthcare and groceries to beauty and fashion, are experiencing unprecedented online growth, and many are adapting to meet consumer needs in the digital space. If you’re preparing to take your business online, read on for a step-by-step guide to going digital.

Steps to Moving Your Business Online

Step 1: Get Your Digital Ducks in a Row

While user-friendly platforms are making it easier than ever for business owners to design and run their own online shops, it’s unwise to rush the process. It can be tempting to throw together a quick website to maintain sales, but a sloppy site can do more harm than good. Before starting an online store, it’s important to put in the prep time needed to make your shop a success.

  • Set Goals for Your Online Business. Are you hoping to make up for lost sales as consumers move away from traditional brick-and-mortar shopping? Or are you working to build your brand? Will you cater to your community with local pickup? Or do you hope to grow the business beyond the border of your home state? These decisions will be important in guiding you through website design, legal concerns and business policies. Write up a list of your primary goals for your online business, and make those your priority.
  • Research Your Audience. You might think market research is reserved for brands with big budgets and big reach, but it’s possible to conduct testing with your target audience scaled to your business’s size and finances. Gathering consumer insight will help you understand your target and shape your online offerings to match their behaviors. Learn some of the easiest and most effective ways small business owners can start gaining consumer insight right now.

Step 2: Open Your Online Store

woman starting website on laptop

It’s never been easier to launch an online business, but more options mean more choices, and that can feel overwhelming. But you don’t have to be a graphic designer to build an attractive website that converts leads into sales. Follow these steps to launch your online store and build your digital brand.

  • Choose the Right Ecommerce Platform. It can be helpful to use an all-in-one ecommerce tool like Wix, which guides you through the entire process, from choosing a template and setting up online sales, to securing a URL and marketing your business. Other platforms like Shopify and Squarespace offer similar features. Most have different payment tiers, so you can scale your build to align with your budget.
  • Consider Shipping Options. The right shipping strategy can have an enormous impact on the success of your online store. You may choose to offer free shipping, which reduces cart abandonment, or offer a flat rate or real-time carrier rate. Learn more about shipping and packaging guidelines, sourcing your materials and carriers and setting up business accounts with your providers.
  • Offer Shipping Alternatives. Adoption of curbside pickup has soared over the last few months, and if you’re serving a local clientele and have a physical location, it can be a great, cost-effective alternative to shipping. Local delivery is another popular option with online shoppers, but keep in mind this can be time-consuming and costly.
  • Provide Varied Payment Options. You might think that as long as your store accepts major credit cards, you’re in the clear. However, data shows that nearly 20% of shoppers will bail on their cart if they aren’t satisfied with the payment options. Today, many payment platforms protect both buyers and sellers, make payment convenient and cost very little. PayPal is one of the most trusted online payment services, but it does charge a small fee to business owners. Google Pay and Apple Pay are free to use and make it simple for users to check out with a single click. Square and Stripe are good baseline payment platforms that process major credit cards and allow you to add on other options. Bottom line: the more payment options you offer, the better.
  • Gift Cards Add Immediate Cash Flow. If your brick-and-mortar business sells gift cards, you already know it is a great way to increase cash flow. The same holds true for online stores. Most ecommerce platforms will offer you an option to create digital gift cards, send email confirmation and manage gift card redemption.

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Step 3: Cover Your Legal Bases

While online businesses are typically protected by your LLC or business filing status, there may be additional items necessary depending on the type of online business you’re planning to operate. Before you launch, it’s best to check with the Small Business Administration to find out what business licenses you’ll need for an online store in your state. Other considerations include:

  • Home Occupation Permit. This may be necessary in your geographic location if you plan to operate the entirety of your online business out of your home. To find out if you need a home occupation permit and how to obtain one, you can check with your city or municipality government.
  • Employer Identification Number. Your EIN, otherwise known as your Federal Tax ID, allows you to hire employees for your online business, open bank accounts and simplifies your business tax filing process. You can apply for an EIN with the IRS or Incfile can also obtain an EIN for you.
  • DBA License. This will apply to any online business operating under a name different from the original filing. For instance, if you filed an LLC for your brick-and-mortar flower shop under the name “Blooms & Bouquets,” but you want your online store to be called, “Blooms & Bouquets Direct,” you’ll need to file for a DBA, or “Doing Business As” license. You can file a DBA with your state government or let Incfile take care of it for you with our DBA service.
  • Sales Tax. The majority of U.S. states (45 out of 50) are subject to sales tax, and if your business has a physical presence (even an office or warehouse) in any of these states, you will be required to collect sales tax on applicable purchases. You’ll need to apply for a sales tax permit within your state, and it helps to know current tax rates, exemptions and special circumstances. Most of the time, your online sales platform will help you automatically calculate appropriate sales tax.
  • Privacy Policy. For your online business to comply with current data protection laws, you’ll need to create a privacy policy that can live on your website. This is especially important if your sales are open to EU customers protected by GDPR laws. Easily add a privacy policy to your online store with Incfile’s contract library.

Step 4: Market Your Move Online

smartphone with facebook

Once your online store is ready to launch, you’ll need to let your customers know how to find you. Create signage at your physical location that makes them aware of the move to an online space, and hand out cards or fliers. Other ways to let consumers know where in the (cyber) world you are include:

  • Social Media. Be sure to update each of your business's social platforms with your new website address, and post frequently about the move. Consider running ads to reach your targeted audience, and offer deals like free shipping or online-only sales to help them transition.
  • Email. Build your email list so you have a database of customers to connect with. If you’re closing a physical shop, ask customers to provide their contact information to stay updated on your future plans. And when you do launch your site, make sure it has plenty of data collection points, such as offering coupons or asking customers to register at purchase.
  • SEO. Search engine optimization is one of the most important parts of creating your store website. SEO ensures that potential customers can find you easily. Your website platform will likely offer you some tools to improve SEO and help you select keywords your customers are using. Additionally, Google My Business is a free tool that can improve your ranking and put you in control of what consumers see when they search for your business.

Shifting your business online isn’t a difficult process, but it can be a lengthy one, with many considerations. By following the steps outlined above, you’ll soon be on your way to success. As always, if you need guidance or support, the experts at Incfile are here to help.

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