Find out how to start an ecommerce business following a step-by-step guide that shows you how to
Ecommerce is one of many business avenues and is best known for being an accessible, scalable, and low-cost way to start your own business.
But having a successful ecommerce business is much more than just listing items to sell online. It takes a solid business plan, a clear strategy, strong branding, effective marketing, and a focus on delivering a good customer experience.
As with any other business venture, there are important practices that can help your business succeed, as well as common pitfalls you should avoid.
In this article, we’ll offer a step-by-step guide for ecommerce business owners, covering how to write a business plan, sourcing products, setting up an online store, marketing and shipping strategies, overall costs, and top tips for success.
- You can source products bycreating your own goods, reselling, partnering with a manufacturer, or dropshipping.
- You can choose to handle shipping yourself, or you can outsource it to a fulfilment service (e.g. Amazon Fulfilment Centre).
- Typical costs of running an ecommerce business include awebsite builder, product manufacturing, shipping, and IT support.
- If you choose to build your own website, you’ll need a reliable payment gateway to ensure customers can pay securely and without hassle.
- You should avoid selling perishable goods, heavy products, and trademarked items.
What is an ecommerce business?
An ecommerce business is a venture in which you sell products or services over the internet instead of (or in addition to) a physical store.
Ecommerce is one of the easiest business ideas to start, especially since it typically comes with low setup costs.
Unlike traditional retail make money, and how it will grow over time. It also helps you organise your ideas, set clear goals, and guide your decisions.
For an ecommerce business, it should detail what you’re planning to sell, how you’lll take to earn revenue and become profitable
Here’s a quick breakdown on what it should include:
- A brief summary of the aims of the business
- Its name, vision, and brand information
- What the opportunity is
- Details of the addressable market you are targeting
- Sales product information
- Competitor analysis
- Operational details
- Your wider sales and marketing strategy
- Delivery and order fulfilment plan
- Yearly or monthly financial plan
Not sure where to start? Check out our business plan guide for everything you need to know, with a free template included.
Step 3
Next, you’ll need to find the most effective way tod will be key drivers in this market.There are many options for sourcing products, though specific options depend on the product range your ecommerce business sells
Either way, the quality of the goods you sell is a vital consideration when sourcing products, and your business will gain a bad reputation if you sell poor-quality items. You also need your productstent supply and can meet periods of high demand
Here are the most common ways to
- Creating your own:selling your own designs, crafts, handmade jewellery, and other popular products via online marketplaces.
- Reselling: buying products in bulk from wholesalers or other retailers and selling them online at a markup.
- Partnering with a manufacturer: working directly with a manufacturer to produce products according to their specifications, allowing for custom designs, bulk production, and potentially lower costs per unit.
- Dropshipping: an increasingly popular route for sourcing products. Instead of holding stock yourself, when a customer places an order, a third-party supplier ships it to them. You can sell more products without having to buy them as stock.
- Micro-fulfilment centres (MFCs): these are small and highly automated storage facilities — often no larger than 10,000 square feet — located in densely populated urban areas.
Licenses and restricted goods
However youuire additional permissions before you can sell them. For example, products like alcohol, tobacco, and certain health or cosmetic items often need licenses or approvals from the UK authorities to be sold legally. These include:
- A license to sell alcohol online, as well as following age verification rules.
- A tobacco retail licence for tobacco products, and there are also strict rules around advertising, health warnings, and age verification.
- Some supplements or health devices may need approval from the Medicines and Healthcare products Regulatory Agency (MHRA).
- Certain ingredients for cosmetics and skincare are restricted, and products must meet the UK Cosmetic Regulations with proper labelling.
- Electrical products and toys must comply with UK safety standards and have appropriate CE/UKCA markings.
Important to know: Product Regulation & Metrology Act 2025
In July 2025, the UK government introduced the Product Regulation and Metrology Act to protect consumers from unsafe products and hold online marketplaces and sellers accountable for ensuring the safety of certain products.
Read our guide on the Product Regulation and Metrology Act for everything you need to know to stay compliant.
Step 4. Choose your selling channels
After preparing your products and listings, you’ll need to decide where you want to start selling online. There are several options for this, including selling through your own website, an online marketplace, or social media platforms like TikTok Shop.
Ecommerce website builders
It’s relatively easy and affordable to set up an ecommerce platform to sell your products. This is a software that offers all the tools needed to run an online store in one place, including product listings, inventory tracking, checkout, payment processing, and more.
AI website builders also allow you to build a fully-functioning store in seconds, removing the need for technical setup and letting you start selling almost immediately. For example, Wix is our top-rated option as it provides an all-round solution – offering AI-powered design, ecommerce tools, and built-in marketing features in one place.
Building your own ecommerce website
If you opt to build your own ecommerce website, it can take some work (and cost) to launch. You’ll also need a reliable payment processor, known as an online payment gateway.
These use encryption and other security features to protect customer payments, which is vital and will aid with customer retention. You can further improve payment security by investing in an SSL certificate, which provides your site with a padlock in the search bar to promote your site as secure and can improve its search engine ranking. Remember to be transparent about the data privacy measures you have in place.
Online marketplace
Online marketplaces – such as Amazon, eBay and Etsy – provide you with a ready-made audience that shops on these sites, increasing the reach of your products. They also already have established traffic, built-in payment systems, and tools to help you list and manage your products.
However, the drawback is that these platforms often charge commission on every sale you make, along with listing or transaction fees. You may also have less control over your branding, pricing, and how your store is presented to customers.
Social media
Another popular channel is to sell directly on social media platforms like TikTok and Instagram. Known as social commerce, this allows customers to discover and purchase items without leaving the app. You can also promote products, interact with customers, and complete sales through features like shoppable posts, product tags, and in-app checkout.
Social commerce isn’t just an online fad either, as $138.91bn in 2026, with skincare dominating 41.52% of beauty ecommerce revenue last year.
Need funds to start your ecommerce business? Read our guide on ecommerce funding options to explore different ways you can raise capital and kickstart your online store.
You are required to register for value-added tax (VAT) if you generate £90,000 or more in turnover. However, some businesses register for VAT voluntarily as it allows them to reclaim VAT on certain expenses (such as software, inventory, and marketing).
Voluntary registration can also make a business appear more established and credible, particularly when working with other VAT-registered businesses. It can also help prepare for growth if they exceed their turnover to exceed the VAT threshold in the near future.
Final thoughts
Ecommerce is an exciting opportunity for those looking to start a business, especially with how easy and cheap it is to set up, and the UK’s advanced market for online purchases.
However, to be successful, you should plan carefully, choose the right products, build a strong brand and use effective marketing strategies to reach your target audience and get the best sales possible.
It’s also important to keep the customer experience in mind through your communications and ensure your products are delivered quickly, safely, and as expected.
With this kind of approach, ecommerce can be a rewarding way to grow a business online, building a brand that people trust and keep coming back to.
Don’t forget to download our free business plan template to map out your strategy and build a strong foundation for success.
Emily ClarkTaking Payments Editor
As the Taking Payments Editor, Emily specialises in content around POS, merchant accounts, and accounting – helping SMEs understand the tools and services they need to take payments confidently and grow their businesses. She also holds an MSc in Digital Marketing and Analytics, giving her the knowledge and skills to create a diverse range of creative and technical content. With a genuine passion for helping small businesses grow, Emily is all about making complex topics accessible and creating content that can help make a difference.
