How to Start E-Commerce Business : A Step-by-Step Guide

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 How to Start E-Commerce Business : A Step-by-Step Guide

How to Start E-Commerce Business : A Step-by-Step Guide

A place that allows customers to purchase and advertise physical goods, facilities, and digital assets over the web rather than in a brick and mortar store is a virtual e-commerce system. A business can use an e-commerce internet site to process transactions, collect payments, manage shipments and logistics, as well as provide customer support.

The term "e-commerce" plainly refers to the online sale of goods and services. In the most basic form, an E-commerce marketplace involves the automated transfer of funds and data among 2 or more entities. Since its original conception in the 1960s with electronic data exchange and the advent of internet shopping and online purchases in the 1990s, this type of business has now evolved significantly over time.

The proliferation of smartphones, which allow users to compare and shop from almost anywhere, has given e-commerce software and technology a significant boost in recent years. Moreover, online businesses have predicted that, following the 2020s, e-commerce will surpass $248 billion.

Introduction to E-commerce

Electronic commerce (e-commerce) is a business framework that enables companies and individuals to resell goods and services on the internet. E-commerce, also known as conducted electronically on the internet, refers to buying and sale of goods or services over the web, as well as the movement of funds and data to complete these transaction records. 

E-commerce is frequently used to refer to the online seller of physical products. Still, it could also refer to any type of commercial transfer of funds that is facilitated by the internet. Four major types of e-commerce models can describe almost every transaction that occurs between businesses and consumers; we will discuss these below, together with the steps for establishing your online store.

Types of E-commerce Models

The majority of e-commerce occurs on an e-commerce website, which serves as a virtual storefront where transactions, as well as commerce, can take place. These e-commerce model can manifest in a variety of ways:

Crowdfunding: Customers pool their money, often ahead of the release of a new product, to raise venture funding, leverage purchasing power, minimize production costs, and so on.

Digital Products: Most people think of tangible goods, but so many e-commerce exchanges include the sale of digital goods (such as songs, movies, video and audio, frameworks, software, and so forth.)

Dropshipping: Products are marketed online, but they are dispatched directly to customers by a third party that handles inventory, order fulfillment, and other logistics.

Retail: Businesses sell products directly to the end-users without the involvement of any intermediary.

Subscription: Until the registered user cancels or changes their subscription level, recurring buying for goods or services is digitalized.

Services: Labor force or services can be acquired digitally, such as employing an Uber driver or reimbursing someone to run your tasks online.

Wholesale: Products are marketed in bulk, either to consumers directly or to wholesalers or distributors.

Types of E-commerce companies 

E-commerce online sites, like conventional physical retail stores, allow businesses and consumers to buy and sell to each other on a dedicated online platform. The main distinction between e-commerce and trade or commerce in its physical form is that e-commerce processes are running entirely on the web rather than in a geographical place, which gives rise to Various e-commerce sites.

While looking at e-commerce businesses, we usually see one to two of the four different types of e-business, obviously depending on who is buying and who is trying to sell. Like all decent functions of a business, they can be boiled down to three-character abbreviations. These types of e-commerce businesses are defined as follows:

Business-to-consumer (B2C)

A B2C site is probably one of the most familiar to ordinary people. It allows for the exchange of goods and services among a business and even a consumer, such as purchasing any item from your favorite web store.

Business-to-business (B2B)

A business-to-business (B2B) system enables electronic transactions between different companies. For instance, if you happen to own a business that sells customized mugs, you might purchase those mugs from an online distribution company.

Business-to-administration (B2A)

A B2A website, for example, facilitates the electronic exchange of goods and services between an establishment and a public body, such as the website of a company that developed the city's web interface.

Consumer-to-consumer (C2C)

A C2C website, also known as a consumer marketplace, facilitates the exchange of goods among two or more consumers. Websites such as Etsy and eBay are C2C examples in e-commerce or the system of e-commerce.

Consumer-to-business (C2B)

Individuals sell services or goods to businesses on a C2B e-commerce website. This could be a commercial photographer, an SEO expert who works with companies in a specific industry, or perhaps an influencer who is compensated to promote a company and its products.

Consumer-to-administration (C2A)

This kind of site, roughly comparable to B2A, allows the consumer to provide relevant data, goods, or assistance to government administration and government organizations. For example, when you are paying a parking permit through your city's web interface.

What is Multi-vendor E-commerce?

multi-vendor e-commerce webpage or store, as the name implies, is a framework for third-party vendors to purchase in one location. In layman's terms, it's a large store that houses a number of small shops run by independent sellers.

Consider it a mall (operated by you) that needs to deliver to people's property to make it much more approachable. As the notion suggests, your mall contains a large number of small shops. 

The independent shop owner is responsible for running each multi-vendor e-commerce shop. Still, you bear the greater burden of storing goods, delivering those to people's homes, and receiving money. Consider this shopping center in an online E-commerce setting. 

Your mall transforms into a marketplace, the local stores become seller's warehouses, and you are in charge of customer orders, shipping, and pay-outs, which is an example of a multi-vendor E-commerce website or online global market.

Open source E-commerce

An open-source e-commerce platform or portal provides a flexible and dynamic framework for attempting to launch an e-commerce store. Still, they also contribute to an online marketplace's total cost of ownership (TCO). Hence, open-source e-commerce is a viable option if you want to gravitate toward this niche.

Where should you sell your goods?

Selling the products online has several benefits, including reaching a broader audience, who may transform into your customers, no requisite for setting up a physical store. Listing the goods on the marketplace is much easier than creating a custom e-commerce retail outlet. When it comes to selling your online order, you have two options: list it on a marketplace or build a custom e-commerce. 

MarketplaceMarketplaces are a third-party framework and a ready-to-sell store in which you can list the item and begin receiving buyers for your products. It is pretty simple, and there are always benefits and drawbacks to it. Listing your goods in the marketplace will not get you, buyers right away; you must compete with other merchants. You must understand the global market algorithms in order to rank your item at the top and receive user reviews, which build trust. 

  • Create Your Own E-commerce Platform

Building one's own custom e-commerce can provide a significant long-term return, but it requires a considerable amount of effort. You have to hire a group to build your website and a marketing company to help you with advertising, promotions, and strict and efficient SEO. Setting up one's own e-commerce platform takes time, but it helps build the brand image, develop a solid customer base, and collect user data. These, on the other hand, are not possible when selling your goods on an e-commerce platform.

Steps to start and scale E-commerce business

Modern technology makes it much simpler than ever before to open an online store. There is a platform to produce positive outcomes, whether you are a side hustler or a serious vendor. So, what must your objective be? What kind of -E-commerce company do you want to start? You should think about some things before deciding how to start your e-commerce store.

Select Your Niche

The first stage at the beginning of a new e-commerce or e-business is conducting research and collecting data. You'll want to start investigating the e-commerce region you're willing to take part in and make some serious decisions about your selected industry, just as you would if you were beginning a cafe and looking into multiple places, dining options, and their themes.

For instance, you must think about what your e-commerce business will offer. If you plan to sell products and services, or if you want to sell the products, will they be digital or tangible? You should take into account how you will obtain your products. 

Along these boundaries, you want to consider the kinds of business models in e-commerce you want to use; if you wish to offer single items, bundles, subscription services, or something else, all of this must be decided when choosing a niche.

Go Through successful websites related to your niche

You'll also like to think on a larger scale throughout this process and consider a few research questions about providing your services to the target consumer base and so on. These tracks of questioning, among many others, will be essential to the start-up of your business and will assist you in designing, implementing, and writing your marketing strategy.

This procedure will help you better understand your concrete objectives and how you intend to achieve them. Discovering your niche is an essential part of this step, especially in the e-commerce environment. Although the expansion of the e-commerce industry is beneficial to those seeking to know how to start an e-commerce business, it also creates more competition.

You also want to conduct competitor research to identify a market in which you believe you can create your brand and sell a product or service successfully.

Decide on your Business Name 

After you've decided on a signature title for your e-commerce venture, the very next step is to come up with one. As with any other business, you want to choose a name that is distinct while also clearly indicating what your company is or does. You should probably check the website of the state's secretary of state. To make certain that you aren't selecting a brand name that another company has already claimed, check with the U.S. Patent as well as the Trademark Office.

Even though you probably don't want to spend too much time on a website just yet, it's worth checking to see if your possible business domain requirements meet. If your domain name is already in use, you may want to consider an alternative business address or a different design. 

Select a Structure for your Business

Next, decide on a legal structure for the company. The type of business you choose will have significant legal and financial ramifications for your e-commerce process. In most cases, you'll establish a sole proprietorship, partnership agreement, limited liability company (LLC), or corporate entity. Each of these entity types has advantages and disadvantages, so you may want to seek the advice of an attorney or perhaps another legal professional for tips on the best alternative for your business.

If you choose to form a sole proprietorship or partnership agreement, you will not be required to be legally registered in the state in which you operate. Instead, your business will be legally affiliated under your personal name, which means that if you want to operate under the name you selected, you'll need to register a DBA implementation with your municipal authorities and also apply for an EIN (Employer Identification Number) for your e-commerce site to control your business and finances.

Apply for Licenses

After obtaining your EIN, you'll need to acquire any business licenses or permits required to operate legitimately in your state and city. As previously stated, if you've formed your e-commerce company as a sole proprietorship or partnership agreement, you don't have to sign up with the state unless you're submitting a DBA to continue operating under a unique business name legally. 

Nevertheless, for the other registered business types, you must register your company with your state and obtain a general license to operate. Based on where your E-commerce company is located, you may also have to obtain a local operating license. 

Since most e-commerce companies are run from home, they do not need as many business licenses as traditional physically-established stores. However, you should find out what the particular guidelines are in the area. 

You can generally find this information online through your state or local website. Most places, for instance, require home-based entrepreneurs to obtain a home occupation permit in order to legally continue operating. This type of authorization shows that running your business from your home does not add traffic or other troublesome conditions to your position.

Create Your Website by choosing a Platform

You've finished the paperwork needed to enter and legally launch your business or learn about e-commerce business how to start. As a result, the majority of the steps thus far have reflected the process of launching a traditional business. Instead of looking for a place and planning to open your physical shop, you will now start working on your website or online store.

This website, like a physical shop, will become the face of your company, and it will be the very first thing your consumers see and will be utilized to browse and purchase your products and services. Keeping this in mind, developing your webpage will be one of the most crucial components of launching your e-commerce venture.

As previously mentioned, you would want to consider your domain name first. You'll like to have your web address (at the very least) be similar to your company name. Along these lines, and most importantly, you will need to select an e-commerce framework. Your e-commerce framework, whether an all-in-one operating system like Shopee (perbedaan E-commerce dan marketplace) or a public network like Woocommerce, will be the foundation on which you build and create your online store.

How to get Organic Traffic to your Blog website or E-commerce website?

Work on your Marketing Strategy

You're ready to begin serving the public now that you've prepared the products or services and listed them on your online marketplace and your website is fully operational. Of course, you'll have to commercialize your e-commerce business in order to achieve this properly.

You can use a variety of marketing strategies, including Online ads, online Google ads, brand awareness, and more. At the most basic stage, you should maximize your online business for SEO and use any digital marketing tools that come with your e-commerce forum. As the e-commerce business grows and orders begin to come in, you want to keep a record of which marketing techniques are working and which don't, primarily if you're investing the money in them. You will be capable of adjusting and changing your marketing approach as time goes on to find out what works for your company.


There is always much that goes into setting up an online retail business. The process may appear to be a daunting task, but you'll get there! Work around all of this step by step, but don't worry about getting everything perfect right away. Gain knowledge by doing and adapting along the way. With maybe a little time and experience, you'll be able to run a profitable company and thrive in the world, and you'll be grateful for the achievement.


  1. Is E-commerce a promising career?

The e-Commerce industry is gaining momentum right now, and everyone wants in: shareholders, retailers, and, of course, job applicants. The e-Commerce industry also has a plethora of excellent employment opportunities that should not be overlooked. It is the fastest-growing sector, accounting for more than $1 trillion of the global total, and is anticipated to further rise at a rate of 17% year after year. 

2.Does E-commerce provide good placements and work opportunities?

It can be said quite plainly that the industry promises a steady increase in wages and job opportunities. Starting to work in e-Commerce introduces you to all elements of the company. Marketing, setting prices, supply chain logistics, service and support, and customer acquisition are just a few examples. 

In other industry sectors, managers are in charge of these responsibilities. Even though they handle the majority of the items on the list of categories of e-commerce, they are fortunate.

3.Do you need a license for E-commerce in India?

Before selling online in nearly every state, sellers must obtain a license. In a broad sense, if you sell sales tax-exempt goods or services, you should indeed obtain a seller's permit for different types of e-commerce in order to pick up taxes from clients and purchase goods from suppliers without needing to pay sales taxes on the purchases. 

4.What licenses do you need to run your E-commerce Site?

To successfully advertise your products in India through the list of e-commerce platforms, you will need the following documents:

  • Terms of Service: The Terms of Service Document would include the e-commerce goals of a company- its goal, vision, and objectives.
  • Privacy Policy: The Privacy Policy document describes how the company will handle the user's, visitor's, or customer's information and other details.
  • Disclaimer Format: A disclaimer format protects the business by exonerating it from any liabilities arising from the information published by any user or third party.
  • Refund, Cancellation, and Refund Policy: The Refund, Cancellation, and Refund Policy cover all conditions pertaining to the customer's product exchange, order return, and order terminations.

5.Can I sell online without a business license in India?

When conducting online businesses, you must keep a current account with the bank in the name of your company. To do so, you must first ensure that your company is a corporate construct. 

To demonstrate this, you must register with the tax department and acquire an establishment permit. It is crucial to have a business permit in order to sell online. In hopes of selling online, you must have a business permit, which is an essential step in establishing your company as legal, valid and legitimate.

6.Is shop and establishment license compulsory for E-commerce?

The primary goal of a Shop Establishment License throughout India is to guarantee regulatory compliance and to improve the working conditions in online shops and commercial establishments. It also focuses on improving and giving employees and worker protections. Salaries, leaves, working time, rest and meal breaks, fatalities, and dismissal are all examples of these privileges.

It is also required for all e-commerce types with examples (as mentioned above) and home-based businesses to have a legitimate Shop and Establishment Registration or Permit. Under the same Act, holders of e-commerce companies, online enterprises, e-commerce portals, and establishments must enroll and obtain a Certificate. The Registration of Shop Establishment License must be acquired in under 30 days of the beginning of the business.

7.Which FSSAI license is required for E-commerce?

With the growth of e-commerce food businesses, the Food Safety and Standards Authority of India (FSSAI) made it compulsory for all e-commerce food manufacturers to acquire FSSAI food permits for their global supply chain. As for e-commerce sites, for FSSAI, the central license obtained from the nearest Central Licensing Authority should be collected.


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