How to Start an Ecommerce Business in 9 Simple Steps

How to Start an Ecommerce Business in 9 Simple Steps
Everything you need to know about setting up an eCommerce business. Find out in 9 simple steps how you can start an eCommerce business with Square.
by Square Nov 20, 2021 — 7 min read
How to Start an Ecommerce Business in 9 Simple Steps

With Australia currently listed as the world’s 11th biggest ecommerce market, and with online sales growing by an incredible 15.5% every year, it’s clear to see that the future of business is online. Thanks to a wealth of smart tools, it’s never been easier to establish your own eCommerce business.

While the opportunity is great, there are many challenges that stand in the way. It’s not easy to turn those entrepreneurial dreams into reality – it’s why people with million-dollar ideas are many, but millionaires are few. Starting a business from scratch can be an overwhelming proposition.

Ecommerce success rests on a combination of ambition, commitment and strategy. And it’s that last point that we’ll shine some light on today, as we look at how to start an ecommerce business in nine simple steps.

1. Choose your product

How to start in eCommerce? Your first challenge will be to choose what to sell.

You may already have a product or niche in mind, but for those who don’t, some of the most popular eCommerce product categories include:


With such a huge variety of products now able to be bought online, success is built upon choosing a niche. You want to focus your energies on a specific category, or even a specific product, and work to be the best. This ensures you don’t get overwhelmed by endless products during the busy start-up phase, that you don’t have to invest in endless inventory, and that you can work to get your brand and product in front of a specific target customer. As you grow, so too can your range, based on feedback from your customers.

The best product will be one that you are passionate about, as this helps to increase your motivation, and/or that you have deep experience in, as this makes marketing and selling the product far easier.

2. Do your research

Once you have a product niche in mind, the next step in how to set up an ecommerce business is to check whether it represents a viable business opportunity. You’ll need to understand the size of the market and the seriousness of the competition.

Start with a simple Google. Type in the name of the product and scope out your biggest competitors. Analyse what they’re doing well and what they could be doing better. Consider how you would replicate the good and capitalise on the bad. Ideally you’ll identify an underserved market or a competitor-free gap that you can fill. The two most effective ways to accomplish this are by:

  1. Creating a totally new product
  2. Marketing or selling an existing product in a new way.


Test your idea using a SWOT analysis – strengths, weaknesses, opportunities and threats – to gain a clearer picture of the realities of your potential business. Strengths and weaknesses are largely controllable factors like reputation, location, culture, target customers, marketing and business partnerships. Opportunities and threats on the other hand are factors that you don’t have direct control over; things like supplier and competitor activity, the economy, regulation and market trends.

It’s also wise to form a basic budget, to gain an understanding of the upfront and ongoing costs that you’re likely to face in your new venture.

3. Find suppliers

The next step to setting up an ecommerce business is rather simple. Can you get your hands on the product that you plan to sell, or the materials you need to make it?

Search for a product that meets your needs in terms of things like price, quality and functionality, and a supplier that can be relied upon to deliver. Many eCommerce entrepreneurs begin by sourcing products from wholesale online distributors, though sometimes these marketplaces aren’t typically known for their quality, and dealing with themcan come with other risks in terms of reliability and regulatory compliance.

Aim to source quality products (or materials) from a reliable supplier with whom you can work directly. If you plan to order products or materials in bulk, try to negotiate a discount.

4. Build your brand

Homework complete, it’s time to brand your business. A snappy name and an eye-catching logo make your business more memorable, which is critical to attracting those lucrative return customers.

While there’s no foolproof process that guarantees you’ll find the perfect name, there are a number of tips that can help to push you in the right direction:


And in terms of your logo:


5. Register your business

Now that you have a business name and logo, you’re ready to register your new venture. In Australia all businesses need to be registered with the Australian Securities and Investments Commission (ASIC). The process is quite simple, able to be completed online in a matter of minutes, at which point you’ll be given an Australian Business Number (ABN), a unique 11-digit number that identifies your business, primarily for tax purposes.

You can either be registered as a sole trader or as a company. It’s wise to consult with a professional to decide which is the right option for you, but in the most basic terms, the setup costs are higher for companies when compared to sole traders, but the personal liability is lower.

Depending on what you sell and where and how you sell it, you might also need to secure permits and licences in order to operate legally. Check whether you require any of the following:

6. Create a business plan

Now comes time for perhaps the most important part of the process. Your business plan is your path to success: a road map designed to guide you to eCommerce glory.

A business plan establishes your goals and defines the steps you need to take in order to achieve them. Not only is it critical internally, it is also a required document if you hope to secure an investor or a business loan. As such it needs to be a comprehensive and rather professional plan.

There are a wealth of business plan templates available online which can serve as inspiration, but at a base level it should be a short and punchy (15-20 page) document that includes the following information:


Your venture won’t have a single, definitive business plan, as this is a document that must be written with the audience in mind:


Your business plan isn’t a document that you set and forget. As your business grows and evolves, so too will your business plan, so be sure to regularly update it so that it continues to reflect the realities of your business.

7. Set up your online store

Building an online store has never been cheaper or easier, with tools like Square Online, our free online store building platform.

7.1 Build and customise your website

Use Square Online’s free store builder to create the perfect eCommerce website for your business. Choose from a host of templates that you can customise with colours, fonts, and design elements, and enjoy a site that is mobile-optimised from the get-go.

7.2 Take secure payments

Square’s instant payment system takes moments to set up, accepts all major cards, and deposits the funds in your account as soon as the next day. Processing fees are capped at a maximum of 2.2%, and by using this as part of ecommerce platform, you won’t even have to manage PCI compliance!

7.3 Run your store

With features like a real-time shipping rate calculator, integrated shipping labels, automated abandoned cart and shipping confirmation emails, a custom domain, and a wealth of analytics and insights, Square makes running your online store a cinch.

7.4 Manage inventory

By combining Square Online with Square Point of Sale and Square Dashboard, you can automatically sync orders, items, and inventory, and track fulfillment and delivery more easily.

8. Learn SEO basics

Search engines are critical to the success of any online business. Google, and to a lesser extent Yahoo! and Bing, are essentially the gatekeepers of the internet, directing users to the most relevant sites possible, based on the search terms they enter, by way of an ordered list.

The process of making your website as ‘Google-friendly’ as possible, and thus gaining a spot further up the search engine results page, is called search engine optimisation, or SEO.

SEO is a complex field, not least for the fact that Google keeps its ranking recipe a closely guarded secret. In truth, no one but a handful of people within the company know exactly what Google wants. SEO best practice is built on trial and error – seeing what works and what doesn’t, then doing more of the former and less of the latter.

If you’re serious about the success of your eCommerce store, you should first learn some SEO basics, and you should then employ the services of an SEO professional – an individual or organisation that keeps up with the latest search engine developments, and who can ensure your website is as Google-friendly as possible.

9. Get marketing

In some ways the final step of the process represents a switch from establishing your eCommerce store to running it. It’s time to put on your marketing hat.

Marketing is a subject that deserves far more attention than we’ll be able to give it here, so it’s wise to check out our guide to creating a business marketing strategy when you get to this point of the process. But some initial marketing steps include:

To become a business owner. It’s the dream of many, and eCommerce makes that dream more attainable than it’s ever been before. You don’t need endless money, resources or even knowledge; all that’s required is an idea and a deep desire to make it happen.

And for those ready to begin their eCommerce journey, you can trust Square to deliver the knowledge, tools and support that you need to succeed.

The Bottom Line is brought to you by a global team of collaborators who believe that anyone should be able to participate and thrive in the economy.


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