What is needed to start E Commerce Website? And how much it will cost you?

This is in continuation to we discussed about what is eCommerce and this article will be help you with the list of things you should be aware of before you decide to launch an eCommerce website for your products/service.

eCommerce is not like any other website you see online, it has different feature and different way of presenting stuff. These website are used mainly to sell products or service so from a catlog page to a shopping cart everything has to fit in the shopping flow for a customer who is visiting your eCommerce website. Below are some of the thing which are needed specifically to build a shopping site. 

Start an eCommerce website

1. Domain name

   Of course everything online starts with a web address. Choose appropriate name for your website which will describe what you are into or your core values. You can add eCommerce capability to your existing websites too. Buying a domain name will cost you 500 – 1500 /year

2. Hosting

   You can check out Things-to-know-before-hosting-your-website, apart from 8 important things mentioned on this article you need to take care that the hosting server which you are choosing will be compatible with shopping cart software. Costs range  2000 to  5000/year

3. Shopping Cart Software

   This is a software which can be bought(one time fee) or on a subscription model from the hosting provider (monthly/annual fee). What this software does is allows online shopping customers to accumulate a list of items for purchase, described as “placing items in the shopping cart” or “adding to cart”. Upon checkout, the software calculates a total for the order, including shipping and handling (i.e. postage and packing) charges and the associated taxes, as applicable.

   Shopping Cart Software is also known as e-commerce software, e-store software, online store software or storefront software and online shop. Check out the comparison of shopping cart software here. There are many free software available if you are willing to invest some time and learn about how to go about these software.But usually Costs  500 to  5000 monthly.

4. Payment Gateway

   You have to establish a method to receive online payments from you customers and there are many service providers for these. All providers charges you a setup fee and a commission on each transaction ranging from 2-7% of the total amount. Payment gateway establish a way for the customer to transfer the bill amount through their net banking/credit card/debit cards. Set cost ranges from minimum of  6000 (payu.in) to max  25000 one time non-refundable and plus 2-7% Transactional fee, plus annual maintenance cost  1000- 4000/year

5. Shipping and logistics

   This the final process of your online sales where you have to deliver the products ordered online by your customers. There are many courier and shipping companies with which you can have a tie up for bulk order and get a better discount. Not all the courier company have reach to all the places in the country so you have plan this one properly and update you online commitment accordingly (i.e delivery time frame mentioned on the website). Charges depends on the total weight of the shipments. Ranges  25-  50 for minimum or 500 gm of courier.

So considering all the above stuff the minimum expense to setup an eCommerce site will be  4000 –  16000/year and a fixed cost of  6000 for payment gateway. This all is apart from the web designing charges that you will have to give to web developer if you have no idea how to set up a website.

Easy Option to host eCommerce site

Apart from all this you have another option of taking a hosted eCommerce platform provided by many companies where in they will charge you monthly or annually and gives you all the services mentioned above in specific plans that they offer. Examples: http://www.buildabazaar.com, http://www.zepo.in, http://shopable.in/

But cost may come more compared to you setting everything yourself, but surely until you are clear with and want to see how your store performs, this will be the best option to go for testing your product as well as your market.

Cost range –  12000 –  25000/year.

A detailed comparison between above two will follow in next article. Stay tuned!

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