Ramdas Shenoy gives insights on how to set up an e-commerce business- some handy tips!
Many businesses post COVID have either already moved to an e-commerce model or at least have an option. The current restaurant business too, cannot be imagined now without a delivery app like #Swiggy or #Zomato and it is in this context that though there are notable differences in starting an e-commerce business compared with starting a brick-and-mortar business — there are also a number of similarities.
Here are some steps to set up an e-commerce business
Step 1: Find out your space or target customers or better find a niche space to operate
Imagine you are starting a restaurant and looking into different locations, food options, and concepts, you’ll want to investigate the e-commerce area you’re interested in and make some decisions with regard to your specific business. When you do this, the simple rule is look at what customers are looking at and which pain area are you trying to address? Even someone in an IT distribution space looking to venture out in the e-commerce space should know the area in which they are trying to address, whether it is peripherals, or storage or consumables. The idea of differentiation will be the value addition that you bring on the table.
Additionally, the other aspects that you need to look at is – sourcing products and services, the costs involved, legal and other regulations that govern your business. Like any other business, you need to have a clear business plan with specific goals and your plan of action.
Though e-commerce looks attractive, it is also an arena where you will face competition.
Step 2: What’s in a name – select a good business name, which could help in building the character of the brand and choose a legal structure
Once you’ve frozen the plan for your e-commerce business, the next step is to choose a name. The name should be unique, but also clearly indicate what your business is into. It is also better to check domain availability preferably with a dot com.
Step 3: Check out for compliances
Next, you’ll want to apply for a separate identity – PAN and other legal and tax compliances that are required for the business.
Step 4: Get the necessary bank accounts and commercial compliances
You need to register your business and also check out if there are any legal or tax hurdles that do not allow you to do the business even in the web world.
For example, you may start a food business from your home, but the housing society would have some restrictions with regards to operating a commercial business from home specifically looking at fire safety and food license norms.
Step 5: Creating the e-commerce website and the platform
Once you have done your home-work right, instead of searching for a location and preparing to set up a physical store, you’ll create your website and online store.
Your website will be the face of your business — it’s what your customers will see first and what they’ll use to navigate and purchases your products or services. So your website, will be the most important element on the way you do your business.
- Most significant decision will be choosing an e-commerce platform like Shopify, or an open-source platform, like Magento,
- Most e-commerce platforms you can also customize your design, add your domain (or purchase one), manage inventory, take and ship orders, receive payment, and more
- #Shopify– Shopify offers an all-inclusive, user-friendly solution with a variety of add-ons. You can checkout Shopify subscription plans that suit your business
- #WooCommerce –– This plug-in is open-source, free to download and includes the full range of e-commerce features, best if you have a technical mindset
- #Magento –– With this e-commerce platform, you can manipulate all elements with customization– and customize your site — but will need some technical acumen
Step 6: List your products/services
Hooray! Now you have you’ve almost reached the end of the process. You’ll need to source the products you’re going to sell or sell your own products where you list down the catalogue.
Here you need to look at SEO, UX of navigation and focus on the entire moments of truth for customer lifecycle.
Step 7: Market your e-commerce business
Now that you know how to start an e-commerce business, you’ll need to market your e-commerce business.
It could be vide Google ads, social media ads, word of mouth, and more. At the most basic level, you’ll want to optimize your business website for SEO and take advantage of any online marketing tools that are included within your e-commerce platform.
Budgeting of e-commerce business
The most important factor: cost is one which you need to look at before going online. It would be seem simple, but some costs to be taken into account are –
- Cost of the software or e-commerce platform
- Cost of sourcing products
- Compliance and registration for creating the business entity like say LLP, Partnership firm etc.
- Developer fees, hosting fees, add ons
- Domain name and hosting fees
- Payment gateways and set up
- Inventory and shipping charges and logistics
- Marketing and advertising( approx. 6-7% of gross revenue)
- Miscellaneous like—insurance, hardware, employees, consultants, etc
The idea should be when you start, keep it simple, use multiple mediums to canvass about your offerings. Though it is online, make it available in offline mode too. Also though you have a dedicated platform, it is good to have your presence in established platforms like Amazon and Flipkart, you should never miss a customer who sometimes are married to a platform.