The past year encouraged all of us to embrace the great indoors. No surprise, then, that the interest in making money online from the safety of our homes is now on the rise.
What once felt like a distant daydream is now a reality for millions of people. Those of us who worked remotely from our home offices for the last few years have a lot less explaining to do at family events—the path to earning a meaningful amount of money online has become much clearer.
The magic of the internet is that it’s a sales channel, marketing network, and community hub all in one—plus so much more. There are many creative ways to make money online beyond online surveys and selling used goods on Craigslist.
That said, some businesses and side hustles are better suited to the laptop lifestyle than others. In this guide, we’ll break down the strengths and shortcomings of a few of the top money-making options.
5.best ways to make money online
To make choosing the best ways to make money online easier, we’ll look at several key factors:
Business type: whether the idea is product based, service based or driven by an audience.
Effort: how much time, skill, or experience you’ll need to put into the idea.
Leverage: how well positioned you are to turn the idea into a money-making one that increases in value without needing your direct attention. A high-leverage idea isn’t a 1:1 trade of time for money.
Startup costs: the upfront budget you’ll likely need to launch the idea.
1. Dropshipping
Business type: Product based
Effort: Medium
Leverage: High
Startup costs (out of 5 💸): 💸
Last year, many worldwide trends experienced a decades’ worth of acceleration. One such trend was the rise of ecommerce. There are a number of ways to run an ecommerce business, some of which allow for minimal need to carry and hold lots of inventory.
Enter dropshipping. Dropshipping is a business model where you don’t keep the products you sell in stock. Instead, when a customer buys something from your store, a third party fulfills and ships the order for you. Because low startup costs are low, it’s an increasingly popular way to make money online for beginners and pros alike.
Dropshippers have a habit of chasing the latest trends. And while there’s nothing wrong with catching a trending product wave, know that there also are many product categories that are steady and offer similar opportunities to do well. At Shopify, we regularly see these categories in our list top performers:
Women’s clothing and accessories. Far and away the most popular category of products on Oberlo. There are a variety of interesting niches within this category, too, including dresses, accessories, intimates, hoodies, socks and hoseries, and rompers. Since these products have a large market, are purchased relatively frequently, and are successfully sold through great marketing, they’re consistently a top performer for dropshipping.
Jewelry. If you want to turn jewelry into a profitable small business, dropshipping is a good model to try. You can sell in a variety of categories, including fine jewelry, fashion or costume, and collectibles. Or sell jewelry made from different materials, like gems, wood, textile, or metals.
Home and garden. Home and garden is one of those dropshipping niches that seem to always be trendy. People are always looking to add personal touches to their space to make it feel warm and cozy, which can make this an exciting (and profitable) niche to sell in.
Beauty. The beauty and personal care market is projected to be worth $511.4 billion by the end of 2021. Beauty is a thriving industry fueled by younger generations entering the market and is strengthened by social media and ecommerce. You also have options in the beauty niche: you can sell cosmetics, skin care, personal care, hair care, fragrances, and more.
2. Print on demand
Business type: Product based
Effort: Medium
Leverage: Medium
Startup costs (out of 5 💸): 💸
Print on demand allows sellers to customize white label products with their own designs and sell them only after a customer buys, eliminating the need to hold inventory (which is what makes it a subset of dropshipping). When a customer places an order, a print-on-demand company will add your design to the product, fulfill the order, and ship it to the customer.
The most significant advantage print on demand offers over dropshipping is that you have control over the aesthetic of your products—a key differentiator for product categories where the design is the distinguisher, like t-shirts or fan merch.
When it comes to making money online, you can also use print-on-demand services to:
Test online business ideas or new products lines without the risk of buying inventory
Monetize an audience you’ve already built, whether it’s on YouTube, social media, or a personal blog
Offer diverse products by selling t-shirts, books, shoes, bags, mugs, phone cases, laptop skins, wall art, and more
Sell photos online by placing your images on physical products to sell to your fans
Overall, print on demand lets you create customized products quickly. You don’t have to worry about shipping or fulfillment—it’s taken care of by your suppliers. And since you have no inventory to worry about, it’s a low risk, low investment way to make money online. Passionfruit sells inclusive clothing and accessories for the LGBTQQIA community. The brand is built around the power of togetherness and building a bright future for queer youth, creating products that allows them to show their pride all year around, rather than only at special events.
Passionfruit’s products are all carefully designed with pencil and paper, then digitized, placed on products through a print-on-demand company, and sold in its store. You can find t-shirts, tank tops, sweaters, hats, stickers, tote bags, and more, all specially designed and curated for Passionfruit’s audience, with a mission to make a positive impact on the world.
3. Custom products
Business type: Product based
Effort: High
Leverage: Medium
Startup costs (out of 5 💸): 💸💸💸
While the options above come bundled with the convenience of not holding on to expensive inventory, they do come with some limitations—mainly that you don’t have full control over the product you’re selling.
And when you think of most direct-to-consumer brands, this is what comes to mind: original products that make meaningful improvements or add interesting details to well-known items. Personally, I’ve purchased many messenger bags, but I’d never seen anything like the one made by Vermilyea Pelle until it reached my doorstep.
Making products by hand is popular amongst jewelry brands, fashion brands, and home decor brands. It gives you full control over the product development and quality of your items. The only drawbacks are: (1) it can be time consuming, and (2) it’s difficult to scale. The costs associated with making products by hand are the cost of materials, storing your finished products, and labor.
That said, a custom product doesn’t have to be completely handmade. There are many ways to find a manufacturer or supplier to help bring your product to life. For example, you could:
Use domestic or overseas manufacturers. If you have a unique product that you don’t want to make by hand, you could find a manufacturer to make your products. The Alibaba route is a common way to do this. You can use the marketplace to find potential manufacturers, communicate your vision to them, and get your products made. This will require some upfront investment because of minimum order quantities and storage, but it’s a good way to maintain control of your products while keeping cost per unit low.
Resell wholesale items. Buying and reselling wholesale items is a straightforward, low-risk way to make money online. You buy products you want direct from manufacturers, usually brands that are already credible on the market, at a discounted rate, then sell them in your online store at a higher price.
It’s important to understand these methods to make the right choices when creating and selling custom products. Each has its own advantages and drawbacks, which you can read about in Make, Manufacture, Wholesale or Dropship: The Pros and Cons of Each Model.
4. Sell on Etsy
Business type: Product based
Effort: High
Leverage: Medium
Startup costs (out of 5 💸): 💸💸💸
Every online marketplace, from Etsy to Amazon, offers a shared set of advantages and disadvantages. The upside is that you get access to their network of shoppers—people regularly browse these sites when they need to buy something, so setting up shop lets you meet them there.
That said, since these channels can work in harmony with your own website, sometimes they’re a great place to begin. New online makers can use Etsy to grow brand awareness at first. They have an active buyer community of 45.7 million buyers. We’ve seen many businesses successfully switch to Shopify after generating their first few sales on Etsy, for example.
The benefits of creating your own Shopify store include:
You can manage the look and feel of your store. Your Etsy shop sticks to one design model with less room for creativity.
You can grow your product line. Etsy sellers are limited to selling handmade, vintage, or artisan products. Say you want to offer a complementary manufactured product that could create a better customer experience and boost average order value. You may not be able to on Etsy. Having a Shopify store helps serve your customers better and add new products, no matter if they are dropshipped, manufactured, or wholesale.
Easier inventory management. Ecommerce platforms like Shopify provider full inventory management and analytics so you can keep your records in order and make smarter decisions for your business.
If you have an Etsy shop and don’t want to leave just yet, you can always run both stores simultaneously. Once you set up your Shopify store, use a free Shopify app like Etsy Integration: Sync and Sell. You can easily sync inventories, manage orders, and make money online using both Shopify and Etsy.
5. Sell on Amazon
Business type: Product based
Effort: Medium
Leverage: Medium
Startup costs (out of 5 💸): 💸💸
Amazon has become a marketplace that welcomes new ecommerce entrepreneurs. It takes a few minutes to sign up for an account and a few more minutes to get a product listing live.
The platform has a massive audience, it’s a global marketplace, and it’s a go-to destination for product discovery and research. Listing optimization can help your products get found and unlock new opportunities. And Amazon’s in-app promotions can increase your brand's visibility for highly targeted audiences.
Yet, some ecommerce entrepreneurs question the long-term sustainability of selling on Amazon. While the marketplace is great for helping shoppers surface desired products, it’s challenging for sellers to get their business noticed. Amazon attracts many resellers of the same products you may offer. Tack on fees and trying to differentiate your brand and you may end up working harder to generate sales but not grow your bottom line revenue.
While selling on Amazon is a good way to make money from home, there are some caveats to consider:
Amazon sets the rules for its marketplace. We know Amazon is a leader in collecting and using customer data to create better shopping experiences, but that information doesn’t get shared with you. If you compete head to head with a product owned by Amazon, it’ll be hard to make sales. Amazon Retail tends to get the Buy Box advantage.
Amazon prefers sellers to use Fulfillment by Amazon (FBA). FBA is Amazon’s fulfillment program offered to sellers. Once you put a product in its fulfillment centers and a customer orders it, Amazon will fulfill the order. You must use FBA to be eligible for Amazon Prime and Amazon Super Saver Shipping, two ways to help retailers improve conversion rates and earn extra money.
Amazon owns the customer relationship. Sellers cannot add Amazon customers to a CRM or re-market to them after the sale.
That said, Amazon is a great additional sales channel for your Shopify business. Similar to Etsy, you can use Amazon to get your products in front of a built-in audience, get discovered, and use your ecommerce website as the main sales channel. You can even integrate Shopify with Amazon to manage listings and sync inventory faster and easier.
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