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Thread: What is an online business?

  1. #1
    Moderator Kay is a Premium Member
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    What is an online business?

    Just something for you to chew over if you're interested.

    We all know about the difference between buying or creating an online business and other ways of making money online. Thus, earning by getting work online as a freelancer is a job - you earn money for doing some specified piece of work. I'd not consider it to be a business. Most ways to earn online are very easy to put in a box - business or not.

    I'm not so sure about some which don't seem to be so easily labelled. For example, is publishing your own ebooks on Amazon a business or a job? Sure, you have to do the work to start earning in the first place but after that, it is pretty much passive income (a very rare thing despite what some people would have you believe). I suppose you could have a publishing business. Working for yourself in your own business could also be a job. What then is a business? Something where you can be completely hands-off? Commercial activity carried out with the objective of making a profit? But that could be a job too.

    Maybe such things are on a continuum and not either one thing or another. What do you think?

    I guess some of you will think, "Who cares?" I think it could be important sometimes, especially in cases where people think they're buying a business when in fact they're buying themselves a job.
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  2. #2
    aka "bryanon"
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    http://en.wikipedia.org/wiki/Business:

    A business, also known as an enterprise or a firm, is an organization involved in the trade of goods, services, or both to consumers.
    .. and what makes a business an on-line business is that it either does not have a physical location, or that physical location is not crucial in terms of customer acquisition.

    As for the whole "job" vs. "passive" thing - you need to understand that the fact that you're the only employee of your business doesn't make it less of a business. Sure, there are situations where it would be un-economical to hire someone else do the job, but that business is still a business - just a very poorly planned one.

    The confusion probably comes from many owner-operators failing to declare their own time spent on their business as an expense, and that's understandable. But that's simply misrepresentation and nothing else. It doesn't change the definitions of "business", "online business" or "job".

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    Moderator Kay is a Premium Member
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    LOL! I just posted the question to see what people's opinions are and how they view "online business". I did, of course, know various business book definitions and other "official" definitions. I also would have been able to consult Wiki without help had it been required. But thank you anyway.

    As for the whole "job" vs. "passive" thing - you need to understand that the fact that you're the only employee of your business doesn't make it less of a business.
    Would you therefore consider the "passive thing" to be an important criterion as to whether someone has a business or a job? I only mentioned it as an example of how earning a passive income may not necessarily mean it's a business.

    It would never have occurred to me to suggest that a business with only one employee was less of a business. I think most people already understand that. It's very common both online and off for people to be employees (including the only employee) in their own business. Sole traders/proprietors are a prime example. For some of them working in the business is very much like having a full-time job, albeit a job in their own company/business. Where does one draw the line? Offline it's usually risk and reward which suggest whether something is a business rather than job. Are the lines not a bit skewed sometimes when it comes to online business? With low barriers to entry and very little risk, if any, for some ventures at what stage does it become a business rather than, say, a hobby or a learning experience?

    The confusion probably comes from many owner-operators failing to declare their own time spent on their business as an expense, and that's understandable. But that's simply misrepresentation and nothing else. It doesn't change the definitions of "business", "online business" or "job".
    Sure, there are lots of unscrupulous sellers selling what they purport to be businesses, when in fact they're not. And some people don't have the experience to spot the difference. That's why I thought it would be useful to discuss the issue.

    It doesn't change the definitions of "business", "online business" or "job".
    I agree that unscrupulous sellers (or those who otherwise misrepresent what they're selling - eg accidental inaccuracy) don't change definitions. However, sometimes definitions change over time because of a changing environment. With new technology, new opportunities to make money and whole new markets opening up all the time, it may not hurt to rethink and explore the traditional Business101 definitions sometimes. Therefore, I'm still interested to know what people think defines an online business.
    British Expat - helping people to live and work abroad since the year 2000.

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    Top Contributor Dave McM is a Premium Member
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    Interesting question. I love semantic debates.

    Quote Originally Posted by Kay View Post
    Thus, earning by getting work online as a freelancer is a job - you earn money for doing some specified piece of work. I'd not consider it to be a business.
    I'd say that was a grey area. What about consultants, for example? I'd consider a person offering a consultancy service to be in business rather than doing a job, but I'd still think of them as being a freelancer.

    To me, whether an individual is doing a job or running their own business is bound up with their ability to make independent business decisions.

    Do they advertise their own services, negotiate their own contracts with customers/clients, decide what work they're going to focus on in the long term? Then they're running their own business.

    Or do they apply for contract work advertised by others, perhaps through an agency, and do pretty much whatever work they can find? Then that's more like a job, but without the security that an employer might offer.

    As you suggest, though, it's a continuum rather than a binary switch. What one person might define as a job could easily be considered a business by someone else.

    Quote Originally Posted by Bryan View Post
    what makes a business an on-line business is that it either does not have a physical location, or that physical location is not crucial in terms of customer acquisition
    Often true, I'm sure, but not necessarily. I'm sure there must still be some die-hards around who advertise mail order services through the print media.

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    New Member Mentor JimWaller is a Premium Member
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    This reminds me of the whole "What is art?" question many artists debate. It does depend on your definition. You can indeed have both a job and a business at the same time. As an artist, I can sell my paintings as a business, but my job would be producing those paintings. An interesting aspect of that is that without paintings there is no business, but without the business of selling paintings there can still be paintings. The business is dependent on the job, but the job is not dependent on the business. Is that always true? I'm not sure. But it does raise an interesting point in the definition of what a business is. Arguably, I could sell other people's paintings, which would be a business without me having the job of producing them. (The business would still be dependent on someone producing the paintings.)

    So, a business depends on work of some sort being done, but work in and of itself is not necessarily a business. What do you think?
    Help bring Janice home My mother-in-law was hospitalized while on vacation (holiday) We're trying to bring her home.

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