Opening An Online Store Costs And Investments

Do you want to open an online store?

Do you know the costs you will have to bear and the necessary investments?

If it is true that there are platforms on which it is possible to create the first skeleton of an e-commerce site for free, it is also true that you need to make updates or add features. The features that allow us to offer a complete and not “sketchy” shopping experience are not always accessible; on the contrary. Here’s why and what budget to foresee for starting a new e-commerce.

Opening e-commerce involves inevitable costs, not only of a technical nature.

 Like everything related to the web, you need investments to obtain effective and satisfactory results to keep an electronic commerce project going. In addition to choosing the most suitable CMS among the various e-commerce platforms available, the intervention of a web designer who customizes the front end must also be considered for the website and, therefore, of a good programmer who knows how to transform graphic PDF files into a beautiful and easy to navigate site, are essential for a quality result. The programmer will also always handle technical aspects, security, and commerce. 

Selling online is not easy due to the competition, which has been operating on the web for longer than we have. Furthermore, search engines, without a brand awareness activity that takes advantage of social networks and a bit of SEM on Google, do not index e-commerce that is not made visible by paid activities.

What you need to do before starting an e-commerce

If you want to open an online store, you must follow a bureaucratic procedure to create your company. In fact, even for an online shop, it is necessary to open a VAT number and communicate to the Revenue Agency and INPS, then register with your municipality’s Chamber of Commerce and SUAP (One Stop Shop for Productive Activities).

Once your company has been registered, you must comply with a series of rules and requirements for your e-commerce. Make sure you comply with the European Directive 2011/83 regarding compensation. The deadline for returning goods is 14 days; your users must know this, and above all, they have the right to do so.

Suppose you have to apply any return costs to the user. In that case, you must specify this in advance, i.e. at the time of purchase or on a specific e-commerce page, so remember to foresee this eventuality.

While you define all these aspects and prepare the ground for your e-commerce, a preliminary activity that we recommend you do is create your own contact database. To study your market and the people you want to speak to, and above all, to whom you want to direct the sale of products, try creating a simple landing page, i.e. a landing page focused on a type of product or an entire category where give interesting content in exchange for an email contact.

For example, if you intend to open an e-commerce site for light bulbs for children, create a page with a short 30-second video in which you show how the light bulbs work. In the video, you will show the level of light they provide and the colours available and ask them to enter the email address of the person watching the video in a contact form. In exchange, you could offer a small ebook, a guide or an infographic with the five secrets for sleeping for little ones. Store the emails in an email marketing tool, and when your e-commerce is ready, send a newsletter to all contacts with a discount code to purchase your products.

What are the steps to open an e-commerce?

To open e-commerce, you need to proceed step by step.

1. Target analysis: Who are your e-commerce products or services aimed at? This is an essential phase that you must do to understand how to set up the communication of the site itself. Whether it is a b2c or b2b target, you must create buyer personas, i.e. models of ideal consumers who should purchase from your e-commerce. Give them a name and an age, but above all, define their interests, desires, and what they like and expect to find in your online store.
2. Definition of the budget: consider a 360-degree budget, starting from the platform the hosting provider, from purchasing the domain up to all aspects related to security (SSL certificates, tool subscriptions online for policies, dedicated server with daily backup programs, etc.).
3. Analysis of the commercial proposal. Choose carefully what you will sell on e-commerce because. Unless they are products that no one sells in Italy (or abroad) – which is quite rare – do not believe that an e-commerce with a catalogue of 2000 products can generate more profits than one with 100 products. Focus on those that have a reason to be present in the online store that you can really manage, and over time, you will understand, from the performances and, therefore, from the purchases, which will be the peak ones and the least requested ones. Remember that each product must be enriched by an effective product sheet with quality photos and exhaustive descriptions, so 2000 or 100 products make the difference in terms of time spent finalizing the catalogue.
4. Choice of payment methods. It is important to choose immediately, even before proceeding with the graphics of the pages, the payment methods that you will make available to customers: bank transfer, cards, cash on delivery, collection at the point of sale in cash and PayPal are the most used, to which are added the Mobile Payment systems. E-commerce companies usually accept credit card payments via the POS system offered by banks or with PayPal; not including them in payment methods risks cutting out many customers.
5. Shipping Arrangements. The choice of courier is fundamental, one of the most important phases, because a wrong choice can mean the abandonment of your customers. If they receive the goods within the times communicated, they will be satisfied; if you can do it in a very short time, they will be loyal. Remember to evaluate all the options that couriers make available. The important thing is that the product arrives intact, on time and at an affordable price (and if the shipment is tracked even better, your customers will appreciate it).
6. E-commerce management. Just as in a physical store, it is necessary to have dedicated resources; it is also necessary to allocate the right human resources for e-commerce. Who will manage online orders, contact requests and update the site? Then consider, if you do not purchase a hosting plan that provides automatic updates, a resource that checks the security status of the site on a daily basis, its loading speed and any technical problems that may emerge.
7. Promotional investments. E-commerce may be the most beautiful in the world, but if no one knows it exists, no one will get there. Plan a digital marketing plan to give visibility to your online store considering social networks (which ones make sense to invest in?), paid campaigns, Google Ads, link building through articles on other platforms and blogs to generate traffic, possible affiliations, marketing activities email marketing and so on.

The technical aspects of starting an e-commerce from scratch

The first step is purchasing the domain, the address your online store will have. It is always best to purchase both .it and .com and possibly the others included ( .store, etc). This is an annual cost, which for the first year could be very low by promotions that sites such as Register, Aruba, Server Plan and others grant.

The second step is purchasing a hosting service provided by a hosting provider, the costs of which range from 50 euros for shared hosting to 1000+ euros for dedicated hosting. For an e-commerce, it is advisable to choose the second solution, i.e. Dedicated Hosting, which will only host your site. If you have a technical resource capable of managing the configurations and maintenance of the servers independently, you can choose this option; otherwise, with a managed plan, the provider’s technicians manage the dedicated servers.

The next step is the choice of the technical platform with which to create the store. Opening e-commerce with the available open-source platforms is relatively easy, but it is very limiting. Prestashop and WordPress are valid free alternatives, but it is necessary to consider the possibility of a more extensive customization intervention made possible only by purchasing a paid plan payment or implementing plugins and extensions.

Alternatively, you can evaluate rented platforms that allow, in exchange for the payment of a real periodic rental, the creation of an e-commerce site with a package of services (but pay attention to what this package includes). Finally, the most expensive solution is to create a proprietary website designed by a graphic designer, who creates the layout of each page and is developed by one or more programmers who build it based on the chosen graphics.

What determines the cost of e-commerce?

When you create a brief for the online store project, you must carefully evaluate the cost of the site. This is not unique, nor can we give an indicative figure because many variables are at play.

The type of e-commerce you intend to create certainly influences the project’s cost. Depending on the number of products to manage, you will have to opt for one platform rather than another: for example, Magento is the ideal solution for e-commerce with several hundred products, and the investment it requires is undoubtedly essential. 

Suppose the e-shop you intend to open is small or medium-sized. In that case, the recommended intermediate solution is represented by Prestashop, a free CRM. Still, it allows the customization of the site template or the addition of modules, i.e., extensions that include many features. It presents an official marketplace, PrestaShop Addons, with many options. The open license allows constant modifications and updates by users, who constitute a vast community offering assistance for the most varied problems. In short, it is a turnkey solution to be immediately operational, but it allows you to go a long way with customization.

Advice and considerations

Starting e-commerce means investing and, as such, requires careful analysis. It is not enough to open an account on a free open CMS: it is necessary to identify more performing servers and hosting, add extensions, plugins or addons that complete the project and provide a digital marketing plan that includes paid ads on social networks or on Google.

If it is true that anyone can open an e-commerce today, it is also true that it is necessary to have a budget that will bring more results the more intelligently it is spent. This does not mean you will obtain greater revenues with more significant investments, but a zero investment will certainly bring 0 results.

Also Read : How To Set Up An Online Store For Coffee Shops And Cafes