How Much Does It Cost to Start an Online Store?
This is one of the most common questions when anyone is starting a new business venture, and for good reason: it’s one of the smartest questions you can ask.
Your budget impacts the majority of your business decisions and planning out your costs as thoroughly as possible is a vital part of your planning. The same is true for building an online store, and this article will help you understand how much it costs to start an online store and how you may be able to lower some of these costs without sacrificing the quality of what you create.
The cost of building an online store is going to vary significantly depending on some of the initial choices you make. It’s extremely important to understand these options and what they mean, both in the long and short term of your new business.
Certain choices that save money in the beginning may end up costing you more in the long run, whether that cost is in dollars or time, or both. The reverse can of course also be true, as a larger investment early could save you thousands (or even more) over the course of your business’s development.
One of the most basic decisions you’ll need to make is whether to use an hosted eCommerce solution or to use open source code to build the store on your own or hire software developers to build it. This decision is easier once you understand a couple of things about this type of software
- There are already many ready-to-use and fully customizable ecommerce platforms available, and one of them is definitely going to serve your specific business’ needs.
- Custom development for building on an open source solution can be very expensive and it never stops — you’ll need to keep your developers on retainer and constantly maintain and update your online store’s inner workings.
So, there’s no need to reinvent the wheel, especially when you’re going to have to add thousands of dollars per month to your budget. Using a hosted eCommerce solution just makes more sense for the majority of new online stores. Why start from scratch when there are so many proven software solutions already out there for you to use?
Hosting Options for Building Your Store
All websites need hosting — it’s how they appear on the internet, hosting provides the storage space for the potentially thousands of files that make any individual website work, and it enables an always-on internet connection to allow visitors to access it.
Popular web hosts include 1&1, HostGator, and GoDaddy. Typically, web hosting is inexpensive, although the price varies depending on your needs; ecommerce hosting may be as low as a few dollars per month while advanced options could be in the thousands.
Once you are working with a web host, you’re given access to a file manager interface where you upload (or directly edit) your website’s individual files. You can also install software within your website to serve a number of purposes, for example, WordPress for blogging, or other software to create forums and communities.
Your Domain Name
All websites require a domain name, which serves as the web address people type into their browser to visit your site.
Your domain name is purchased from a domain registrar and must be renewed every year, with the typical cost usually within the range of $10-$30. This depends on the TLD (top level domain) you choose, as well as other factors. Some web hosting companies may offer a free domain name registration with your hosting package, but it is usually only free for the first year or so. After that you will need to pay as normal to renew it later on.
There are some hosted eCommerce platforms that will also register your domain name for free when you sign up to use their services. Although it may only save you about ten dollars, it’s definitely convenient, and savings are savings. Make sure you ask about this when talking to a sales rep about a platform you’re interested in using.
What About Web Design Costs?
When it comes to designing the look and feel of your website, you will have to make similar choices as you did with development: do it yourself or hire a professional or look for existing solutions like themes or templates. It can be easy to convince yourself as a new business owner that you need custom web design, especially if you have an idea of exactly how you want your online store to look. However, it’s best not to get too attached to your initial concepts, because this may cause you to overlook concepts that could vastly improve your conversion rate — and because you shouldn’t dismiss the quality of the pre-built themes and templates that are available to you.
Custom design does have its benefits but be aware that custom web design from a competent professional can cost you thousands of dollars, and you can get a highly personalized design even if you begin with a template.
Templates are just that: templates that can be customized to your specific branding. A template can be built out so that it looks as if it were custom designed just for you. One of the biggest perks is that many templates are free, and even the paid only cost around $99-$250.
You can have also get the best of both worlds by choosing a template and paying a designer to customize it for you. At the end of the day you get the design you want at a more affordable price because the designer doesn’t need to start from scratch. Theme customization will typically cost you n $300 and $1,000, but it’s still far less costly than a completely custom web design.
Generating Content for your Website Comes with a Cost
Your website needs content, it can’t just describe your products, it also has to provide information to your customers and help establish you as an authority in your industry. Good site content also provides a great benefit to your search engine rankings, and the value of content writing can’t be overlooked.
You can write content yourself, but you may want to hire a professional content writer. The cost varies but will typically range between $50 and $75 per hour. Content writing is sometimes offered as an optional service from your eCommerce company, so this could be an easy way to get a good writer at a decent price.
Merchant Accounts for Credit Card Processing
The world of payment processing can be a daunting and confusing one. In order to accept credit card payments, you will need to have a merchant account with a payment processor. The cost of this varies, but most often comes down to a small percentage-based fee per transaction. PayPal and other alternative payment methods will also charge a similar fee.
The average rate you can get expect to get from credit card processors like Square or Stripe is 2.9% plus $0.30 per transactions.
Building Your Online Store for the Lowest Cost
If your head is spinning, here’s a quick review that narrows down the most clear-cut choices you can make:
Use a hosted eCommerce platform with:
• A full set of marketing tools
• Unlimited bandwidth with PCI Compliance and an SSL Certificate
• A wide selection of customizable mobile-responsive themes
• Built with SEO optimization options
• Integration with your choice of payment processor
• Frequent software updates
• Support team on hand for marketing, SEO, and technical support