Lesson 3: Which Business Model is Right for You?

The five most common business models for making money online are as follows:

  1. Drop shipping
  2. Selling a digital product (ebook or online course)
  3. Selling a physical product (you manufacture and ship yourself)
  4. Selling a service (wedding photography etc)
  5. Advertising model

My PERSONAL favorites, are options 1 and 2. I’ll explain why shortly. I use them both, and we’ll focus on those here in today’s email because they are the best to start with.

Online business model #1: Drop shipping

In a nutshell, you set up your website, post pics and info of your products.
Your customer pays you, you then take that money, and send it to your dropshipper.
The drop shipper then ships the product straight to the customer for you.

This is one of my favorite models for many reasons:

  • No inventory on hand!
  • You can start with almost no money out of pocket. You use the customer’s money to make your orders. This is how I started my main online store with no out of pocket cost.
  • I make thousands of dollars each month like this, literally, just by sending emails, and transferring money to my dropshipper using Paypal.
  • Over the years we’ve done over 100k profit with this model.

There are some cons to this method to consider as well:

  • The dropshipper messes up sometimes, or is super slow to deliver. The customer thinks it’s me. I get the blame, and have to take it.
  • It’s a physical product, you will have angry customers from time to time, this creates refunds and headaches.
  • Again, it’s a physical product, so it can break, or not fit, or the customer uses it wrong so they think it’s a faulty product…ya I’ve experienced all of those, multiple times…

I use this dropshipping method with one of my online businesses: Click here for an example.

Where do you find products to dropship?

I personally use Alibaba.com to source products. They literally have every single product of any thing you can think of. It’s crazy.

AliExpress is their sister company. They often let you purchase in smaller quantities, so check them out too.

I look for things that you will profit at least double, what you pay for it, and also at a medium to high price point.
That way, you’re not doing a ton of transactions for just a little bit of profit.

Example: If you can buy a laptop bag for $20, you want to make sure you can sell it for at least $40 and it still be a good deal for everyone involved.

But that’s definitely on the low end, I’d like to go much higher than that.

You don’t want to be an online walmart, you want to be an online high-end boutique.

You’ll have less transactions, but you’ll have more money. (And less headaches!)

Online business model #2: Selling a digital product.

Now this one is my ABSOLUTE favorite.

By creating an ebook, audio download, or online course, you are able to sell your product online with maximum profits and maximum potential.

You will put A LOT of work in up front, but once the product is complete, you can sell them forever, and with no overhead.

Think about it, you can truly sell an unlimited amount of copies for your ebook or online course. There’s no physical product, there’s no warehouse, there’s no products breaking down and people asking for returns…

You can create a truly passive income model using these methods.

There are tons of people making 40k, 50k, even 100k a month, selling online courses and guides.

I think you can see why this is my favorite.

I use this model personally on these two businesses here, and here.

Online business model #3: Selling a physical product.

This would simply be putting up a website but selling something that you create or have access to.

Perhaps you sew custom clothing, make hand carved figurines, you make wall hangings, or custom bean bag toss games…etc.

This is a GREAT way to get started in online business too. Most everyone has something they are good at and would like to sell online.

This may possibly be the option you want to start with.

Online business model #4: Selling a service.

This would be selling your lawn service, construction business, or perhaps you coordinate weddings.

Your website becomes an “online business card” or brochure, so that potential customers can browse your services, prices, and portfolio of previous work.

Customers will look for reviews, your location, and they may even reach out to you by email if they have more questions.

You will DEFINITELY need a website if you have a service to offer, this is vital. It’s just how people shop these days.

Online business model #5: Advertising model.

This is seen quite often in online magazines, or what we call “mommy blogs.”

The concept here is to have LOTS of articles and essays on your site, so that you can drum up as many readers as possible. Then you monetize the site using online advertising through a company such as Google Adsense.

Often, the more readers you have, the more money you can make.

These can be a lot of work to maintain and continue to write for. Especially if you’re not truly passionate about the topic. But the passive income from the ads can be very nice.


So that’s a brief rundown of 5 different online business models. They each have their pros and cons, but one, or maybe two of them will work best for you. We’ll get into more detail on exactly how to implement these models, build your website, set up a payment system, and start getting sales in my upcoming course, “The Fast Track to $500 per Month”

I’ve got some exciting details coming up on that, so look for me in your inbox. (You haven’t seen anything yet!)