Working from home has become such a huge trend that there are now almost four million Americans doing it. And while there are many types of businesses you can build on your own, e-commerce is arguably the best.

Many existing businesses can be converted to an e-commerce model, at least partially if not entirely. But why is e-commerce the best type of business to start? Let's get a look.

What is e-commerce?

First of all, it is useful to know exactly what e-commerce is. The term itself is a shortened version of “electronic commerce.” This essentially means buying and selling goods or services online. In other words, if you exchange currency online, you are involved in electronic trading.

Types of products involved in e-commerce

Although goods and services can be quite broad categories, this can be expanded even further. Every e-commerce business falls into one of the following categories: physical products, affiliate sales, digital products and services.

Physical products are, of course, anything you sell to customers. These could be new items, items in stock, or even used items. Selling these items typically requires sourcing, selling, and shipping physical items. However, many people who do this have their items shipped directly so they never touch the products.

Affiliate selling, or affiliate marketing as it is commonly known, involves creating and selling products using a commission-based structure. The creator allows affiliate marketers to advertise their product, usually on their website, and earn a commission every time someone uses their link to complete a transaction.

Digital Products are simply products made to be downloaded digitally. This can include e-books, print, audio, video, courses, software, and anything else that can be viewed digitally, listened to, or downloaded online.

Services include everything that does not fit into the previous categories. Some service businesses are entirely online, while others operate partially in other ways. For example, an advisor may use a website and online payment method to complete transactions. But then they can schedule phone calls for actual consultations.

This example would certainly be an e-commerce business, but there is an additional element of telephony. Other examples of service industries are marketing, writing, design, etc.

What makes e-commerce so great?

As you have already realized, one of the things that makes E-commerce such a great business model is the fact that you can start with very little overhead. you don't need employees, a building, or any of the other physical things that typically go with making bricks and mortar.

This doesn't mean that some e-commerce companies don't reach a point where they need additional help or storage facilities. But most can be launched fairly inexpensively. You can even outsource many of your own business tasks, such as making e-commerce accounting fully accountable.

Additionally, in an e-commerce business, you can usually work from home. This will help you save on things like travel, wardrobe and food costs. But it can also be useful for people who prefer to work alone or have limitations that make working from home a necessity.

But perhaps most importantly, the income potential from e-commerce is virtually unlimited. Your audience may be much larger than that of a physical location. And if you sell a product that can be downloaded over and over again, you earn passive income. You're no longer trading dollars for hours at a time, so there's no limit to what you can do.