How to start an online store for your small business

Starting an online store can be a profitable venture for small businesses looking to boost sales and establish their brand. The potential benefits include: 

• Reaching more customers. While a physical shop serves local customers, an online store can open your business to regional, national, and even global customers, broadening your reach and increasing sales potential.
• Selling 24/7. Online stores don’t close. Customers can browse and buy whenever they like, whether that’s early morning, late evening, or weekends. This can mean more overall sales compared to businesses with fixed opening hours.
• Reducing overheads. Online stores can be more cost-effective to run compared to physical shops. You can avoid expenses like rent, utilities, and in-store staffing, and reinvest those savings into marketing and product development.
• Gaining customer insights. E-commerce platforms can provide detailed customer data that physical stores can’t easily capture, like popular products, user behaviour, and customer demographics. Small businesses can then use this data to make informed decisions about inventory, pricing, and marketing.
• Boost brand visibility. An online presence can enhance your visibility. Search engines index your site, making it easier for potential customers to find you. Combining a social media and digital marketing strategy can help you reach a wider audience.
• Offer convenience. Many consumers prefer online shopping. In the UK, nearly 85% (external link) of the population shops online. It lets customers compare prices, read reviews, and research products before making a purchase.
• Scale with ease. Adding new products to your site doesn’t require extra square footage. Small businesses can test new markets or products online with minimal upfront investment compared to opening a new physical store. 

However, it’s important to consider certain challenges, like managing website maintenance, handling returns, and competing in a crowded online market.

Your e-commerce platform is the foundation of your online store. It’s where you’ll display products, process payments, manage inventory, and handle customer orders. 

There are various platforms to choose from. Businesses often compare options based on factors like size, requirements, and budget. For example: 

• Shopify is an all-in-one platform that offers built-in payment processing, order tracking, and analysis tools. It can provide small businesses with a streamlined setup.
• Squarespace combines website design and e-commerce, offering built-in templates, SEO tools, and social media integration. It allows businesses to incorporate content and commerce in one place.
• Etsy is a marketplace for handmade, vintage, and craft products. It’s often used by creatives and those who want access to a built-in audience.

Once you’ve chosen a platform, it’s time to build your site. You can do this yourself using templates or hiring a designer or developer for a custom website. 

Many successful online shops include the following features: 

• Domain name – create a short, memorable web address that reflects your brand.
• Website design – use consistent colours, fonts, and layouts to create a professional look that appeals to your audience.
• Navigation – organise products into clear categories, using filters and search functions to help users find what they want.
• Product pages – include high-quality images, detailed descriptions, clear pricing, and customer reviews to help customers make informed decisions.
• Essential pages – add an ‘About’ page, contact information, shipping and returns policies, privacy policy, and terms of service. These pages build trust and may be required either by law for data protection (external link) or by payment processors. 

Using AI to build a website 

Many website builders now offer AI-powered tools to help you build a website, from design to content: 

• Website builders: Platforms like Wix and Hostinger use AI to ask you a few questions about your business, goals, and style preferences. They then generate a fully designed website tailored to your needs.
• Content generation: AI tools can write product descriptions, homepage copy, and even blog posts.
• Chatbots and customer support: AI-powered chat features can be embedded into your site to answer customer questions and collect feedback.
• SEO optimisation: Some platforms use AI to help you optimise your site for search engines, suggesting keywords, meta descriptions, and content improvements. 

Leveraging AI to build your website can help you save time and money when setting up an online store.

Being able to process payments securely is essential for any online store. To set up online payments, you’ll need a payment gateway. This is an intermediary service that helps to authorise and process transactions between businesses and customers. 

Popular options include: 

• PayPal: Easily integrated and widely trusted, letting customers pay using their PayPal balance or connected cards.
• Stripe: Supports various payment methods, including credit/debit cards and digital wallets.
• Shopify Payments: Built into Shopify, this option can simplify setup and eliminate third-party transaction fees. 

Most e-commerce platforms offer built-in support for these systems. You will also need to ensure your website uses Transport Layer Security (TLS) (external link)encryption to protect customer data during transactions. 

Small businesses selling physical goods can also pair their payment systems with secure delivery options, providing tracked shipping and estimated delivery times to boost customer confidence. 

You can read our guide for more information about online payment systems for SMEs.

Search Engine Optimisation (SEO) can help your online store appear in search engine results when users look for products like yours. Effective SEO for small businesses can drive traffic to your site without relying solely on paid ads.

There are various ways to optimise your site for SEO, including: 

• Keyword research: Identify the terms your target audience uses when searching for your products.
• On-page SEO: Use keywords naturally in product titles, descriptions, headings, and meta tags.
• Internal linking: Link between related products and pages to help users navigate your site and improve how search engines understand your content.
• Image optimisation: Use descriptive file names and alt text for product images to improve accessibility and visibility in image search results.
• Mobile-friendly design: Ensure your site works well for smartphones and tablets, as mobile usability is a key ranking factor.
• Fast load times: Compress images and streamline your site’s code to reduce loading times, which can affect both SEO and user experience. 

Regularly updating your site with new content, including blog posts, product pages, and customer reviews, can also help improve your rankings over time.

Social media can be a powerful and cost-effective marketing tool. Platforms like Instagram, Facebook, X (formerly Twitter), and TikTok allow small businesses to increase brand awareness and engage with customers by showcasing products, sharing updates, and building a community around their brand. 

Which platform you use can depend on your audience and product type. For example: 

• Instagram and TikTok can be ideal for visual products and younger audiences.
• Facebook can generate community engagement and offers features like Facebook Marketplace for direct selling.
• Pinterest can work well for lifestyle and design-related products. 

Many platforms now incorporate social commerce, allowing users to browse and purchase products within the app. Features such as product tagging, live shopping, and integrated checkout can streamline the buying process and potentially boost conversions.

Launching an online store is a learning curve that often requires a lot of trial and error. Here are some common pitfalls to look out for: 

• Poor product descriptions: Poorly worded or incomplete descriptions can confuse customers and lose sales. Clear, detailed content can help users make informed decisions.
• Low-quality images: A lack of clear product photos can damage customer trust. High-quality images can help to showcase your products.
• Ignoring mobile users: Sites that don’t function properly on mobile devices can disengage users. Ensure your site is fully responsive.
• Complicated checkout process: Too many steps or required fields can lose potential buyers. Keep the checkout simple and user-friendly.
• Lack of clear policies: Missing or unclear shipping, returns, and privacy policies can damage customer trust. Ensure you are transparent.
• Neglecting SEO and marketing: Without visibility, even great products won’t sell. Invest time in SEO and marketing. 

Launching an online store for your small business is a process. Understanding what e-commerce platform is right for you, how users engage with digital marketplaces, and why SEO is important can help you get started.