Q: What is a virtual business and what are the benefits and drawbacks?
Mar 11 2008
Answered by: Chris Lindsay Ask a question
A virtual business can mean many things to many people, but used to be a business that had no physical identity, for example, an internet-based company such as Amazon.
Things have changed over the last few years, however, and so has the definition. A virtual business generally still doesn’t have a physical identity, but rather than being based on the internet, uses the internet and the tools it enables to do business.
Many of these businesses don’t have offices and are home-based, taking advantage of services like Voice over IP (VoIP), hosted email and collaboration tools, remote support and Web-based social networking services, such as BT Tradespace, to keep in touch with customers and partners, as well as win business.
Using these tools can dramatically reduce the running costs of a business, because internet-services tend to be hosted or delivered as Software-as-a-Service (SaaS) for a monthly fee or sometimes free. It also means that there are no setup or ongoing maintenance or upgrade costs. This coupled with no real estate costs means being virtual can have real benefits.
One thing to consider, however, is whether your business lends itself to being virtual, for example, do customers regularly need to visit your premises.
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