The internet has given us new commerce opportunities where entrepreneurs can interact with potential customers to grow their business. According to small biz genius, in 2019, about 14.1% of global retail sales were made online.
This dramatic growth is caused by customer demand and changing shopping habits. Without a doubt, the internet is the future of business, especially retail trade.
Also, selling online can be very cost-effective as there are lesser overhead costs compared to traditional"bricks and mortar" business. However, before you start your e-commerce business, there are some costs which you should expect before your first sale.
So, in this article, I’ll reveal exactly how much it costs to start an E-commerce business.
As an e-commerce business owner, your capital will be relatively low-cost, but your most important resource will be your website. As a bare minimum, you’ll also need to pay for hosting, web development, maintenance, and inventory. So, the average costs for these include:
To self-host, you will need a domain name,a web-host, an inventory and a payment process. Your domain name is the name of your website or online shop. You’ll need a domain name for your website if you want to start an e-commerce business. Domains are really cheap($0.99-$25/year) and you’ll often find them easily.
A web host is the fee you pay to host your website or online shop on a hosting provider’s server. Without hosting, your website won’t be connected to the internet so your target market can find it.
For a new e-commerce business, shared hosting is recommended because it is cheap($3.50-$40/month). This hosting is also good if you get less than 100,000 visits on your site per month. After that, you’ll want to upgrade to a private hosting for better speed. This is more costly (usually at $200/month), but can be more reliable.
Another important factor to consider is the cost of your inventory. Whether you’re making the products yourself or ordering them in from suppliers, the amount you invest here will vary greatly,depending on the product you are selling and your mode of shipping.
While starting an e-commerce business, you will need an integrated payment system. Most payment processors charge you roughly 2-3% plus $0.30 per transaction.
2. Shop440 ($5-$50)
Shop 440 gives you all the tools you need to manage your online shop, and even help you with logistics and receiving payments from anywhere in the world. So, if you do not want to take option 1 above,which could be rigorous and time consuming, you can go for Shop440 that has everything you need in one place to run your online store. Most importantly,Shop440 is affordable and more convenient.
These costs are important to keep in mind when choosing a self-hosting plan as well as the products to sell so you can have a unique pricing system that will reward you.