Most ecommerce businesses operate solely on the internet. Unlike a brick and mortar store, the ecommerce store requires little initial investment. It’s possible to offer services, such as consultations, or products of almost any type online.
Starting your ecommerce website with a domain registrar business may be less expensive than engaging a third-party service. The domain registry may offer inexpensive or free tools to help you quickly start your ecommerce business.
Before You Put Up an Ecommerce Site
Before putting up your ecommerce site, make sure you’re adequately funded. Take out a bank loan or a private loan to ensure you have working capital. If your service is unique or in great demand, look for an angel investor to capitalize the business.
Angel investors are wealthy individuals with capital to invest in exchange for a participation in the business. It’s also possible to apply for a grant or loan from your local municipal or state government or from the federal government in some instances.
Identify an Ecommerce Hosting Company
Your domain registrar may also offer website hosting services. A site host provides space for your ecommerce site on its servers. Many hosts offer a variety of different packages. Depending on your needs, it’s possible to select a basic, low-cost monthly rate or a high-traffic business package.
Look for a host package that’s designed especially for ecommerce businesses. It’s often possible for the site host to tailor the package to your ecommerce site’s specific needs or bandwidth requirements.
Create an Ecommerce Store
If you’re a web designer, you may have all of the programming knowledge needed to create your ecommerce store. Otherwise, you’ll need a web designer or programmer to create an ecommerce store.
Assuming you need to engage a designer, he or she will create a site plan that addresses what your ecommerce store needs to accomplish your goals. Ask the designer for input at any stage of the process. If your designer offers updating services, ask questions about what this service will cost.
Arrange Business Bank Accounts
If you haven’t already done so, arrange a business bank account at a local financial institution or credit union. Don’t co-mingle your private and business cash flow. Discuss your business plan with a financial adviser or attorney. It may be a good idea to register the new ecommerce site as a Limited Liability Company (LLC) to reduce your personal financial risk.
Your ecommerce site may need employees in the real world. For instance, if you sell a product that requires package and shipping services, you may need to hire an employee to perform these services. Alternatively, you may identify a drop shipper to simultaneously manage inventory and shipping services.
Although you probably won’t hire a full-time bookkeeper in the early days of your ecommerce business, it’s important to have a professional financial adviser onboard in some capacity. You need someone to keep accurate business books that record incoming cash flows, expenses, and net revenues.
Ask your CPA about whether you’re required to make quarterly tax payments. He or she can advise you about business finances and may assist you in identifying tax deductions to reduce taxes owed. Importantly, your CPA will make sure you pay business taxes when they’re due.