YOUR GUIDE TO STARTING YOUR OWN E-COMMERCE BUSINESS:-
If you are reading this then definitely you have already made up your mind on starting your e-commerce business, E-commerce can be very profitable if done wisely. You must understand that starting any business is not easy so before starting any business one should read business books as these books will help you to get new ideas in managing your business in a better way. Going through this guide you can start your e-Commerce business easily.
ULTIMATE GUIDE TO STARTING AN E-COMMERCE BUSINESS
Chapter 1: Growth of e-Commerce in India?
Chapter 2: How to select products for your e-Commerce Business?
Chapter 4: Legal formalities for starting an e-Commerce Business
Chapter 5: Type of Online Store you should choose
Chapter 6: How to get Payment Gateway
Chapter 7: Market Place Vs Own Place
Chapter 8: Platforms for opening your own store
Pros & Cons of Non Hosted Software
HOW CAN START AN E-COMMERCE BUSINESS?
Growth of e-Commerce in India?
E-commerce is growing day by day in the past few years commerce all over the world has gone to another level, the Indian E-commerce market has grown from $6.3 billion in 20011 to $12.4 billion in 2015.
Electronics and apparel are the most sold goods online, the demand for international good has also increased a lot.
Sale of luxury goods like jewelry has also increased, it is expected by retailers that this is 20% sale will be online. It is right to think that in coming days e-commerce will take away some percentage of traditional market customers too.
Image source: www.business2community.com

HOW TO SELECT PRODUCTS FOR YOUR E-COMMERCE BUSINESS?
If you don’t have some awesome product which you already have setup for, you must first understand what kind of product you would like to deal in.
It is important to understand the trends of the e-commerce market, you must do thorough research on what products are sold most online.
Choose the product you can relate to, you must have all the knowledge of the product you are selling.
Image source: seller.trunkroute.com
If you are thinking to go for e-commerce you must know about the products which are sold most online. Here is the list of top 5 things sold in India:
- Fashion products – with the daily changing fashion people now prefer to check it regularly online rather than going to market every week.
- Books – books are one of the most sold products online, their cheap prices and easy availability is a big plus for them.
- Beauty products – skin care products are frequently bought online, Indian brands like Nykaa, Purplle,etc.
- Video games – both computer and computer video games are hugely bought online.
- Artificial jewelry – jewelry is the ultimate love of the Indian women, due to this love it is seen that every 5 minutes a jewelry piece is sold online.
CHOOSE A NAME
You need to choose a unique name for your brand and product which are easily recallable and easy to spell. It has become very difficult to find a good domain name these days. You need to choose a unique name so that your product does not get mixed up.
LEGAL FORMALITIES FOR STARTING AN E-COMMERCE BUSINESS
To start and e-commerce business there are certain legal aspects which you need to fulfill. You need to start your e-commerce business have following registrations to
A business can be operated as:
Sole Proprietorship – it means a single person is the owner of the entire firm and is responsible for its working. It is easy to start and easy to access. It is recommended for startups who want to have a headset first. Liability is unlimited in Sole Proprietorship.
Partnership firm – It is same as proprietorship firm as a feature but its need 2 persons. In the partnership firm liability is the unlimited same as a sole proprietorship. A registered partnership deed is required.
Private Limited Company – Private limited company is the major business formation for the startups and from 2015 it is very simple to register a private limited company with INC 29 Form and there is no requirement of minimum capital. Minimum 2 directors are required to register a private limited company, the liability is limited.
Limited Liability Partnership – It’s a mixture of Private Limited Company and Partnership firm. A limited liability partnership (LLP) is a partnership in which some or all partners (depending on the jurisdiction) have limited liabilities. In an LLP, one partner is not responsible or liable for another partner’s misconduct or negligence. It requires minimum 2 partners and a minimum capital of 1 lac rs.
TO START YOUR e-COMMERCE BUSINESS
If you wish to start an e-commerce business it is best to start as a company, it increases your scope for getting funding.
Image source: blog.exitbee.com
Service tax registration – You must have a VAT registration for opening a business in e-commerce. It is compulsory to have a VAT registration for any in selling or buying in India. It can be obtained from the State’s Sales Tax department.
If you are not a Sole Proprietorship, then you need to obtain permanent account number (PAN) of the entity.
Every entity has to obtain a tax deduction account number (TAN) and tax identification number (TIN) along with VAT.
However, I would suggest, that you consult a legal expert to understand what all your require for starting an e-Commerce Business.
Bank Account – once you have registered your company, you need to open an account in your company’s name. In the case of a proprietorship, you need to obtain VAT certificate first to open a bank account. It is necessary to open a bank account in e-commerce for you to obtain a payment gateway.
HOW TO GET A PAYMENT GATEWAY?
E-Commerce is growing day by day, more people are shifting towards online shopping. Old just cash on delivery payment style is slowly-slowly being replaced by most of the people, people now days prefer to pay through credit card, debit card or internet banking. It is essential for an e-commerce website to have a good gateway payment service.
Image source: blazedream.com
Prior getting payment gateway for the website, you must incorporate your business entity first.
There are two types of payment gateways in India –
1.) Payment gateways with no setup fees: these are very popular but they have higher TDR’s (Transaction rates) per transaction. Few examples are PayPal, Payumoney, Airpay etc.
2.) Payment gateways with setup fees: these have lesser TDR’s per transaction and faster processing. Few examples are Payu, ccavenue, directpay.
For applying for a payment gateway in India you will be required to submit few documents, like ID proofs, phone bills etc. They verify your address also. It takes approximately 10-15 days for the completion procedure.
If you want to know how to choose perfect payment gateway you can read the blog Guide to Choose the Best Payment Gateway for your e-commerce site
WHAT TYPE OF ONLINE STORE YOU SHOULD CHOOSE:
You need to have an online store for selling your products, there are two ways of selling the product.
- You can sell in marketplace like Flipkart, Amazon, Aliexpress, Paytm etc.
- You can build your own store.
Marketplace vs. Own Store
Both the options have their pros and cons, it is up to you which medium you choose.
If you are a startup with limited resources, you should go for marketplace as they have big investments and infrastructure; you don’t need a big man power if you sell through them they take care of support and other stuff.
This gives you time to make upcoming strategies and just focus on your production and management. You can just upload the product and they will take care of advertising it.
Your own store helps you build a Brand, you need not worry of getting lost with many merchants like in marketplace. You get the full control of our marketing, inventory and user experience.
The best option is to be a hybrid, ‘Multi-channel Retailing’- Build your own store and get more customers and orders via a marketplace.
Build your own store
Image source: masscothosting.com
To build your own store you need an e-commerce platform. What is e-commerce platform- it is a software technology solution that allows you to build storefronts (a storefront is any customer or business facing proposition relating to the selling of products and services) eCommerce Platform.
If you have big tech team who can easily do developing work go for non-hosted software to build your shop. WooCommerce can be a good option. Non-hosted platforms cost less and helps you with full customisation power.
If you don’t have developers and are not very good in coding you should go for hosted platforms. Hosted platforms have their limitation but they make managing your store easy for you.
Further, you should customize your online store so as to reflect the real company. This means, the logo, colour schemes should be in complete co-ordination. This is not necessary when your only public interface is your online store.
It is important that your website is mobile friendly, today a big percentage of users are shopping through their mobile phones. Your website should be easy to download.
MARKET PLACE V/S OWN STORE
Once you have decided that you want to sell online, it means that you understand the opportunities and challenges you are going to face. E-commerce is growing day by day and this means more and more people are buying online but it also means that more people are selling online too
Having a product is basic step and selling is the major step. The big question here is where and how to sell. You have two options to sell.
Either you can turn to the marketplace or sell in own place.
Both options have their pros and cons it is you who need to decide what is better in your situation.
Marketplace- Platforms like Amazon, Flipkart, and Snapdeal allow the seller to come and sell their products on their website.
Pros of Marketplace
- More potential to reach customers- marketplace has already achieved what you are seeking for, they have a large online presence and already million of traffic. When selling at marketplace you get the benefit of this fact and this means more sales opportunity for you.
- Big infrastructure- Marketplace already has big investments and infrastructure. If you are a startup or have budget issues it is best to go for selling in the marketplace, you just need to register and upload product and they will then take care of your marketing and management.
- Trust factor- everyone likes to buy from known source, no one goes for random. You can enjoy the goodwill of the marketplace and can increase your sales.
- Quick selling- if you go for setting your own store you will have to wait for people to come to you which can take months but in marketplace, you can start selling within a week of registering.
Cons of Marketplace
- Getting lost in the crowd– there are lot people selling the same kind of products at the same place, means you have to face a lot of competition. These websites like Amazon and Flipkart have their own products also which they promote so you can most likely get lost in the crowd sometimes.
- Branding is not possible– when you sell a product on the marketplace the customer does not remember you selling them remember Amazon or Flipkart selling them the product. Your personal branding is not possible there. Yes, there is the possibility of searching by brand but it becomes difficult to promote your brand when a same product is sold by so many people.
- No customer gaining– some marketplace website does not let you have the information of the customers. They just inform you regarding the order of product and take it from you after you are ready for dispatch. You don’t get customer acquisition in these places.
Own Store: From the name itself it is clarified that it is totally yours, your store, your own brand your baby. You can build up your own store and sell your products on your terms.
Pros of your own store
- Full control– when you build your own store you have full authority of marketing, advertising, and customization of your brand. This is your opportunity to attract customers toward you, be as creative as you can be. You can show what you want to show the customer.
- Customer acquisition- It’s your website and brand a customer is coming too so you get their full information. You can use the information for your analysis and can make strategies of targeting customers again.
Cons of your own store
- Expensive process– managing a website is a difficult task, either you should be a web developer or you hire someone as it is not simple task t do coding if you don’t know the field. You need to invest a lot of money to build up your own brand.
- Time to market– it can take a lot of time for you to build a famous brand, you will have to face a lot of competition to come up in google rankings.
PLATFORMS FOR OPENING YOUR OWN ONLINE STORE
What is e-commerce platform- it is a software technology solution that allows you to build storefronts (a storefront is any customer or business facing proposition relating to the selling of products and services) E-Commerce Platform.
There are two types of platforms-
- Hosted software- hosted software is a software installed and managed through a remote server. It is managed by third-party and can be accessed globally by the users. Here everything is already built and can be suited to your requirement. Eg: Shopify
- Non-Hosted software- It is a software that lies and rests with you only, where you are yourself responsible for all managing all the hardware and software. There are no limitations to design and development. Eg: Your own Website hosted on your own hired server
Pros of Hosted software
- Easy to use- setting up your own store on hosted software is very easy.>
- Technical support- you don’t need to worry about extra technical issues like bug fixing, downtime, and quality control. The software handles these issues for you.
- Cost effective- to maintain a hosted solution you don’t need to hire an expensive IT team. What you need instead are tech-savy employees that know their way around the web and understand your target audience. Essentially they’ll need to create and keep your website content updated. The daily concerns will be around static content, images, enabling/disabling products, install and configure new modules and customer support.
Cons of Hosted software
- Limited customization- you don’t have full control to coding so the customization of the website can be limited, it can sometimes irritate you in customizing.
- Transaction fees- be careful before signing transaction fees, it can be a trouble to you in long runs if your margins are low.
- Going global- if you plan on opening your store globally in different languages, it can be a problem on hosted software. Hosted software does not work properly with multi-country stores.
- Ownership issues- you open your own store with the sole purpose of having all rights, but this cannot be possible with hosted software rules can change and you don’t have much say there.
Pro & Cons of Non-hosted software
Let’s understand what are you going to face when you go for non-hosted software
- High set up cost- you will need to invest a lot in starting few months for launching and development of products. You will have to higher big tech team for managing the technicalities.
- Configuration: Your team will need to configure web servers, maintain Linux packages, manage servers load, and their availability, maintaining your databases, manage their replication, backups, recovery, etc. It’s a very long list that needs a set of experienced hands taking good care of it every day. Make sure you have a technical co-founder or some senior developer you trust to guide you along this sometimes bumpy road.
- Set up and monitoring- you will need to monitoring tools to keep the track of system continuously. It includes monitoring the framework and check the system stays healthy for customer usage.
Security- you need to ensure the security of your website, it is you who will be responsible if any fraud occurs due to breach in security.
E-COMMERCE LOGISTICS IN INDIA
Once you are done with setting up everything and about to start business, you must remember you will need a courier service for transportation of your goods. They must have a great network all over India and even abroad bluedart, aramex, fedex or you can talk to automatic logistics solution providers in India for e-commerce. You can take their Currier rates, taxes and delivery time, and compare. They may request you for an agreement signing, in which you can ask them for monthly billing, so that it becomes easy for you.

After studying about all the options available for creating online store I feel it is better to go for hybrid option i.e. you can build your own store as well as sell in the marketplace too.
By doing so it ensures that when you are in early steps of setting up your own store you don’t have to wait for long in getting revenues, you can start earning through the marketplace and focus on building brand too.
Comments (9)
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After establishing an eCommerce business Logistics plays a crucial role to make it successful.
The main role of logistics is to provide timely and efficient delivery of products so that the customer is satisfied and becomes your repeat customer, and also earns you more customers.
When starting an eCommerce business, you need to make sure that the total cost of ownership must not drain out all your earnings and profits in the future.
Well with WordPress you can easily start an e-commerce business and launch a web store for free. If you know how to work with WordPress there are many free themes and plugins you can use to do it.
Thank You Denise 🙂
Yes WordPress is a good option 🙂