The speed at which online businesses are increasing every year can only be attributed to its numerous advantages. But despite these advantages, online business does not come without disadvantages too. 

While every online businessman or woman claims to be making millions, we see also many online companies closing down as soon as they sprouted. So why are millions of companies thriving and millions of companies also collapsing?

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In this article, we will bring you the many pros and cons that are associated with eCommerce otherwise known as an online business. So while you leverage on the many advantages, you would also be aware of the advantages that come with it, and therefore know how to obviate them.

Pros and Cons of Online Business

Below we will explain some of the advantages and disadvantages of starting a business online.


1. Minimal Capital

The low or minimal capital startup should be the biggest advantage of online business. This is because you don’t need to cover all the overhead costs that offline firms have to cover to aid their operation. From physical housing, warehouses, insurance schemes, too many staff, office properties etc that comes with offline firms. In online business, these costs are relatively low or absent.

When you’re running an online business, lower overhead costs give you the chance to be a low price leader in your niche. This reduced cost helps you to supply your customers at the very best price.

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2. Wider Reach

With an online business, the opportunity to almost reach every region is presented. Unlike offline or physical firms where only those around the region where the firm is located can access it. An order can be made here in Nigeria and a company based in America will deliver the goods or services without much hassle. 

Given today’s supply chains and shipping capabilities, even the smallest online firm can handle international sales. This expands the possible target market from only thousands to millions.

3. Not Limited by Time

In offline firms, there are usually stipulated hours one ought to work. One of the biggest advantages of running your own online business is that you’re not restricted to work within office hours, you can work around your schedule and spread the work throughout the day. Because there are no time restrictions, you can manage your schedule based on your business needs and goals. 

4. Better Customer Satisfaction

When a customer walks into a store looking for a specific product, the retailer either has the item in stock or doesn’t. If the product isn’t in stock, the customer has to settle for a different option or wait for the desired item to come in stock. Either way, the customer isn’t readily or fully satisfied.

With an online retailer, customers can customize their orders, choose the exact products they want, and have them shipped to them. They’ll have to wait a few days to receive it, but that expectation is built into the experience. The result is a more satisfied customer.

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The Cons of Starting an online business 

1. Low Credibility

For the fact that the cost of starting up an online business is relatively low compared to physical firms, they don’t necessarily enjoy the same level of trust. The truth is that many online businesses spend most of their time trying to prove they are genuine. This problem is majorly felt by the small and new companies. 

With a physical firm, a certain level of trust exists automatically between the customer and the business. The fact that a firm has taken the time and invested the money to set up a store and build out an infrastructure says volumes.

2. Proliferation of Services

In online business, there is a multiplicity of services. This is a disadvantage because there are too many firms jostling to provide a particular service. It breeds unhealthy competition and reduces customers.

Unlike offline businesses that may have one or two competitors in the area, online companies are pitted against dozens or hundreds of competitors across the world. This level of saturation can make it difficult to win any marketplace penetration.

3. Technical Issues

While it is cheaper to start up an online business, the various technical issues associated with websites and blogs can not be overlooked.  This is one of the major challenges to online business. A faulty site will affect the quality of services provided. 


There are so many offline firms making millions every day,  so also there are many online businesses making millions.  The choice you make completely depends on the resources at your disposal and how you can manage them.  Starting an online business Is not totally a bad idea. The current global digitalization has justified the rush for it. I hope this article can help you take a conscious step towards starting up your business. 

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