How to Start an Online Retail Business | 9 Simple Steps

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Are you ready to become an online retail business owner? Great timing! There are more than two billion digital buyers worldwide, all gearing up for their next purchase.

Becoming an online retailer is one of the most rewarding things you’ll ever do. But let’s face it – it isn’t easy! Stepping into the world of ecommerce and building an online store can feel overwhelming, which is why we’ve outlined all the steps you need to take to become an online store owner without any prior experience. Let’s do this.

1 Find Your Niche

There are all sorts of things you can sell online, but you need to be sure there’s a specific market willing to purchase those items. Any time spent conducting research and due diligence is well worth it to find your online niche.

You don’t need a wide range of products to succeed. William Abraham, for example, has built a successful online retail store that sells only one thing: men’s luxury socks. This helps simplify the business, and allows the company’s marketing team to run laser-targeted email and social campaigns.

Niche selection example - William Abraham
Niche selection example - William Abraham

Here are a few tools and tips you can use to research and validate your products:

  • Use Google Trends to research how popular a certain product or niche is.
  • Use keyword research tools to understand how many people search for certain products in a given month
  • Analyze product demand on social media and online marketplaces such as Amazon and Alibaba

2 Check the Regulations

It’s great to have entrepreneurial dreams, as long as they’re grounded in reality. That’s why you’ll need to understand the basic laws and regulations associated with starting an online retail business before you begin. Here are the main things to consider:

If you have any doubts about these aspects, we highly recommend seeking professional help. The last thing you want is to get into hot water with Uncle Sam!

Further information:

3 Source Your Stock

Now that you know what you want to sell, you’ll need to find reliable manufacturers or suppliers to stock up your inventory. These typically fall into two broad categories:

Manufacturers/Wholesale Suppliers

You can search for wholesalers on websites such as Alibaba, Kompass, and ThomasNet. Check their ratings and reviews, and feel free to ask any questions – or even request a sample of their product – to assess whether you want to work with them.


With dropshipping, you won’t need to worry about buying the product in bulk, keeping it in your inventory, or shipping it out. Dropshipping suppliers ship products directly to buyers, so all you need to do is take the order. You can find dropshippers on platforms such as SaleHoo and Oberlo, and link them to your online ecommerce store with ease.

How dropshipping suppliers work
How dropshipping suppliers work

Image Source: Nexcess

4 Create a Brand

Many aspiring business owners make the mistake of treating design and branding as an afterthought. Don’t let that be you! Here’s an essential checklist to help you kickstart your brand:

  • Decide on a memorable name, and design a professional logo that makes your online retail store stand out from the crowd
  • Pick a color scheme and font pairing to use consistently throughout your website, social media, and other marketing collateral
  • Set your brand’s writing style and tone of voice based on the type of personality you want to convey
  • Branding is more than logo design. Zero in on your brand’s mission, vision, and values

A great example of branding done well is Tentree. The company is on a social mission to plant a billion trees by 2030. Its environmental commitment is evident in every aspect of its online store, including in its nature-inspired photos. All these aspects infuse the business with a sense of personality that customers can trust and relate to.

Tentree’s environmentally-conscious branding leads the way
Tentree’s environmentally-conscious branding leads the way

You can also take a look at your competitors and other online retail businesses to learn what’s working for them, and why. This will help you generate branding ideas for your own online retail venture.

Further information:

5 Create an Online Retail Store

Gear up! We’re ready to begin the fun part. To create your online retail store, there are several ecommerce website builders you can choose from, including Wix, Shopify, and Squarespace. The main benefit of using such a platform is the ability to build and manage your store without requiring any coding or technical skills.

An online store builder comes with plenty of themes, tools, and integrations to customize your store’s design and features. You’ll also get dependable support from your chosen ecommerce platform if you get stuck at any stage.

6 Showcase Your Products

Once you’ve set up your online retail store, it’s time to start adding your products. But this step is not to be rushed – you should take your time with the aspects that play a big role in user experience and conversions, which include the following:

Product Photos

To persuade people to make purchases online, you need to provide eye-catching photos of your product that help potential customers visualize its look and feel. SoYoung is a great example of this. For each product, you’ll find large, high-quality photos taken from different angles in different settings.

Example of product photos from SoYoung
Example of product photos from SoYoung

Product Descriptions

The next important aspect is the product description. You should describe your product in as much detail as possible, with detailed specifications, features, benefits, FAQs, and more. For example, take a look at how Method describes a hand wash gel:

Example of product description from Method
Example of product description from Method

This product description doesn’t just focus on the fact that the gel will make your hands soft and clean, but also that it will make the holidays more exciting. Remember, you’re not just selling a product, but an experience – so make it sound enticing!

7 Price Your Products Fairly

When it comes to pricing, we’re sure you understand the basic concept:

  • Low pricing means more purchases, but less AOV (Average Order Value)
  • High pricing means fewer purchases, but a higher AOV

The trick is to know where to draw the line. While there’s no rule of thumb, we recommend selling items that have a minimum value of $100.

Think about it – considering the cost of operations, inventory, and marketing, you’ll probably end up with a 20-30% profit margin. If you sell a $30 item, you’re making only $6 on each purchase. In contrast, selling a $100 item puts $20 in your pocket.

Moreover, the time and energy you’re spending on your business are going to be the same, whether you sell products worth $20 or $200. So, you might as well get more of a return for your time and effort, right?

Further information:
  • Our guide on How to Price a Product goes into more detail about what to consider when setting prices for your stock

8 Package and Ship Your Products

Next, you’ll need a system to get your products to buyers as efficiently and securely as possible. If an order arrives late or damaged, that may very well be the last order you’ll see from the customer who placed it.

In fact, a survey by Digital Commerce 360 revealed that many customers won’t complete a purchase if the product doesn’t stand to arrive by the expected time.

Graph depicting consumers that don’t follow through with a purchase because of a delay in delivery
Graph depicting consumers that don’t follow through with a purchase because of a delay in delivery

Image Source: Digital Commerce 360

Firstly, you’ll need some essential packing supplies, such as mailing envelopes, bubble wrap, scissors, packing tape, and shipping boxes. These will help you keep the product safe while it’s in transit.

The second essential component is a logistics partner. You have several options available when it comes to shipping products, including USPS, UPS, and FedEx.

Each of these courier companies has a variety of shipping plans – so make sure to read the fine print before opting into a particular package!

9 Create a Marketing Plan

It’s one thing to get your online retail store up and running, but another thing entirely to bring in traffic and sales. This means your job isn’t done unless you have a marketing strategy in place.

Leading traffic sources from ecommerce websites
Leading traffic sources from ecommerce websites

Image Source: Semrush

There are plenty of ways to get exposure for your online retail business’s ecommerce store. These include:

Email Marketing: Use an email marketing service to build relationships with people who sign up on your store, and to promote new deals and discounts.

Social Media Marketing: Set up an account on social media platforms, post interesting content regularly, and advertise on the likes of Facebook, Instagram, Twitter, and Pinterest to build up a loyal following.

Search Engine Optimization (SEO): Social media ads are ideal for attracting immediate traffic to your retail site, but they’re going to cost you a fortune. So make sure to leverage our top SEO tips in parallel with your paid campaigns, to help build long-term, organic traffic.

Starting an Online Retail Business: Summary

The biggest obstacle between you and your retail business is knowing what to do and how. With that in mind, here’s a recap of what we’ve discussed in this guide.

Steps to Start an Online Retail Business

  • Find Your Niche
  • Check the Regulations
  • Source Your Stock
  • Create a Brand
  • Create an Online Store
  • Showcase Your Products
  • Price Your Products Fairly
  • Package and Ship Your Products
  • Create a Marketing Plan

As you start implementing these steps, you should rely on your best judgment and a “trial and error” approach to make your retail store a success. The more prepared you are to make informed decisions, the closer you’ll be to your dream!

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