Like a physical one, an online store requires investment to generate awareness, increase sales, and see returns. However, unlike a physical business, your online storefront can reach many customers regardless of their location.
Your online store is an excellent location to invest, expand your reach, and build your business because it has nearly endless growth potential.
But being successful in the growth process isn’t that simple. You have to bear the cost of starting the business online, depending on the nature of the store you hold.
Whether selling online or off, all business models need some investment to get started and continue working. But it also largely depends on the nature of the online business you want to create. A store that sells goods is different from a store that sells services.
When building an e-commerce business, people may ask:
- Are you a business-to-business (B2B) or business-to-consumer (B2C) seller?
- How much capacity does your online business have to manage shipping requirements?
- What will your advertising tools be?
- Are you thinking of discounts and rebates to engage your customers?
Different online sellers may have different answers to these factors depending on their control strategy. Now you need to figure out your control strategy and decide on your course of action. But there are some common costs you need to bear while selling online.
1. Domain Name
A domain name is required if you wish to have a website. Users will put in your domain name to reach your company’s website.
You must purchase a domain name for your website to be visible on the internet. This is because you have complete control over where you buy your domain name. The price can vary substantially.
2. SSL Certificate
A Secure Sockets Layer (SSL) certificate is required when creating an online store. When they visit your site, people want to feel protected as customers give out personal information such as credit card numbers and addresses. An SSL certificate will assist you in encrypting this sensitive data.
Businesses with a secure site include “https” in their address and a padlock next to it to indicate that it is secure.
3. Payment Processing
The payment processing costs are easy to miss, but they may quickly pile up. The type of payment you wish to accept during checkout. The currencies you’ll receive, and the countries you’ll be selling all influence payment processing expenses.
Each payment gateway you want to offer will charge you a fee, and this fee does not include any hidden charges charged by your bank.
If you are into product selling as an online business, you must also focus on product marketing. A budget is needed for SEO, pay-per-click (PPC) ads, and other different types of digital marketing strategies and social media.
Product marketing will assist you in raising brand awareness and driving visitors to your website. All these forms of marketing will indirectly affect your sales volume. But for that, you have to bear these expenses.
5. Inventory Management
Even if a third party handles the inventory and delivery costs, an online store will have some inventory and shipping fees.
Just like you manage your physical stores and manage inventory there. For your potential customers, the same is to be collected online. Also, it’s not just an initial cost; it’s ongoing.
6. Logo Design
A logo may help your business stand out and build long-term brand recognition. A logo can cost anywhere from zero to thousands of dollars, depending on the quality, file types, and revisions you require.
Browse for people who have five stars and review their portfolios before making a decision. For a one-time fee, you get dozens of designs from many designers to choose from. So, if you want to appear professional and differentiate your product, bear this cost.
Since an internet store has so many components, you may choose precisely what you need and pay for those services. Depending on the features you require for your business to succeed, you may be able to establish an eCommerce site to start with for less than $1,000.
And you can always use the preset store templates that Shopify, Shoplazza, and many other drag-and-drop website builders provide. Paying a few subscription fees will save you a lot of time and money. Make your calculations ahead of time because placing your business online promises to expand your reach and increase revenue.
So pay the price and enjoy the benefits.
(Contributed by Aloukik Rathore & Hermes Fang)