How To Start An eCommerce Business 2024

Introduction To eCommerce Business: How to start an eCommerce business is not simple but setting up launching, and maintaining sites where entrepreneurs, designers, and creators of all types can sell their products, is more obtainable than ever.

How To Start An eCommerce Business
How To Start An eCommerce Business

An eCommerce business is a type of business that transmit product, services, and funds over the net varying in size and scope, from retail jumbo like Amazon to Etsy craft sites. Online shopping is one of the areas that have seen intensive growth over the past five years.

Depending on your goals, you could start an eCommerce business. After all, while not the requirement for a brick-and-mortar location, eCommerce businesses provide larger flexibility, affordability, and a chance for several entrepreneurs.

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How To Start An eCommerce Business

While there are notable differences between starting an eCommerce business compared with starting a brick-and-mortar business, there are also several similarities. As we will discuss many of the planning and legal steps you will need to follow. But, once it starts your operation, you will see how different starting an eCommerce business can be.

Do eCommerce Space Research

To start an eCommerce business is performing the necessary research this step is the very first step. Just as if you were starting a restaurant and looking into different locations, food options, and themes, you will want to investigate the eCommerce area you are interested in and make some decisions about your specific business.

For example, you will consider what exactly your eCommerce business is going to offer. Will you be selling products or services? If you are selling products, are they physical or digital? Where will you source your products? Along these lines, you will also want to think about the type of business model you want to employ, will you offer single products, packages, subscriptions, or something else?

As well, you want to think on a broader scale during this process. 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?

This process will give you a better sense of your specific goals and how you will reach them. Particularly in the eCommerce space, an important part of this step is finding your goal.

The growth of the eCommerce industry is a great benefit for those looking to learn how to start an eCommerce business. You have to perform competitor research and find a space where you think you can establish your brand and find success in selling products and services.

Selection Of Your Business Name

Like any other business, you will choose a unique name, but also that indicates what your business is As well, you will not want to invest too much time in a website, it will be worthwhile to check to see if your potential business domain name is available. If your domain name is currently being used, you may consider a different business name or a different structure.

The business entity you pick will have important legal and financial implications for your eCommerce operation. Generally, you will choose to create a sole proprietorship, general partnership, LLC, or corporation. There are benefits and drawbacks to each of these entity types, so you may decide to consult an attorney or another legal professional for advice on the best option for your business.

If you choose to start a general partnership, you do need to register in the state where you are operating. Instead, your business will be legally associated with your name, meaning if you want to operate under the name you selected, you will need to file a doing business application with your local government.

Apply for an Employer Identification Number

You will apply for an employer identification number, for your eCommerce business. Not all business entity types are required to have an employer identification number, this nine-digit number can be useful to help you separate your personal and business finances.

You can apply for an employer identification number from the IRS, for free either online, by mail, fax, or by phone. Since you are learning how to start an eCommerce business, you will apply for this business tax ID online, and once you do, you will receive your number instantly.

Business Permits and Licenses

After you have applied for your employer identification number, you will now want to obtain any business licenses or permits needed to operate legally within your city and state. As we mentioned above, if you have established your eCommerce business as a sole proprietorship or general partnership, you do not need to register your business with the state.

For the other business entity types, but, you will need to register your business with your state and receive a general operating license. Depending on where your business is located, you may also need to acquire a local operating license as well.

Anyway, if you 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.

For example, most locations require that home-based business owners receive a home occupation permit to legally operate. This type of permit simply shows that by operating your business out of your home, you are not adding traffic, noise, or problematic conditions to your location.

Some other 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.
  • Signage permits.
  • Building and construction permits.

Choose an eCommerce Platform

Now you have completed the required paperwork 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. Instead of searching for a location and preparing to set up your physical store, you will start creating your website and online store.

Keeping this in mind, creating your website will be one of the most important parts of starting your eCommerce business. You will consider different points as you develop your online storefront.

You will think about your domain name, as we mentioned above. You want your domain name to match your business name. Along these lines, perhaps your most significant decision will be choosing an eCommerce platform.

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.

Most eCommerce platforms not only allow you to create and launch your online store, but also customize your design, add your domain, manage inventory, take and ship orders, receive payment, and more.

As well, there are hundreds of these platforms available on the market, you might consider any of the following popular solutions for starting your eCommerce business.

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This is the most well-known and popular eCommerce software out there, Shopify offers an all-inclusive, user-friendly solution with a variety of add-ons.

You can purchase a Shopify subscription in one of four plans, starting with Shopify Lite at $9 per month.


If you already have started a WordPress site, or are familiar with the platform, you can download WooCommerce to start selling on your WordPress site. This plug-in is open-source, free to download, and includes a full range of e-commerce features.

Compared with Shopify, WooCommerce is best suited for business owners who have some technical knowledge to take advantage of its open-source nature.


Squarespace offers eCommerce capabilities and is known for its modern templates. You can choose from two eCommerce-specific plans from Squarespace, Basic at $26 per month or Advanced at $40 per month.

Like Shopify, Squarespace is user-friendly and can accommodate business owners of all technical skill levels. Also, as a website builder first, Squarespace may not offer as many features, tools, or add-ons as some other alternatives.


If you want to customize every aspect of your online store, you might choose to use the open-source version of Magento. With this eCommerce platform, you can manipulate every element and customize your site, but you also must have the technical skills to do so.

As well, it is safe to say this platform is not typically suited for e-commerce beginners, if do have the technical skill needed or the budget to pay to work with a developer, you will find that Magento likely offers the most of any open-source solution on the market.

As you can see, there is a lot involved with this step and a variety of important considerations to take when choosing the right platform for your eCommerce business.

You will think about cost, features, and usability, as the backbone of your eCommerce business, you will need a functional system that allows you to get up and running and manage your operations on a day-to-day basis.

Once you have decided which solution is right for you, the next thing you will need to do is work on customizing and launching your site. You will think about how you want your online store organized, what you want the design to look like, what colors you want to use, etc.

Depending on your platform and budget, you may decide to create and launch your website yourself, or you might invest in a professional designer or developer for assistance.

Market Your eCommerce Business

You have learned how to start an eCommerce business. Now that you have your products or services prepared and listed on your online store, your website is up and running, you are ready to start serving customers. To do this, of course, you will 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 will optimize your business website for SEO and take advantage of any online marketing tools that are included within your e-commerce platform.

As your eCommerce business is up and running and you start to receive orders, you want to keep track of which marketing tactics are working and which are not, especially if you are investing money in them. As time progresses, you will be able to adjust and change your marketing strategy to find what works best for your business.

What Will Be The Cost To Start An eCommerce Business?

So, now we have gone through each of the steps involved in how to start an eCommerce business, you may still be curious about one important factor, which is cost. As you might imagine, by starting an online business, you will be saving on a variety of costs that are associated with rent, property insurance, furniture, and more.

It is easier to fund an eCommerce business on a tight budget, but there are still several different costs that will be required to get started. As is the case with any business, it is difficult to determine exactly how much it will cost to start your eCommerce business. Your startup costs will largely depend on the type of eCommerce business you are starting, the software or platform you choose, and how you are sourcing your products, among other factors.

Keeping this in mind, you will think about your budget carefully as you start and keep track of all of your expenses along the way.

eCommerce software:

Although it may be free to download an open-source platform, there will be other costs associated with this type of solution. For an all-inclusive platform, on the other hand, you will be able to find some of the most basic options at low prices. More advanced and expansive solutions will require greater costs, with Shopify Advanced capping at $300 per month.

Domain name and hosting:

Some eCommerce solutions will include a domain name or hosting within the cost of the platform and some will allow you to purchase your domain name through them. 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 like Square or Stripe. Once again, some eCommerce software solutions will include their payment processing with the platform, whereas others will allow you to integrate with your preferred system.

Inventory and shipping:

Depending on what you are selling, your inventory and shipping costs can range exceptionally. Anyway, for all of the costs we have discussed thus far, your initial investment for inventory will likely be your greatest.

You have to purchase inventory carefully, especially when you are starting, you do not want to spend too much money on products you will not be able to sell. Your shipping costs, of course, will depend on your sales, the shipping services you use, the size of the products you are sending, and the shipping speed options you offer to customers.

Marketing and advertising:

As you are starting, this can be difficult to estimate, so you will certainly want to take advantage of any free marketing and advertising options you have available. Then, once you have a better idea of what works well for your eCommerce business, you can start exploring paid options for promoting your store.

Key Points To Start eCommerce Business

As part of the online selling community, you will have access to a variety of entrepreneurs and business owners who will very likely be willing to offer their tips and best practices to help you as you start.

Share Your Business Across Multiple Channels

Sharing your business, or brand, across social media channels like Facebook, Instagram, Twitter, and Snapchat can be particularly useful when you are just starting your eCommerce operation. These kinds of early marketing are free and can be used to drop hints and build excitement about upcoming launches or product reveals.

Multichannel Selling

Small-business owners who have their site but also sell on Amazon, often seen as a competitor are simply covering every corner of the market.

There are other benefits to selling through a larger outlet like Amazon, including the ability to test whether your product will be as popular as you predict, lower shipping rates if you frequently use Fulfillment by Amazon, and a built-in trust factor that often facilitates purchasing by customers on the Amazon marketplace. Some consumers are still wary of online shopping, but trust that an Amazon-vetted seller will fulfill their order promptly.

Although maintaining your store and vision is paramount to starting an eCommerce business, you also should not rule out using larger platforms to help elevate your sales and brand name.

Advantages Of Starting An eCommerce Business

There are plenty of advantages to starting an eCommerce business instead of a brick-and-mortar one, the initial investment is much lower, you can begin big or small, and your online store can operate 24 hours a day, seven days a week, for customers all over the country.

Important steps to take and investments to make if you want your business to emerge as an internet success story. You should treat your e-commerce website like any other business stay compliant with tax laws, obtain the necessary permits, invest in customer retention and communication, and do not forget about building a mobile-friendly platform.

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