You have a great idea for an online business. You want a website up as soon as possible. You’ve heard of free website-builders through GoDaddy, Wix, etc. Or you know that WordPress is a free platform to build a website, and then WooCommerce or Easy Digital Downloads are free plugins to start selling online. Now, you might think that the cost of selling online is going to be next to nothing.
This may be true to simply get your products online for potential customers to access. However, it probably won’t create the best experience or build a reputable brand without investing more into your online store.
In this article, I’ll go over some costs that you have to pay, and others that you should pay to build a sustainable, ongoing business online. This is not an exhaustive list, but should give you a good idea of what you should or could be investing in.
For any type of eCommerce presence online, you’ll have to pay some basic costs. Some eCommerce platforms may not charge these up-front though. For example, there’s a very small listing fee on Etsy, and then you’re charged a fee per transaction. This will get your products listed on a store that’s an extension of the Etsy.com URL.
But, if you want a standalone store with your unique URL, here are some costs you’ll have to consider starting off:
The first thing you will need to purchase is a domain name. This allows you to have an independent URL like
http://yourstorename.com rather than being an extension of another platform like
Domain names typically cost $11-$15 per year. Your own domain gives your brand more legitimacy and will go a long way in building trust amongst your customers.
The next thing you will pay to set up your online store is web hosting. There are different hosting packages you can opt for. The cheaper hosting options can start at $5-$7 per month. This will give you access to the servers to install WordPress and build your site with the lowest bandwidth option for that host.
However, as with all things, you get what you pay for. If server management is not something you are too familiar with, you may be well served to go with a managed hosting for WordPress. This means that the hosting company will typically take care of managing traffic load and speed, ensuring security, and updating WordPress and the plugins. Managed hosting typically costs more, generally starting around $10-$12 per month.
At this level, we recommend Siteground’s GoGeek plan for new / small eCommerce sites — it has great security and features for a low price.
No matter which starting plan you choose for hosting, as your store’s popularity grows and you get more traffic, you will need to upgrade your hosting plan to accommodate higher bandwidth. So, it’s important to keep in mind that the plan you start with is probably not going to be the plan you’ll be using as your store grows.
Next thing you will need to pay for, generally on a per transaction basis, is the payment gateway you use for processing online payments. This includes gateways like PayPal, Stripe, etc.
Gateways typically charge a percentage of the transaction, plus a fixed amount. For example, Stripe charges 2.9% plus $0.30 per successful transaction.
The above list includes base costs that you’ll have to pay to get your independent store site up. You can use free plugins like WooCommerce and Easy Digital Downloads to set up your store and start selling.
But, it’ll go a long way for you to invest in a few extra things for your store to make it secure, professional, and trustworthy.
Your store’s branding is one of the main things that people will remember. This includes your logo, graphics or fonts used on the site, layout and design for any eBooks or other digital properties.
I had one experience in building a site where I tried to keep all broader brand guidelines from the client in mind. However, the client refused to pay for a graphic designer to design the logo. The client ended up picking a free JPG image online and modifying it in Microsoft Paint. Needless to say, the logo did not fit in at all with the rest of the brand guidelines or the website. Something like that can very quickly kill your store’s credibility, and make your store memorable for the wrong reasons.
Depending on your requirements, you can probably get a graphic designer starting at $1,000 for basic logo design. You can choose to get really low-priced freelancers for $100 or $50 per project, but the work will typically show that graphics were done on a budget.
Although it is easy get your store up and running, it doesn’t mean that the design and functionality creates the best user experience, or that your plugins and chosen theme all work 100% the way you need them to. Many plugins may do everything you need, but sometimes they may only get you 95% of the way there.
When you want to take your store to the next level of professionalism, you can invest in quality design and development to improve the browsing experience for your product catalog, or customize plugins to make them fit your exact needs.
On top of investing in graphics and design for your store, it can be worthwhile to invest in professional photography for your products.
Learn more about how professional product photography can boost your eCommerce business in our recent post.
Backups are one of those things that we don’t think about until we actually need them. And when you do, they can be life-savers. This is especially true when you’re running an online store with orders and customer information — they’re an essential insurance policy for your site. For any reason that you lose data for all or part of your store, it is your customers whose orders will be lost or unfulfilled.
You will also lose all the customer information that you can use to target specific customers. WordPress has a number of backup solutions to accomplish this. You can use something like VaultPress which starts at $99 per year.
An SSL certificate creates an encrypted session between a customer’s browser and the server. This is especially important for keeping transaction information like credit card number, customer’s personal information, etc. secure.
An SSL certificate also gives your site the “s” in “https://” and gives your site the “green address bar”.
All things being equal, secure sites are typically ranked higher in search results. An SSL certificate can cost you about $100-$130 per year for the base packages.
Think of the type of business you’re trying to build online. The more you put into your store, the more you will get out of it in terms of revenue, customer trust, and brand reputation.
Now, there are always exceptions to the rule. If you actually have a product that nobody else is selling, that everybody wants, and that already has a great reputation, maybe you can get away with not spending on certain things for your online store. But for 99% of people starting their eCommerce journey, these are realistic costs that you should keep in mind and not shy away from.
If you start a business, selling on your own online store is one of the highest-margin sales channels you can probably use. There are no retail stores, and typically no wholesale distributers you have to go through. You sell directly to your customers, and you get to hear directly from your customers about what works and what doesn’t.
There are many off-the-shelf low or no cost platforms you can use to start your online store. But, building your business based on your online store is very different that simply selling online. It is easy to be seduced by ads suggesting that the cost of selling online is only going to be a few dollars per month. There are a lot of advantages to investing in your online store to make it a secure, robust, user-friendly, and unique shopping experience. In a lot of ways, how much you are willing to invest into your store will determine how successful your business may be.
Are there other costs you think are essential to setting up an online store? Were there costs you weren’t expecting to pay or expecting to pay as much during your store journey? Tell us in the comments below.