E Commerce has a multiple number of costs associated with it. Let us take a look at some of them at the top level. We are deliberately not including the costs that are common to all businesses such as inventory costs and transportation and shipping
Web Hosting and domain costs
Every E Commerce project if hosted on its own domain would need a domain name and a hosting space. The domain name also needs to match up with the brand name that you plan to use.
The hosting space is needed to host your product, customer and sales data. The hosting space usually is bundled with the domain name costs if both of them are purchased together.
Software costs
IF you are planning to use free open-source software, you would not need to spend any money upfront as software cost. If you are opting for hosted solutions provided by providers such as Shopify or if you are hosting on large E Commerce portals you may need to pay fees related to listing of the product.
In case you are using a hosted solution on your own, you might need SEO plugins, payment gateway plugins, email management, inventory management and other software. These may or may not cost money and you need to do your research to determine the costs associated with them.
Technical support costs
Even though your software may cost nothing, you may be lacking either in time or in skill to install and run it properly. You would also need to customize it to suit your brand image. These processes involve a consultant which can help you make these customizations. Based on the complexities of your need, consulting work may range from cheap to really expensive. If you decide to do it all yourself, you will need the time to learn them on your own. This may take your attention away from your main business.
Digital Marketing
Digital marketing includes running ads on Google and social media platforms such as Facebook, Pinterest or Instagram.
You would also need to pay influencers to help promote your products
Also , if you wish that your customers discover your products when they search about it on Google , you would need to pay Google to run ads on your behalf.
You would also need to create blogs and pay content writers a sizeable amount for writing posts about your products.
Customer Support costs
Customer support is an essential part of E Commerce project. You would need to be able to answer emails or calls from telephone. The internet users are often fickle and quick to take offense, so it is important that issues are resolved as soon as possible. You would also need to set up processes with your logistic providers as returns are a big part of your E Commerce system. These all need employees and thus may cost money.
Cost of product listing
Product is not just a static thing. It comprises of text, images and manuals associated with it. To make product look interesting you would need to hire artists who can add a bit of design to the product details such as an explanatory graphics. You would also need to redesign manuals to make them fit the web standards. You would need to take good photographs of your product from different angles and different sizes/resolutions.
These too cost money and thus they form a line item in your cost calculations.
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