How to start an ecommerce business: 7 steps from idea to first order

To start an ecommerce business, go through seven steps: choose a model — your own stock, dropshipping or a marketplace; register the business under your country's rules; pick a platform; find a supplier and build the catalog; set up payments and shipping; run ads on one channel; and set up order handling. The order matters: the model decides both your budget and your platform.

Beginners often start with the website: they pick a theme and only later work out where the products come from and what is left from one order. The money goes into a storefront with nothing to sell yet. Below, each step gets a short answer and a check, and at the end there is a launch budget for three ways to start, worked out on one illustrative store.

When people ask how to start an online store

Step 1. Choose a model: own stock, dropshipping or a marketplace

The model decides two things: whether you buy stock upfront and where the buyers come from. A marketplace is a sales channel, not a way of sourcing, but at the start many people pick it instead of their own site, so all three are compared here.

Pick a niche by three signs: the supplier keeps the product in stock, the price covers ads and fees, and returns are rare — no complex size charts, nothing fragile. What is left from one dropshipping order is worked out in dropshipping profit margin, and where to begin is in what is dropshipping and how to start.

Step 2. Register the business under your country's rules

Regular selling for profit is a business, and the registration rules are set by the country you live in, not by the platform. Check them before the first sale, because the business form decides your taxes and whether you need a VAT or sales tax registration.

• United States. If you trade under your own legal name, you are a sole proprietor by default and may not need to register anywhere; a trade name (DBA) usually has to be registered with the state, and an LLC or corporation is registered in each state where you do business. Sales tax permits and local licences depend on the state. The SBA guide Register your business walks through it.
• European Union. You usually register the business in your country and, depending on the activity, apply for permits; most businesses must register for VAT once turnover passes the national threshold or earlier for some cross-border sales. Each EU country has a Point of Single Contact; links are on Your Europe: Starting a business.

Selling to consumers also brings store rules: in the EU, buyers can cancel an online purchase within 14 days of delivery without giving a reason, and your terms must say so. Ask an accountant which tax regime suits your expected turnover before you register — rates and thresholds differ by country and change yearly.

Step 3. Pick a platform: self-hosted CMS, hosted platform or custom code

For a first store, building from scratch almost never pays off, so the choice is usually between a self-hosted CMS and a hosted platform. The difference is who keeps the site running: you or the service.

Test the platform on a free trial before you pay:

• add 10–20 of your products and look at the product page on a phone;
• import the catalog from your supplier's file (Excel, CSV, XML) — if products have to be entered by hand, hundreds of items take weeks;
• place a test order with payment and shipping to yourself;
• check that you can connect your own domain and export products and orders if you leave;
• in the "free" plan, find the limits: number of products, own domain, fee per sale.

How the CMS types differ in more detail is covered in types of CMS for an online store.

Step 4. Find a supplier and build the catalog

Find the supplier before the site, not after: prices, availability, photos and descriptions all depend on them. Before the first order, ask:

• what format the price list comes in — Excel, CSV, XML or API — and how often it updates;
• what the wholesale or dropshipping prices are, and whether there is a minimum advertised price (MAP) you must not undercut;
• whether they ship single units and how fast;
• who pays for returns and who is responsible for defects.

Where to look and how to check a company is in how to find and vet a dropshipping supplier.

A product page needs a name the way people search for it, photos, price, stock and attributes for filters. Set the price with fees, shipping and taxes included, not as "cost plus 30 %": formulas and an example are in how to calculate product markup.

Step 5. Set up payments and shipping

At the start, two payment methods and one or two carriers are enough. Card payments go through a payment provider such as Stripe or PayPal or the one built into your platform; each payment carries a processing fee, so include it in the price. How those fees add up is in merchant acquiring for online stores.

Carriers depend on the market: DHL, DPD, GLS and UPS in Europe, USPS, UPS and FedEx in the US. The store should create a shipping label, send the tracking number to the buyer and show you whether the parcel was delivered. Returns cost shipping both ways, so set aside a reserve: in the example below it is €100.

Step 6. Get the first orders

Start with one channel and an ad budget you are ready to spend on a test. A marketplace brings buyers from day one for a fee. Your own site gets almost no orders without ads in the first months, because organic search grows slowly, so traffic is bought in Google Ads or on social media — see Google Ads for ecommerce.

Before you launch ads, order from your own store on a phone, with payment and shipping to yourself. You will see where a buyer gets stuck and what arrives in the box. Then count the cost of an order, not clicks:

Cost per order = ad spend for the period / number of orders in the same period.

If it is higher than what is left from one order, change the product, the price or the channel — not the budget.

Step 7. Set up order handling

The first orders can live in a spreadsheet, but at several a day you need one database: status, payment, tracking number, customer history. Otherwise orders from messages get lost, and repeat buyers get no attention.

Keep income records from the first month: taxes and VAT thresholds are counted from revenue, and rebuilding it later from bank statements is harder than writing it down daily.

How much it costs to start an online store

It depends on the model, not on the website. In the illustrative example below, the same store starts from €400 on a marketplace with dropshipping and from €4,620 on its own site with its own stock. Stock bought upfront and ads make the difference.

Illustrative example for the arithmetic; the figures are not market prices. A home goods store, average order €40. We count spending for the first three months. Registration fees and taxes are left out, because they depend on your country.

The marketplace fee is not in the table: it is taken from every sale, not upfront, so it belongs in what is left from an order. On a marketplace you spend less on ads because the marketplace brings the buyers — that is what the fee pays for.

The second question is how many orders a month cover the fixed costs:

Orders per month = fixed costs per month / what is left from one order.

For the own site with dropshipping: platform €40 plus apps and domain €20 = €60 a month. If €5 is left from one order after the product, payment fee, ads and tax, you need 60 / 5 = 12 orders a month. The same calculation taken to a monthly plan is in ecommerce business plan, and the general method in break-even point formula.

Where beginners lose money and time

• Site before supplier. The design is ready, but the supplier gives no price list or photos — weeks of waiting and a catalog redone.
• Price as "cost plus markup". Fees, shipping and tax are not counted — every order loses money, and you see it only a month later.
• Stock updated by hand. The supplier ran out, the site still shows the product: cancellations, and on a marketplace also a worse seller rating.
• Several channels at once. The budget is spread thin, and it is unclear what works.
• No reserve for returns. Each returned parcel takes shipping both ways and ad money already spent.

When supplier price lists and orders outgrow a spreadsheet

When you have hundreds of products and they come from supplier price lists. Then most of the time in steps 4 and 7 goes into copying prices and stock to the store and orders from the store into a spreadsheet.

Elbuz takes over that part, next to the store you already run. It loads supplier price lists on schedule in XLSX, CSV or XML, turns rows into catalog products, calculates selling prices by your markup rules, writes descriptions with AI, and sends products, prices and stock to a WooCommerce, OpenCart or PrestaShop store and to Google Shopping, Meta and TikTok feeds. Orders land in one list with statuses — see order management.

Who doesn't need it yet: if you have a few dozen products and sell on social media, a separate system is too early. If you don't have a store yet, it can run on Elbuz CMS, a hosted ecommerce platform built on OpenCart 3: the store is created with one button, products, prices and stock come from your Elbuz catalog, card payments go through Stripe and PayPal, and website orders go straight into Elbuz.

Catalog and price lists in ElbuzSupplier prices and stock sent to your store, 14 days free

FAQ

Do I need an LLC to start an online store?

Not necessarily. In the US you can start as a sole proprietor under your own name; an LLC separates business and personal liability but costs state fees. In the EU the forms differ by country — see step 2.

How much does it cost to start an online store?

It depends on the model: stock bought upfront and ads cost more than the site. In the illustrative example, three months cost from €400 on a marketplace with dropshipping to €4,620 on your own site with your own stock.

Can I start an online store with no money?

Almost, but not quite. Dropshipping removes the stock cost and a marketplace removes the site, but ads, returns and payment fees still cost money from the first order.

What do you need to start an ecommerce business?

A product and a supplier, a registered business, a place to sell — your own site, a marketplace or social media — payments and shipping, and a channel that brings buyers. The order is in the seven steps above.

What sells best online?

Products the supplier keeps in stock, priced to cover ads, fees and returns, with few returns. Check what is left from one order, not how popular the product is.

What is the difference between a marketplace and an online store?

On a marketplace you sell in someone else's storefront: buyers are there from day one, but the marketplace sets the rules and the fee. In your own store the rules and the customer base are yours, but you buy the traffic. Many sellers combine both.

Sources

• US business registration: sole proprietorship by default, DBA, state registration for LLCs and corporations — sba.gov, Register your business.
• EU business registration, Points of Single Contact, VAT registration — europa.eu, Your Europe: Starting a business.
• EU right to cancel online purchases within 14 days of delivery — europa.eu, Your Europe: Returns.

Checked 01.11.2026.