Detailed Steps to Starting an Ecommerce Business
In the previous article, we skimmed through the steps required to start an ecommerce business. In this, we will be explaining the detailed steps you need to take to successfully start your online busine.
Research the ecommerce business space and find your niche.
The first step in learning how to start an ecommerce business is performing the necessary research. For example, you’ll want to consider what exactly your ecommerce business is going to offer. Will you be selling products or services? If you’re selling products, are they physical or digital? Where will you source your products? Along these lines, you’ll also want to think about the type of business model you want to employ. Will you offer single products, packages, subscriptions, or something else?
Additionally, you’ll want to think on a broader scale during this process as well. Ask yourself questions like how will you get your products or services to your customers? What will your startup costs look like? Are there legal or other regulations on your product or service that you need to keep in mind?
These lines of questioning, among others, will be integral to the beginning of your business. It will also help when you’re writing your business plan. This process will give you a better sense of your specific goals and how you’re going to reach them.
Another important step, particularly in the ecommerce space, is finding your niche. The growth in the ecommerce business industry while being a great benefit also means more competition. Therefore, you’ll want to perform competitor research. Doing this will help find a space where you can establish your brand and find success in selling your products/services.
Select your ecommerce business name and choose a legal structure.
As soon as you’ve carried out the necessary research for your ecommerce business, the next step is to choose a name. Like any other business, you’ll want to choose a name that’s unique, but also that clearly indicates what your business is or does. You’ll likely want to consult your local business registration authority or a trademark office when doing so. This is to ensure that you’re not choosing a business name that’s already claimed by another company.
At this point, it will be wise to check for the availability of your potential business domain name. If your domain name is currently being used, you may consider a different business name, or a different structure. You could opt for a ‘.co’ extension instead of a ‘.com’.
After you’ve selected a name for your business, you’ll want to choose your business’s legal structure. The business entity type you choose will have important legal and financial implications for your ecommerce operation. Generally, you’ll choose to create a sole proprietorship, general partnership, LLC, or corporation. There are benefits and drawbacks to each of these entity types. For this part, you may decide to consult an attorney or another legal professional for advice on the best option for your business.
Obtain business permits and licenses.
The next step to starting your ecommerce business is to obtain any business licenses or permits you need to operate legally. Permits vary according to the state or city/district you’re in. Each state have their different requirement, but you will often need general operating license issued by the state. Depending on where your business is located, you may also need to acquire a local operating license as well.
Because most ecommerce businesses are generally home-based, they do not require as many business licenses and permits as brick-and-mortar stores. However, you’ll want to determine what the specific requirements are in your area. You can usually find this information online via your state or local government website.
Some types of business licenses and permits that you may need include:
Professional and trade licenses for certain industries
Sales tax permits
Health, safety, and environmental permits
Building and construction permits
Choose your ecommerce business platform and create your website.
At this point, you’ve completed the paperwork required to register and legally start your ecommerce business. In this way, the majority of our steps thus far have mirrored the process of starting a brick-and-mortar business. Now, however, instead of searching for a location to set up your physical store, you’ll start creating your website/online store.
Like a physical storefront, this website will be the face of your business. It is what your customers will see first and what they’ll use to browse and purchases your products or services. With this in mind, creating your website will be one of the most important parts of starting your ecommerce business. Therefore, you’ll want to consider a few different points as you develop your online storefront.
First, you’ll want to think about your domain name, as we mentioned step two. You’ll want your domain name to match or closely match your business name. Also, you will have to choose what ecommerce platform you’d be adapting for your business. Whether an all-in-one software, like Shopify, or an open-source platform, like Magento. Your ecommerce platform will be the base you use to build and develop your online store.
This being said, most ecommerce platforms have several functionalities. Not only do they allow you to create and launch your online store, they also customize your design. You can add your domain (or purchase one), manage inventory, take, and ship orders, receive payment, and more.
Currently, there are hundreds of these platforms available on the market. However, you might want to consider any of the following popular solutions for starting your ecommerce business.
Source or develop your products.
After you’ve chosen your ecommerce platform and started your website, you’ve almost reached the end of the process. At this point, you’ll need to actually source the products you’re going to sell. Luckily, you should have already thought about how you’re going to go about this process when you performed your research in step one. You may make your own products, source them from distributors. Also, if you’re selling your own services, like as a consultant, you may simply have to describe and list these services on your business website.
If you’re selling products, as you might imagine, this step will be more complex. This is because you’ll need to consider the inventory you want to start out, as well as what these startup costs will look like. You’ll also want to make sure that you take the time to list your inventory on your online store. You’ll also have to think about the customer experience, SEO, and the way the process will work from when a customer purchases a product to when they actually receive that product.
Market your ecommerce business.
Now that you have your products or services prepared and listed on your online store, your website is up and running, you’re ready to start serving customers. In order to do this, of course, you’ll need to properly market your ecommerce business.
There are a variety of marketing strategies you might decide to utilize—Google ads, social media ads, word of mouth, and more. At the most basic level, you’ll want to optimize your business website for SEO. Also, you should take advantage of any online marketing tools that are included within your ecommerce platform.
This being said, as your e-commerce business is up and running and you start to receive orders, you’ll want to keep track of which marketing tactics are working and which aren’t. Especially if you’re investing money in them. With time, you’ll be able to adjust and change your marketing strategy to find what works for your e-commerce business.