Regardless of what you decide to sell, there are basically four ways to start an online business.

1. Starting an Online Business from Scratch: If you have a product you’ve developed yourself, a service to offer or information to sell, this is a viable option. It has the most rewards and the greatest amount of risk. You call the shots, determine how you’ll market and price your wares and be responsible for its ultimate success.

2. Start an Online Business through Affiliate Programs: If you don’t have your own product, service of information to sell, Affiliate Programs allow you to make money by referring customers to a company’s website. Amazon.com is a good example of this. They pay a small percentage of each sale to their affiliates who send them there to purchase goods. Commissions are usually paid after a certain period of time, such as within three months after the goods are sold. An Affiliate arrangement carries little to no risk to you, but the income won’t be as great as running your own business.

3. Start an Online Business with Direct Sales: You’re probably familiar with these. Tupperware, Mary Kay and hundreds of sellers of kitchenware, home décor, craft products and dietary supplements are examples of Direct Sales opportunities. In this arrangement, you typically work under the direction of an experienced manager and receive a commission on the goods sold. The arrangement is attractive because it costs less to start the business and the Direct Sales company handles things like warehousing product, creating new goods and developing marketing materials.

4. Resell Products You Buy Wholesale: This is the standard retail model of brick and mortar stores and ideal if you don’t want to develop your own products. There are hundreds of wholesale shows throughout the country where you can purchase goods to sell and then handle all the warehousing and shipping from your own home. Many companies will also allow you to drop ship products. This means they warehouse the products and ship them directly to your customers after they are sold. You just handle sales and customer service.

If you spend anytime on an online marketplace such as ebay.com, you will start to notice that many people are selling the same goods, albeit at very different prices. Most of these businesses are using one or both of the last two strategies mentioned above to generate revenue.

Let’s take a look at each option a little more closely.