The Hidden Costs of Starting an Online Business

Many first-time business owners believe choosing a wholly online business model will result in cheaper start-up (and monthly) costs than if they were to open a true brick and mortar store. This assumption is built on the idea that their costs will end when their website is up and running. This is, unfortunately, entirely untrue. There are a variety of extra costs involved in not only ensuring your business becomes(and continues to be) successful, but that it continues to be operational at all.

Initial Costs

For online businesses, even some of the initial start-up costs are a mystery to first-time entrepreneurs. The up-front and subsequent yearly subscription costs of buying (and keeping) a domain name and business email, as well as the cost of getting a website professionally designed are obvious. However, if you’re an ecommerce business, you’ll need a subscription to a payment supplier like Stripe, PayPal, or Square, as well as a cart and checkout feature, like Shopify offers, so customers can make purchases.

If you aren’t an ecommerce business, but otherwise handle the sensitive personal or login information of customers, you’ll still need to pay a yearly fee for an SSL certificate to secure your website and the data it holds. The amount of traffic your website receives can also wildly fluctuate the fees associated with building and maintaining your website.

Search Engine Optimization (SEO)

One of the major hidden costs of starting an online business is SEO, or Search Engine Optimization. It’s the importance Google (or Bing) gives your website in their search engines, which governs your placement in a user’s search results. If your SEO is poor, your website will be outranked by competing businesses, which means you’ll lose out on website traffic and potential sales. The solution involves hiring an SEO specialist for an extra expense, to both properly set up your website’s SEO, as well as periodically continue to maintain your ranking. Having a mobile-friendly version of your website also positively affects your SEO ranking, which is an extra cost that can be bundled in with your initial website setup. It can also be a good idea (and further cost) to pay for an analytical program which can track visitors and business conversions, so you can see if your SEO is working.

Content Creation

Yet another way to increase your SEO ranking is to regularly create extra content for your website (such as writing blogs), as Google rewards websites with high quality written content. Unless you have a lot of extra time on your hands and are well versed in content creation, it’s generally a good idea to hire someone to focus on writing either full time, part time, or on a freelance basis; yet another cost to your ever-expanding collection of fees.

To increase your business organically, it’s also important to market your company through social media outlets like Twitter, Facebook, Youtube, LinkedIn, and Instagram (among others). Although you may use social media in your personal life, that doesn’t mean you understand how to get the best results for your business, nor thatyou have the time to dedicate so much of your day to curating content, answering questions, keeping on top of comments, and monitoring reviews. If a business wants to be successful, the solution is to hire a dedicated social media manager who can fulfil all of those needs. One more expense to add to the list.

Promotions and Ads

Once you’ve hired a social media manager to organically improve your online presence, you may want to take advantage of the promotional ad feature these same social media companies offer. Each company has a different price point, and many different paid options, but the most common is a Pay Per Click (PPC) model, in which you can set a certain budget which can range anywhere from $10 a day to $5,000 a day and beyond. Twitter, Facebook, et al will boost one of your posts to a set number of viewers so they’ll appear on their feeds or timelines. This increases the number of people who see your business and will (hopefully) increase your sales. The same can be done on Google, where you can set up an ad for your business using the same PPC model. As long as you still have money funneling into the system, your business will be placed at the top of your applicable Google search result page.

Your business can also spend extra money by going the traditional promotional route, opting instead (or in addition to online advertisement) to pay for banners to be displayed around town, or for your ads to be played over radio or on television. This expense can often be far more expensive than the online options, but still remain a viable avenue to improve the success of your business.

Physical Office Space

For some entrepreneurs, an online business can fulfill a dream of working from home. (Albeit one that still carries an extra cost for good internet speed and bandwidth). However, for most entrepreneurs, they require a physical office space to either work collaboratively with a handful of employees, or a physical warehouse to store and ship products from. If you can’t get away with working solely from home, you’ll have to factor in the costs associated with office and/or building rental, utilities, internet, and equipment like furniture and computers.


As we’ve touched on throughout, if you’re a business owner who needs the help of other employees to ensure your company is as successful and as profitable as it can be, that often means hiring extra people to complete the tasks you don’t have the expertise or time for. The cost of adding people to your team can range wildly depending on the salary expectations of where you live, the benefits that are expected to be provided by an employer, whether you hire in a part-time, full-time, or freelance capacity, and many other categories.

Your business may be online, but there’s an extensive list of ways that the cost of maintaining a successful company doesn’t stop once your website is live. If you’re an entrepreneur, you need to factor in the total cost of ownership. These can include initial website costs and subscription-based fees for website add-ons, payment to employees or other experts, advertising, and the cost of renting a physical office space. The list of extra costs can easily extend beyond the examples provided, however, reaching into issues like currency conversion for those unlucky enough to do their business in anything other than USD. However, the important step to ensure success in the long run is realizing the work (and costs) are never truly over.

Need help navigating the extra costs associated with an online business? Calibre Consulting can help with some of the most important sides of the equation: website building, website maintenance, and SEO!