How Much Does It Cost To Start An Ecommerce Platform? (In 2024)
Looking to start an ecommerce platform?
But curious about:
- how much it costs to start an ecommerce platform?
- what are the typical ecommerce platform startup costs?
- or the actual cost of starting ecommerce platforms?
Well, we have the data to prove it, supported by real ecommerce platforms and how much they actually cost to start.
Let's go over it.
What is the average cost of starting an ecommerce platform?
Based on our data reported by actual ecommerce platform founders, the average cost of starting an ecommerce platform is between $20 and $3,000,000.
Additionally, our data shows that the the median startup costs for an ecommerce platform are around $25K.
Remember, though, not all ecommerce platforms are the same - and neither are people's budgets. It's important to distinguish between different levels or types of ecommerce platforms
Real World Examples: How much does it cost to start an ecommerce platform?
We asked real ecommerce platform founders and business owners how much it actually cost to get started?
Here is what they said:
Jean-Loup Karst
Founder of Secret ($18K/month)
"However, at the time we started, all of the cofounders added $1,200 each in capital. That was very little given our needs in terms of design, front-end development, etc."
Jean-Loup Karst is the co-founder of Secret, a platform offering exclusive deals on services and software for startups, helping entrepreneurs save money on essential business tools.
Eyal
Founder of StoreYa ($2M/month)
"We raised a seed round of ~$900K when we first started and for the past 3 years, we've been profitable, generating an average of $700K MRR."
Eyal Reich is the co-founder of StoreYa, a marketing and advertising platform for SMBs that helps more than 200,000 online sellers increase sales, leads, and social following.
Scott Tarcy
Founder of caddesignhelp.com ($8K/month)
"I funded my business through my own savings. My main costs were: Computer - $2,000, Software - $5,000, 3D printers - about $20,000. I purchased these over time. I didn’t buy it all at once. I more or less bought these items when it became clear I would invest back quickly."
Scott Tarcy is the founder of CADdesignhelp.com, a CAD design and prototyping business that started in 2015 and averages about $9,000 per month in revenue.
Eric Mitz
Founder of The Clunker Junker ($491K/month)
"All in all the initial investment for the original website was about $20 for a domain and some cheap shared hosting."
Eric and Valerie Mitz are the founders of The Clunker Junker Cash For Cars, a junk car removal service that has grown to generate close to $6 million in revenue in 2020 with a net profit of $4.1 million.
Mr. Varghese Samuel
Founder of KOGLAND Commerce Pvt Ltd ($30K/month)
"The MVP took just 2 weeks to build and cost only $400. I registered the domain and it cost $12.99. It really didn't cost much."
Varghese Samuel is the founder of KOGLAND Commerce Pvt Ltd, a healthcare supplies e-commerce platform that efficiently solves the industry's supply chain challenges.
Kola Tytler
Founder of Dropout SRL ($140K/month)
“Funds used were completely from the savings of myself and my business partners, who thankfully believed in the project as much as I did. Pretty much the entire amount is invested came from savings made by the previous stocking and reselling of sneakers.”
Kola Tytler is the founder of dropout, a retail business in Italy that focuses on the sale of limited edition sneakers and streetwear.
Brian McEuen
Founder of On Brand ($150/month)
"I recently launched our MVP with On Brand." "It took just 2 weeks to build and cost $400. I registered the domain and it cost $12.99. It really didn't cost much."
Brian McEuen is the founder of On Brand, a personalized clothing curation service designed to help men shop for clothes online with a Spotify-like experience.
Enjoyed reading these real world examples?
Our platform is full of case studies of successful ecommerce platforms that you can learn from.
Starting an ecommerce platform - what you should know:
Launching an ecommerce platform involves various factors that can significantly affect costs:
Domain and Hosting
The cost of a domain name generally ranges from $10 to $50 per year. Hosting services can vary widely; shared hosting may cost between $3 to $10 per month, while dedicated hosting can range from $80 to over $300 per month. Choosing the right hosting plan will depend on your site's expected traffic and technical requirements.
Website Development and Design
Basic ecommerce website development can start at around $2,000 to $5,000. Custom-designed sites with advanced features, however, can cost anywhere from $10,000 to $50,000 or more. Using pre-built ecommerce platforms such as Shopify or WooCommerce can lower initial costs, with pricing starting at around $30 per month.
Payment Processing
Payment processing fees typically consist of a percentage per transaction plus a fixed fee. Providers like PayPal and Stripe charge around 2.9% + $0.30 per transaction for domestic transactions in the United States. Be sure to account for these costs, especially if you plan on high-volume sales.
Marketing and Advertising
Initial marketing and advertising expenses can quickly add up. Pay-Per-Click (PPC) campaigns often require a monthly budget of at least $500 to $5,000. Email marketing services may cost between $20 to $300 per month, depending on your subscriber list size. Allocating a budget for SEO and social media marketing is also advisable, potentially costing $2,000 to $10,000 monthly if you hire outside agencies.
Inventory and Fulfillment
The cost of inventory will vary depending on the products you sell. Dropshipping minimizes upfront inventory costs but can lead to higher unit prices. In-house fulfillment requires warehousing, which can cost between $5 to $15 per square foot annually, plus additional staffing costs.
By understanding these components, you can better plan and budget for launching your ecommerce platform.
Potential Costs of Starting an Ecommerce Platform
Starting an ecommerce platform involves various costs, from initial setup to ongoing maintenance, that vary depending on the size and complexity of the store. Below is a detailed breakdown of potential costs.
| Expense Category | Specific Costs | Estimated Cost Range |
|---|---|---|
| Domain | Domain registration | $10 - $50/year |
| Hosting | Shared hosting | $3 - $10/month |
| VPS hosting | $20 - $100/month | |
| Dedicated server hosting | $100 - $500/month | |
| Cloud hosting | $50 - $300/month | |
| Website Development | DIY website builder (e.g., Wix, Shopify) | $29 - $299/month |
| Professional web developer/agency | $1,000 - $10,000+ one-time | |
| SSL Certificate | Basic SSL certificate | Free - $100/year |
| Advanced SSL certificate | $150 - $600/year | |
| Ecommerce Platform | Open-source platform (e.g., WooCommerce) | Free (excluding plugins) |
| Subscription-based platform (e.g., Shopify) | $29 - $299/month | |
| Enterprise solutions (e.g., Magento) | $22,000 - $75,000/year | |
| Payment Processing Fees | Credit card transaction fees | 2.9% + $0.30 per transaction |
| Payment gateway setup fee | $0 - $250 | |
| Themes and Templates | Basic theme | $0 - $100 one-time |
| Premium theme | $100 - $300 one-time | |
| Plugins/Add-ons | Basic plugins (SEO, security, etc.) | $0 - $100/year each |
| Advanced functionality plugins | $100 - $500/year each | |
| Inventory Management | Inventory software | $20 - $100/month |
| Marketing | Initial marketing budget | $200 - $2,000/month |
| SEO services | $500 - $5,000/month | |
| Email marketing tools | $20 - $300/month | |
| Shipping and Fulfillment | Shipping setup (software, materials) | $50 - $500 one-time |
| Fulfillment services | Variable - based on volume | |
| Customer Support | Customer service software | $20 - $100/month |
| Hiring support staff | $2,000 - $5,000/month | |
| Legal and Accounting | Legal services (e.g., incorporating) | $500 - $2,000 one-time |
| Accounting software | $20 - $50/month | |
| Hiring accountant | $300 - $2,000/month | |
| Miscellaneous | Office supplies, utilities, etc. | Variable |
| Total Initial Costs | Combining setup costs | $2,000 - $20,000+ one-time |
| Total Ongoing Costs | Ongoing monthly expenses | $500 - $10,000+/month |
Understanding and preparing for these costs can help ensure you have the necessary budget to successfully launch and maintain your ecommerce platform.
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Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
