In the last few years, the e-commerce business has experienced a sustainable as well as drastic transformation, especially during the pandemic. Like other firms, e-commerce has also become an essential part of our retail cycle of buying and selling goods. With the modernization of the world, there is a remarkable increase in online transactions and people are earning revenue from it in a wide range.
It is an overwhelming idea to start an E-commerce business of your own especially when you have an amazing idea and spirit to become a successful entrepreneur. It is hard to establish a business and more difficult is to lift it high, it requires skills, creativity, and patience. This business has great potential of earning revenue. Apps like Magento and Shopify are the best examples of e-commerce business platforms that help you in setting up and hosting your business or online store.
The rise in the E-commerce business is marked especially during COVID-19 and it is continuing. People all around the globe find it more comfortable and safe to buy goods over the Internet instead of moving off to shops and malls. According to Statista, Global retail e-commerce sales were estimated to be at 5.2 trillion dollars in 2021. By 2026, this amount is expected to have increased by 56%, reaching approximately 8.1 trillion dollars.
Let us begin with the definition of an e-commerce business, its types, and features.
What is an E-commerce Business?
A business that sells products, services and generates revenue over the Internet is known as an electronic-commerce or e-commerce business. It can be a small-scale business as well as a large or multi-million organization. It can be any business like apparel, personal care, electronics, hardware, or services like web designing, software development, etc. An entrepreneur with a great selling strategy can attract a large global audience with less overhead cost. You can operate an online store from a single website or by using a variety of online platforms, including social media and email.
There are two main types of E-Commerce business:
- B2B e-commerce: it refers to wholesale suppliers and service providers like office supply stores, IT services or software companies, etc.
- B2C e-commerce: It includes retail stores like apparel, electronics, home goods & groceries, personal care products stores, etc.
- C2B, C2C, B2G, C2G, G2B & G2C are some other types of E-Commerce businesses.
How Does an E-Commerce Business Work?
An e-commerce business is similar to an offline business, it involves selling and purchasing goods and services but over the Internet. Using a variety of electronic platforms like websites or social media channels, E-Commerce connects buyers and sellers so that people can locate and purchase your goods and services. Then the purchase is processed by a payment processor and after the transaction is completed, the order confirmation message is sent to the consumer via SMS or mail.
When there is a purchase of goods, the seller delivers the product and provides delivery details like tracking no. to the customer and if the transaction is for service, the service provider will contact the customer and schedule the appointment. So, the e-commerce business works in three steps basically i.e. place\accept the order, process the order and ship it.
This business eliminates the effort of going out to purchase the needs & furthermore, it provides a wide range of global customers and service providers as the store is not limited to the people of a specific area or location.
Steps to Start an E-commerce Business
There are a wide range of e-commerce businesses and the process of starting them also depends upon the type of business. For instance, if you are starting a business selling goods online you will also have to track the inventory and manage its fulfillment while a service provider doesn’t have an inventory. Following are some basic steps that can assist you in starting an E-Commerce business of your own.
Research your E-Commerce model
There are many E-Commerce models in the market like B2B, B2C, etc. to start your business. The first step is to choose the right model for your business whether you want to become a wholesaler or a retailer.
Once you are done with deciding e-commerce models then you can move towards deciding the products or goods you want to sell.
Picking up your niche
There are unlimited options for you when it comes to starting an e-commerce business but for a successful business, you will need to pick up a perfect niche for your business according to your expertise and experience. There is high competition in the market. You will have to research hard to choose what you want to sell and what is its demand ratio.
Also, you should gain knowledge about the problems faced by the other sellers who are selling the same product as you and why. This will help you improve the ways of selling and you can resolve those problems to earn more profit.
Make a business plan
After deciding on the product or service that you want to sell, prepare a systemic business plan. Write your plan which should include details about your vision, objective, finance, and marketplace. It should have details about your competitors, their marketplace, range of products, and how you will compete with them.
An impressive business plan can attract potential investors as well. So make sure your plan involves all the details and roadmap of your e-commerce business.
Decide how you’ll get your product
After planning your business, decide how you will get your product if you are selling a physical product. If you can make it on your own, how will you make it? If you will buy it from manufacturers what will they cost for it? How much profit will I get? If you want to buy a product from a wholesaler and resell it or do you prefer drop shipping?
Get answers to all the questions and decide the preferable, easy, and profitable option to get the best quality product that makes customers revisit your store.
Give your business a suitable name and create your brand
Your name is your identity, the name of the business will identify your store, your brand, and your product as well. Your name should not only be unique but also represent your product. It should clarify what you sell and also you will need to check that it is legal and available on social media and web domains. It should be translated easily if you are targeting an audience globally.
Along with the name, you will have to make a logo presenting your brand that will be visible on all your product packaging to make your product stand out in the competitive market.
Register your business
Before starting your firm, you must register it by deciding on a legal structure, requesting an employment identification number (EIN), and acquiring any other permits and licenses required by the business model you have chosen.
If your business startup is home-based, it doesn’t require any legal formality or licenses. Your business type, state, & industry will decide its requirement for registration of your business.
Choose the Platform for your E-commerce Website
To start your business, first, create a domain name that includes your brand name. Afterward, you’ll acquire an e-commerce platform best suited to your business to create an online store. Shopify and Magento are the most common online platforms. Shopify is an easy and simple software suitable for those who are new to e-commerce while Magento is an open-source platform that provides advanced site-management abilities, you can control multiple websites and stores from one admin, provides international payment gateways, provides coupons, email marketing campaigns, product wishlists, promotions, and a gift wrapping option as well.
If you are willing to create an e-commerce business website running on the Magento platform approach a Magento website development company in India to create a website that meets all your business’s requirements.
Using a personal seller account, you can manually list products; or with a Professional seller account, you can post a list of products using the Inventory Loader template. Customers are going to review the product descriptions to determine whether the item will meet their needs. Include all the information necessary for the prospective customer to make an informed choice in your description.
Inappropriate or incomplete descriptions will lead to fewer customer visits or complaints and quick returns resulting in spoiling your reputation. So be clear and honest while describing your product to engage consumers for a long time.
Launch and market your business startup
Now after that, you have chosen your platform, let’s suppose you have selected Magento e-commerce website development and listed your services and products on your website. Finally, your Magento e-commerce business is launched. You are ready to serve your customers but how will your customers reach you? This is a big question that will lead you toward marketing. Marketing your product to bring traffic to your website becomes easy with Magento. Magento development services provide online marketing through emails and messages, campaigns, etc to help your brand hit the online market.
Tips for Creating a Successful e-Commerce Business
- It is quite challenging to establish an online store or business but it is exciting at the same time. To overcome the challenges and hurdles and reach your destined success here are some amazing tips or features that can help you create an outstanding venture.
- Starting from small, it is not important to invest millions in the business, what is important is a sustainable and unique idea that will bloom your business in the coming years.
- Go with the latest trends. Along with a good idea, being trendy is also important. Adopt what’s trending for example online payments.
- Reach your target audience through strong marketing. Conduct A\B testing before launch and promote your brand.
- Partnership and multi-channel strategies can help you gain popularity and attraction. Social media partnerships and showing off your brand on large channels like Amazon can be advantageous.
- Reviews and ratings are the key to attracting visitors and making them customers. Showing off your reviews and rating will be displayed by Google to the shoppers to make informed decisions.
Starting up a successful e-commerce business might seem hard in the beginning. But if you move step by step following the right strategy, making a business plan, and choosing the right platform for your eCommerce online store it becomes easy and exciting. This blog guides you about the necessary steps you need to take to establish your online shop but you can not do it alone, you will need a team of developers to create a proficient design.
For your e-commerce website, you will need a team of developers to create a proficient design. The best advice we can give you is to hire Magento website developers from a leading Magento e-commerce website development company to get a cost-effective, unique, and trendy website in less time.
Are E-commerce businesses profitable?
E-commerce is indeed profitable, and this is expected to continue. E-commerce has a bright future as new business and technology developments create numerous growth potential. Starting a business in this market is exciting and diversified.
What is the cost of developing an e-commerce business website?
The subsequent expenses are common for e-commerce business website which is $5,000 to $10,000 for a well-built eCommerce website, $2 to $20 per year for a domain name & $300 monthly for hosting.
How much does it cost to start an e-commerce business?
It certainly is not going to cost you much if you merely use social media to sell a few goods. However, it will cost you far more to start up an extensive eCommerce store because you will need to purchase shipping goods first. With less than $1,000 in initial investment, it is easy to launch a successful eCommerce company.