The UK is the world’s third-largest e-commerce player with annual internet sales of £80 billion. Yet despite these rich pickings, just 53% of UK SMEs have an e-commerce presence. Many small businesses are not tapping into this potential revenue stream because they think an online store costs too much.
We’ve researched three ways that you can sell online and keep costs down.
How much does building an e-commerce site cost?
Expert Market estimates the upfront cost of designing an e-commerce site at between £1,017 to £2,850. But prices vary hugely depending upon site design and any features you add.
To build a site to sell online, you need to consider:
- Design – a custom-made site costs considerably more than building it yourself using a template. Expert Market estimates between £2,500 to £10,000 for a bespoke solution.
- Domain name – it costs to register for a custom domain. Prices differ according to a domain name’s popularity and the last part of it, the extension. A standard extension such as .co.uk from website builder 123.reg costs from 99p a year, but domains at the higher end of the scale, such as luxury.fashion can cost hundreds of pounds.
- Hosting and content updates – the monthly fee to store your website on a web-hosting server provided by a web hosting company ranges from £10 to £410.
- An SSL (Secure Sockets Layer) certificate – allows you to use https in your address bar. The ‘s’ stands for secure and protects your site from hackers. SSL certificates, required by the payment card industry, cost from £5 to £200 a year.
- Payment gateway – you’ll need to take payments online so budget for the payment gateway provider’s set-up fee, monthly fee and charges for transactions.
3 Ways to Launch an E-Commerce Store
Your next step is to decide on one of these three solutions, based on your resources and needs.
1. Use a platform builder
“Advertising makes building a site sound simple, but if you have no website development skills and start building a site using a template, you’ll find it’s more complicated than it seems." says Ryan James, creative director of Red 13 Digital. "Time is money, and people can spend 100 hours trying to build a website that ends up looking amateurish, so they leave feeling frustrated.”
If you don't have the technical skills, you can build an affordable online store using e-commerce plans from platform builders such as Wix, GoDaddy, Squarespace, Shopify and WordPress.com.
Website builders charge from £3 a month for a basic plan, rising to £30 a month for an advanced payment plan with a full e-commerce solution. A website builder provides everything from web design to payment set-ups in one place so you can focus on your core business and find more customers.
2. Create a bespoke website
For a truly unique site, a bespoke solution is the best alternative to a template – even though it can be more expensive to start with.
However, once it’s up and running, the maintenance costs of a bespoke site are minimal, so savings over time could add up and make all the difference.
James says there are other gains to be made, “Using a template that others have used means your site looks like everyone else’s. A bespoke site is best if you want a website to stand out in the marketplace.”
3. Sell through a marketplace
Some sellers save cash by selling through a global marketplace. It takes little time to set up and can be more profitable, even with fees and commission rates.
To start selling on Amazon, individual businesses selling fewer than 35 items a month pay no monthly subscription fee but £0.75 per item sold. If you are selling more than 35 items, a professional plan costs £25 a month.
Amelia Clark kickstarted her greeting cards business Dippyfish Cards on Etsy.
“Well-trodden pathways like Amazon and Etsy seem a better option as initial costs are much lower than developing a website, which is a massive job," she says. "You are more likely to generate sales [on a well-known website] with less input than driving 100% of your sales to a new website.”
When you're ready to set up your e-commerce store, consider paying for your expenses with an American Express® Business Gold Card¹. Not only is the Card accepted by well-known platforms providers such as Wix, GoDaddy, and WordPress.com, as well as marketplaces like Amazon, you get up to 54 days to pay off your balance, so you have more working capital to spend on marketing your online store or upgrade its features.
On top of that, you can earn Membership Rewards® points² with every pound you spend, and they can be leveraged to grow your business further.
- The maximum payment period on purchases is 54 calendar days and is obtained only if you spend on the first day of the new statement period and repay the balance in full on the due date.
- Membership Rewards points are earned on every full £1 spent and charged, per transaction. Terms and conditions apply.
- If you'd prefer a Card with no annual fee, rewards or other features, an alternative option is available – the Basic Card.