The cost of setting up and running an online store is made up of many factors, including additional services that you may not be aware of when planning online sales.
What expenses would you have to make?
In this guide, I am going to look at the approximate costs of all the components needed to open your online store. The idea of creating an e-commerce business in the form of an online store is no longer innovative.
E-commerce has become mainstream, and being online is commonplace and often mandatory. But I’m guessing you already know all this. What’s more, you probably already have a product or service.
Now it’s time to choose the right tools that will allow you to sell online. To make the best choice, you naturally need to know how much the solutions cost and what options you have.
Every successful e-commerce project must have an estimated budget, and this also applies to your future online store.
Answer the question, “how much does it cost to create an online store?”. It is not easy. It all depends on what your needs and expectations are. But I will try to help you find the answer.
Surely you know the saying that nothing in life is free. It is possible to open an online store for zero dollars, although it will be so limited that you will eventually buy additional options or a premium version. This type of offer is a typical customer acquisition model for higher price plates, not an act of charity.
To find platforms with free online stores, type “free online store” into Google, and you’ll see tons of results. They work, but you’ll quickly run out of the capabilities of the free version of the online store platform and will be forced to switch to the premium plan anyway. Sometimes it’s a trap to attract customers.
Therefore, an online store is never free; it always costs a lot of sacrifices to the owner. Don’t put too much hope or far-reaching development plans into this option. If you are serious about the e-commerce business and owning an online store that makes real money, you will probably realize that you have to pay for some things.
An e-commerce store in the subscription version (the SaaS model) due to the low entry threshold is an attractive solution. You can buy and launch the basic version of an online store based on an e-commerce platform for a dozen dollars a month, although the prices of higher packages can also reach several hundred.
Of course, these solutions are not without flaws. Ease of implementation is undoubtedly one of the cardinal advantages of this type of solution. They offer a ready-made look and feel for an online store, which is both an advantage because you don’t have to worry about the visual aspect, and a disadvantage because the possibility of customization is limited. You don’t need technical knowledge because the platforms are usually easy to set up.
Remember that you only buy access to the system from the service provider. You cannot influence the development of functionality within a given platform. And as soon as you stop paying, the whole store you have built will disappear. Very often irretrievably.
It is not a scalable option, has many limitations, and I do not recommend it to most eCommerce entrepreneurs. If you have a limited budget and you are a beginner, you may be very tempted, but analyze in detail if it will be a good solution for you. However, it may be better to spend a little more time at the beginning and create a store that allows you full customization, offers you opportunities for future development and the freedom to transfer it to another service provider.
You can choose one of the three most popular solutions for an online store. Check in another article which script will be the best for you: WooCommerce, PrestaShop or Magento? I have listed them in order from the simplest to the most advanced.
Although all these CMS (WooCommerce is a plugin for WordPress) are free and open source, only WooCommerce can be free for a person without much programming knowledge. PrestaShop is the most popular platform among professional online stores. Magento, on the other hand, is the most complicated solution; it is the best choice for larger e-commerce stores.
I will not give you a specific cost to create your store because it depends on your needs. You can create your store based on free WooCommerce themes and free plugins. The design cost will be $0, and you can do it even if you don’t know languages.
If you have a specific vision for your store and no knowledge of PHP, CSS or HTML, then creating a simple but customized store will cost you between $500 and $3000. More advanced solutions will have higher costs associated with them. An advanced PrestaShop store can cost several thousand dollars. A professional and colossal online megastore based on Magento can cost tens of thousands of dollars.
Unless you want to buy a prestige domain from someone else (for example, 3377.com for $100,000), your domain will cost you between $5 (.xyz) and $72 (.io) per year. A .com domain costs $13 per year.
Beware of promotions because some companies offer discounts or even a free domain for the first year, however, the renewal price after that is much higher, as well as the domain transfer price. If you are building a real business, calculate the cost of the domain over five years, also looking at the renewal price.
An e-commerce store must have an SSL certificate. No customer will enter his data if he is not sure that the connection is encrypted. There are different types, but Let’s Encrypt will suffice. The simple SSL certificate is free as long as you use a reliable hosting provider.
To save you time, I am going to recommend you the best eCommerce hosting. You will find it in OpenZone’s offer. In addition to the parameters I have already listed, you will receive 24/7 support provided by experts. The best eCommerce hosting on the market.
If you want to run an eCommerce business, definitely forget about the cheapest shared hosting packages. They are absolutely unsuitable for commercial activity. The cheapest eCommerce package for small stores is $31.32 per month. However, if 16 CPU core, 59.2 GHz , 16 GB of RAM and 40 GB on a NVMe SSD drive are not enough for you, choose a higher package. The higher, the more expensive.
A professional e-commerce store will require hosting with at least 4 GB of RAM, which is about €9 per month. If you are going to build a huge platform, you may even need specialized hosting for $258.12 per month.
What is crucial when choosing an e-commerce hosting is the compatibility with the selected scripts. It is not only about the possibility to install the script with a click, but also about additional solutions: plugins, templates, hosting panel linked to the CMS panel and optimization for a certain platform. You should also pay attention to NVMe SSD drives, because the speed of loading files depends on them. After all, your store needs to run fast and smoothly. Also, pay close attention to the security and uptime of the hosting.
Your multivendor e-commerce platform should be complemented with a blog or a comprehensive knowledge base. It is necessary to achieve a high position in the search engine because, without high quality content, your website will not achieve good SEO results. And good content means not only SEO support, but also the possibility to perform content marketing, increase conversion and build customer loyalty.
You should also take care of the original descriptions. By copying standard descriptions that other online stores use for the same products, you duplicate content. You will neither sell nor rank.
Now the question: do you know how to write? If you can and are willing to dedicate your time, you can create a blog and original descriptions for free. But if you are not a master of the keyboard or don’t have the time, you will have to hire a copywriter. On freelancer websites, you can find daredevils who will write an article for $10. If you’re looking for a professional copywriter, you’ll have to be prepared to pay more: between $30 and $100 per article.
It would be good to start writing product descriptions and 20 articles for SEO, which can range from $400 to several thousand dollars, and then publish 6 to 10 articles per month (the cost will be $60 to $500).
You need a payment gateway to receive payments. The choice depends on the payment methods you want to offer and the country you reside in. If you plan to offer local services, you will need local currency; in this case, look for local payment gateways as well. If your e-commerce store is intended to be international, look for gateways that offer the possibility to pay in different currencies.
The most popular payment methods are bank transfer, debit or credit card, fintech apps, Paypal and Bitcoin. In addition, you can consider applying for a credit card to further expand your payment options.
Registration and setup for most payment gateways are free, and transaction fees are charged per transaction. For example, Braintree costs between 2.59% + $0.49 and 4.59% + $0.49, and Authorize.net charges similar fees. Skrill may be cheaper (some payment methods are free, but it depends on the country). Another popular solution is Stripe. However, make the exact choice of payment gateway depending on your situation.
If you want to accept Bitcoin, you should use a separate payment gateway. The big advantage of accepting Bitcoin transactions is the absence of transaction fees (or very low fees). Completely free solutions are Blockonomics, BTCPay, CopPay and AnyPay, while commercial solutions (0.1% to 0.5% commission) are CoinPayments, Binance Pay and Zonda Pay.
You cannot forget about legal issues. When creating and managing your online store, you should be aware of many laws in areas such as copyright law, financial law, banking law and regulations related to business activity. You should have appropriate documents on your website that regulate the services you provide, the acceptance of payments and the processing of personal data. Be aware of where you will operate your store and adapt your regulations accordingly.
Some copy the terms and conditions and legal notices from other sites, but this is not the best solution. It is a huge risk because these regulations apply to a particular company operating in a particular area and based in a particular location.
If you want to operate internationally, the best thing to do is to adapt your website to US and EU law. In this way, your website is likely to comply with the regulations of most countries in the world. The cost of preparing the necessary documents can range from $50 to $1,000, and in the case of larger, more complex and extensive businesses on a larger scale, even more.
So, as you can see, the cost of setting up an online store varies a lot. If you want to set up a small store and can dedicate your time to it, choose WordPress with WooCommerce, create the content yourself, spend time configuring and editing the template yourself, search for and install plugins and seek free legal advice on the Internet. After that, the only fixed cost will be the domain and hosting, which will cost approximately $116.64 per year.
In addition, you will pay a commission to the payment operator. It may be that the only payment methods for your store will be cash, bank transfer and Bitcoin.
The costs increase depending on your needs: from purchasing premium plugins and themes, to additional functionalities on your website, commissioning copywriting, preparing legal contracts, better hosting, or even designing a dedicated store for you in PrestaShop or Magento. The upper limit is set by your needs: it can be several or even tens of thousands of dollars.
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