Welcome to informationhood, on this article you’re going to learn how to start an online store (e-commerce business) successfully. Everything you need to know to start and be successful is in this post. Kindly read everything here.
Like starting any other business, learning how to start an eCommerce business wasn’t always easy — but creating, launching, and managing a website that allows entrepreneurs, designers, and creatives of all kinds to sell their wares is now easier than ever.
E-commerce businesses — those that transfer goods, services, and funds over the Internet — range in size and scope from retail giants like Amazon to the craft site Etsy. Online shopping is just one of the many areas that have seen rapid growth over the past five years. According to a report by the US Census Bureau, US e-commerce sales were approximately $154.5 billion in the third quarter of 2019 alone, accounting for 11.2% of all retail sales in the country.
Depending on your goals, it makes sense to start an eCommerce business. Finally, eCommerce stores without the need for a physical location offer more flexibility, accessibility, and opportunity for many entrepreneurs. So how exactly does one start an online business? This guide aims to help you with that.
We’ll guide you on how to start an eCommerce business in seven easy steps – so you’ll have all the necessary information to get your online business up and running in no time.
How to start an e-commerce business in USA
There are significant differences between starting an e-commerce business and starting a regular business, but there are also many similarities. As we will explain below, many of the planning and legal steps you need to take are very similar to the process for any other business. But when the time comes to start your business, you will see how different it is to start an e-commerce business.
Step 1: Explore the eCommerces space and find your niche
The first step in learning how to start an e-commerce business is to do the necessary research. Just like opening a restaurant and looking for different places, food options, and themes, you need to research the e-commerce space that interests you and make some decisions related to your particular business. For example, you should carefully consider what to offer in your online store. Are you selling goods or services?
Step 2: Choose your company name and legal form
Once you have finalized the plans for your e-commerce store, the next step is to choose a name. As with any business, you should choose a name that is unique but also clearly represents your business or what it does. You may have to check the websites of your local Secretary of State and the US Patent and Trademark Office to make sure you are not choosing a company name that has already been claimed by another company.
Even if you don’t want to invest too much time in a website yet, it’s worth checking to see if your potential domain name is available for your business. If your domain name is currently in use, you should consider a different corporate name or structure, e.g. B. “yourcompanyname.co”, not “yourcompanyname.com”.
Next, select the legal form of your company. The type of business entity you choose has important legal and financial implications for your e-commerce business. Generally, you’ll choose to form a sole proprietorship, general partnership, LLC, or corporation. Each of these types of legal entities has advantages and disadvantages, so you may decide to consult an attorney or other legal expert for advice on the best option for your business.
If you decide to form a sole proprietorship or general partnership, you don’t need to register in the country where you operate. Instead, your company will be legally incorporated under your name, which means that if you wish to operate under your chosen name, you must apply for a DBA or “doing business as” with your local government.
Step 3: Apply for EIN
Next, you will want to apply for an EIN or Employer Identification Number for your eCommerce business. While not all types of business entities are required to have an EIN, this nine-digit number can be useful in helping you separate your personal and business finances. You can also apply for the IRS-EIN online, by mail, fax, or telephone free of charge. Since you are learning how to start an e-commerce business, you will most likely want to file this business tax number online and once you do, you will receive your number in no time.
Step 4: Obtain business permits and licenses
Now that you’ve applied for your EIN, you’ll want to obtain any necessary business licenses or permits to operate legally in your city and state. As noted above, if you’re starting your e-commerce business as a sole proprietorship or general partnership, you don’t need to register your business with the state — unless you apply for a DBA to legally operate under a specific company name. However, for other types of business, you must register your business in your state and obtain a general license to operate. Depending on your business location, you may also need to purchase a local operating license.
Since most e-commerce businesses operate from home, they generally do not require as many permits and business permits as physical stores. However, you should determine what specific requirements exist in your area – usually, you can find this information online at your state or local government website. For example, most locations require home business owners to obtain a home business license to operate legally. This type of permit simply indicates that by operating your business from your home, you are not adding traffic, noise, or distraction to your location.
Some of the types of business licenses and other permits you may need to include:
Professional and commercial licenses for specific industries.
- VAT approval.
- Health, safety, and environmental approvals.
- number plate.
- Building and building permits.
Step 5: Choose an eCommerce platform and create your website
At this point, you have completed the necessary paperwork to legally register and launch your eCommerce business. Therefore, most of our steps so far reflect the process of starting a physical business. However, instead of scouting for a location and getting ready to set up your physical store, start building your website and online store now.
Like a physical storefront, this website is the face of your business – it’s what your customers see first and what they use to browse and buy your products or services. With this in mind, building your website will be one of the most important parts of starting your eCommerce business. When developing your online store, you should consider several different points:
First, as mentioned above, you have to think about your domain name. You want your domain name to match (at least exactly) your company name. With that in mind, perhaps your most important decision will be choosing an eCommerce platform. Whether it’s an all-in-one software like Shopify or an open-source platform like Magento, your eCommerce platform is the foundation on which you build and grow your online store.
In addition to creating and launching your online store, most eCommerce platforms allow you to customize your design, add a domain (or buy one), manage inventory, receive and ship orders, accept payments, and much more.
While there are hundreds of these platforms on the market, you may consider one of these popular solutions to start your e-commerce business:
Perhaps the most well-known and popular eCommerce software, Shopify offers a complete and easy-to-use solution with a variety of add-ons. You can purchase a Shopify subscription with one of four plans, starting with Shopify Starter for $5 per month (this plan does not include the full online store).
If you already run a WordPress site or are familiar with the platform, you can download WooCommerce to start selling on your WordPress site. This plugin is open source, free to download, and includes all eCommerce features. However, compared to Shopify, WooCommerce is best suited for business owners who have the technical know-how to take advantage of its open-source nature.
Though primarily a website builder, Squarespace also offers eCommerce capabilities and is known for its modern templates. You can choose from two of Squarespace’s dedicated e-commerce plans — Basic for $26 per month or Advanced for $40 per month.
Like Shopify, Squarespace is easy to use and can accommodate business owners of all levels of technical expertise. However, because Squarespace builds the website first, it may not offer as many features, tools, or plugins as some of the other alternatives.
Magento (Adobe Commerce)
Lastly, if you want to customize every aspect of your online store, you can opt for the open-source Magento version now known as Adobe Commerce. This eCommerce platform lets you manipulate every element and customize your site — but you also need to have (or pay for) technical skills.
While it’s safe to say that this platform is generally not for e-commerce startups, if you have the technical skills or the budget to work with a developer, you’ll find that Magento is probably the best of all the open-source solution offerings on the market – and it’s free to download.
As you can see, this step involves a lot and there are several important considerations to keep in mind when choosing the right platform for your e-commerce business. You have to think about cost, features, ease of use, etc. After all, as the foundation of your e-commerce business, you need a working system that can be up and running within a day of deciding which solution to use. suits you.
The next thing you need to do is set up your website and get it up and running. You have to think about how you want to design your online store, what design you want, what colors you want to use, and so on. Depending on your platform and budget, you may decide to create and launch your website or invest in the help of a professional designer or developer.
STEP 6: FIND OR DEVELOP YOUR PRODUCT (AND REGISTER)
Once you’ve chosen an eCommerce platform and launched your website, the process is almost complete. At this point, you need to find the product you want to sell. During your research in
Step one, you should have thought about how you would approach this process. You can create your own or choose from a distributor. B. As a consultant, you only need to describe and list these services on the company’s website.
As you can imagine, if you’re selling a product, this step gets more complicated because you need to consider the inventory you want to start with and the start-up costs. You should also take the time to list your inventory on your online store. Think about your customer experience, search engine optimization (SEO), and how your customers have moved forward since purchasing a product when they receive the product.
Step 7: Promote your e-commerce business
That’s it, you have learned how to start an e-commerce business. Now that your product or service is set up and listed on your online store, your website is ready and you can start serving your customers. Of course, in order to do this, you need to properly promote your eCommerce business.
You can choose from a variety of marketing strategies, including Google ads, social media ads, and word of mouth. At the most basic level, you want to optimize your business website for SEO and use all the online marketing tools that come with your eCommerce platform.
Once your eCommerce business is up and running and you start taking orders, it’s a good idea to keep track of which marketing strategies are working and which aren’t, especially if you’re investing. Over time, you can adjust and change your marketing strategy to find what works best for your business.
How much does it cost to start an e-commerce business?
Now that you’ve gone through all the steps involved in starting an e-commerce business, you might still be curious about one important factor: cost. As you can imagine, starting an online business can save you a lot of the costs associated with brick-and-mortar stores, such as rent, property insurance, and furniture. While it is easier to fund an e-commerce business on a budget, there are still a few costs involved to get started.
As with all businesses, it is difficult to pinpoint exactly how much it will cost to start an e-commerce business. Start-up costs vary greatly depending on, among other things, the type of e-commerce business you start, the software or platform you choose, and how you get your products.
With this in mind, you can start by thinking carefully about your budget, and keeping track of all your expenses. In particular, the following fees should be considered:
Business licenses and permits: Depending on the type of business, its location, and who it sells to, different license and permit fees may apply. Some states charge lower fees. From 10 to 10-50 dollars, while others may charge hundreds of dollars.
E-commerce software: Ope-source platforms are free to download, but there are other costs (development fees, hosting, plugins, etc.) associated with this type of solution. On the other hand, with a comprehensive platform, you can find some of the simplest options at an affordable price ($12/month for Square’s online store, for example). More advanced and extensive solutions cost more with a $300 per month Shopify Advanced limit.
Domain Names and Hosting: Some eCommerce solutions include the domain name or hosting at the price of the platform, and some allow you to purchase the domain name through them. However, if you need to purchase your domain name and hosting, you can expect to pay anywhere from $1 per year for the domain to around $15 per year and an average of $30 per month for hosting.
Payment processing: To accept online payments, you will need to work with a payment processor such as Square or Stripe. Again, some eCommerce software solutions will include their payment processing platform, while others will allow you to integrate with your preferred system. You usually pay around 2.9% plus $0.30 per transaction that occurs in your store.
Inventory and Shipping: Depending on what you’re selling, your inventory and shipping costs can vary widely. However, of all the costs we’ve discussed so far, your initial inventory investment is probably the largest. You should purchase your inventory with care, especially when you’re just starting – you don’t want to overspend on products you can’t sell. Of course, your shipping costs depend on your sales, the shipping service you use, the size of the product you ship, and the shipping speed options you offer your customers.
Marketing and Advertising: As a general guideline, you can spend around 6% or 7% of your gross sales on marketing and advertising. Since you’re just starting, this can be hard to measure, so you should take advantage of all the free marketing and advertising options available to you. Then, once you have a better idea of what works well for your e-commerce business, you can start exploring paid options for promoting your business.
There may also be additional costs for things like equipment, business insurance, employees, consultants, and more.
Roxanne King, the owner of the e-commerce site The Holistic Mama, says some of the extra costs are unavoidable and some are worth the investment. For example, King says that for an extra $50 a month, you get extra features on your Shopify store, like automatic shipping and pop-ups to increase sales, and it’s worth the investment.
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Tips for Starting a successful online store (Ecommerce Business )
Just like starting a new business, starting an eCommerce business can sometimes be tedious and stressful. As a member of the online merchant community, you have access to a wide range of entrepreneurs and business owners who are likely to be happy to provide advice and best practices to help you get started. I spoke with Roxanne King, owner of The Holistic Mama, and asked her to share her three success secrets.
1. Easy Start
In 2011, after years of struggling with pregnancy and commercial products containing preservatives, King, now a health blogger, began developing and refining her own natural homemade skin care products. A few years later, she switched from giving away free home cleaning supplies to farmers’ markets and selling online by launching an e-commerce business. “At first I didn’t name him mayor. “For several months, I only sold one product on my blog page called Store,” says King. “There is a PayPal-only button that I took from my PayPal website and copied to my WordPress blog. “
He cites his small start as one of the reasons for his future success (he was able to streamline his sales and shipping process before moving on to bigger sales and ultimately needed a more user-friendly and secure platform), but now he uses Shopify.
2. Share your business across multiple channels
King admits he created the blog “accidentally” to start his business two years before he launched it, and encourages others to do the same. “I already have a lot of followers, so clients trust me as soon as I first offer a product,” he says.
3. Invest in multi-channel selling.
King’s Holistic Mama products are now available at Whole Foods and Expanded Stores. We also list some products as third parties on Amazon. Small business owners who have their websites but also sell on Amazon (often considered competitors) cover almost every corner of the market. “While Amazon makes up a very small percentage of my sales, it’s important to be there because some people only shop on Amazon,” King said.
Selling through larger stores like Amazon also comes with other benefits, such as the ability to check how popular your products are expected to be, reduced shipping costs if you use Fulfillment by Amazon frequently, and a built-in trust factor.
Make it easier for your customers to shop on the marketplace. Some consumers remain leery of online shopping but trust verified Amazon sellers to process their orders promptly.
While maintaining your own business and vision is paramount to starting an eCommerce business, you shouldn’t rule out using a larger platform to increase your sales and brand name.
Compared to a conventional business, starting an e-commerce business has many advantages. You can start big or small with a much lower initial investment and have your online store open 24 hours a day. 7 days a week for customers nationwide (or worldwide if you’d like to ship further). In addition, it is much easier and cheaper to scale operations if necessary. All of these bring more income to an aspiring entrepreneur starting an e-commerce business.
However, there are important steps to take and investments to make if your business is to become an Internet success story. You have to treat your e-commerce site like any other business — comply with tax laws, get necessary permits, invest in customer interaction and communication, and don’t forget to build a mobile-friendly platform: King says 60% of its sales come via Devices cellular.
Ultimately, King offers this final piece of advice to budding e-commerce entrepreneurs:
“With e-commerce, you have to build trust because people don’t see you in person… so they might be skeptical. The good thing is with blogging and social media it’s easier to build. Give them a glimpse of life and business you, and they will support you.”
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