How much does it cost to set up an online shop?

There are all kinds of e-commerce sites out there, ranging from simple shop windows for a handful of products to powerful platforms used by thousands of customers. Obviously the bigger and more complex a site is, the more expensive it will be to build and run. The biggest factors affecting the cost of an online shop are the number of products, the available features, and the underlying infrastructure. Let’s take a closer look at the different costs and what you need to consider.

To successfully sell products online, you need the right software, and this is a significant factor when it comes to calculating the cost of an online shop. When looking for a solution, it’s important to think about your specific requirements, and in particular the following factors:

Are you happy with a classic design with a simple header, navigation bar, filters, and product pages? Or do you want to be able to customise specific features? If you want a custom design, you’ll need to pay an agency or freelancer to create your site, and you also need to make sure the software you pick is compatible with the design.

Even the simplest, cheapest e-commerce solutions come with basic features like a navigation system, filters, and a shopping trolley. If you want more than this, however, you’ll need a more powerful (and often more expensive) solution, or you might have to hire a developer to design and develop the additional features. The most complex and expensive sites are those that include a product configurator that lets customers customise their order.

Will you be selling 10 products or 1,000? Are you going to have to write product descriptions and take photos yourself (for example, if you’re selling homemade products, or can you get all of this from the manufacturer?

People often underestimate the cost of creating content for an online shop. You’ll need at least one good photo of each product – probably more. You’ll also need compelling product descriptions and detailed information (known as master data and attributes) for each item. Some sellers prefer to hire a freelancer or specialised agency to create content for their site. Agencies can offer quicker turnaround times and high quality as they usually have a whole team of content experts on hand.

If you’re selling a lot of products, outsourcing content creation can save you time and money, although costs do vary a lot (depending on quality requirements). Of course, if you’re selling another company’s products rather than you own and can get all the necessary content from the manufacturer, the costs will be lower.

The number of products and type of content don’t directly affect what online shop system you can use, but they do affect the following two factors – both of which have implications for the cost of your online shop. Let’s take a closer look.

Many shop systems allow you to manage and update your photos, product descriptions and other data directly in the backend. However, if you’ve got a lot of content to manage, it might make more sense to import it as a CSV file or connect a database, such as an Enterprise Resource Planning (ERP) system.

Are you going to be selling your products overseas? If so, you’ll need to create and shop content in several languages. And in fact, even if all your customers are in English-speaking countries, you might still want to create different versions for the UK, the USA, Australia, New Zealand and so on. Make sure that whatever software you choose lets you configure different languages.

Some online shop solutions come with built-in options for online payments, invoicing and shipping. Alternatively, you’ll need to use external apps or plugins to handle aspects like checkout and shipping.

It should now be clear that the level of customisation you require is a key factor in determining what solution works for you and how much it will cost to start your online shop. The cheapest option is of course a standard off-the-shelf solution. The second key factor when it comes to cost is how many products you want to sell.

If you’re unsure about either of these points, it might be worth consulting an expert. Both agencies and freelance consultants can help you work out how much it will cost to build an online shop and select the best software. They can also advise on how to set up your online shop and help with running it further down the line. Independent consultants usually charge an hourly rate, starting at around £70. For advice on choosing a system and a cost estimation, you should allow for at least two days.

When choosing software, you’ll want to think about scalability too. Lots of people start small, and that’s great. But it’s good to plan for the future too. Perhaps you’ll want to branch out into other sectors, expand your customer base or customise certain features, for example. To avoid unnecessary hassle, choose a solution that you can easily upgrade when the time comes.

If you want to open an online shop, you basically have three options:

• An online shop builder or ready-made online shop which you rent on a monthly basis;
• A flexible open-source solution, many of which have a basic free version; or
• A proprietary e-commerce platform or enterprise solution, available through a licensing agreement.

Online shop builders and rented solutions are ideal for small business owners with limited web expertise. The software is designed to be user-friendly and comes with a range of basic features, and there’s usually a support team on hand to help with any questions. As well as the actual shop, the package often includes a domain and/or a standard website and hosting. The cost of this type of solution starts at around £20 per month, plus any content creation and setup costs.

Open-source solutions are a popular choice for small- and medium-sized shops that require a certain degree of customisation in terms of design and features. One of the most popular options is to run an online shop on a WordPress site using a plugin such as WooCommerce or Shopify. Open-source solutions are usually free or very cheap, but you’ll pay extra for plugins and additional features. On the other hand, you get a lot of freedom when it comes to design and customisation.

It’s difficult to calculate all the different costs in advance, but for a medium-sized shop you can expect to pay a few thousand pounds in initial costs (design, configuration, content, and so on). Running costs on the other hand are very low, or sometimes even non-existent.

This kind of software is aimed at big companies running large-scale e-commerce websites, i.e., brands with an extensive product portfolio, huge customer database, and/or complex system requirements such as inventory management and shipping software or a returns portal. OXID eShop and Magento are both popular choices. In terms of price, at the lower end of the scale you have Shopware, and at the top end SAP Hybris Commerce.

Different providers offer different payment models – for some you pay a one-off fee to purchase the software, and for others you pay a monthly licensing fee. Entry-level packages start at a few thousand pounds, but for the most powerful solutions, you can easily pay upwards of £15,000 – and remember, this doesn’t include setup or content creation costs!

For a comprehensive overview of the different solutions available and their main advantages and disadvantages, check out our e-commerce platform comparison.

We’ve talked about how much it costs to create an online shop, configure it, and create content, but what other costs do you need to consider?

If you don’t use a ready-made template, design costs for a site and all its sub-pages can quickly escalate, reaching several thousand pounds.

Even if you’re just starting out in the e-commerce world, you might want to invest in advanced features from the word go. Bear in mind that purchasing, setting up, and connecting external systems for inventory management, checkout, shipping, marketing, customer service and so on can be very expensive. Software packages for inventory management and shipping alone can cost anywhere from a few hundred pounds to more than £20,000. The more expensive options include features like invoice generation, reminders, and tools to manage product and customer data.

If you’re producing and shipping products yourself, you’ll also need suitable storage facilities and packaging materials, and you may need to hire staff. Alternatively, you can arrange for this to be done by a fulfilment company or dropshipping provider.

Every country has its own rules and regulations regarding data protection and consumer rights, and things get even more complicated if you’re selling overseas. Be sure to seek expert advice on things like cookie banners, the collection and processing of customer data and documents such as your T&Cs and privacy policy.

Anyone running an online shop also needs to consider search engine optimisation, ads, and other online marketing strategies. Depending on your target audience, needs and budget, you might be able to handle marketing yourself, or you might want to outsource this to a freelancer or agency.

Whether you’re running your shop alone or with the help of a consultant or agency, there is always something to be done, whether that’s adding new product data or features or fixing bugs. Make sure you budget enough time – and money – for this from the outset, especially if you’re a beginner. You can always adjust things later on when you have more experience.

Another decision you’ll need to make that affects costs is whether you’re going to run your shop by yourself or with the help of a freelancer or an agency. Here are a few things to think about:

• If you’re tech-savvy, you can deal with some of the programming, design, and content yourself, and then hire a freelancer to do the remaining tasks. Alternatively, you could hire someone to take on the whole project and just act as a coordinator yourself.
• Freelancers often charge less than agencies and can provide a one-to-one service for as long as you need.
• If you need the help of several different experts, it might be better to go to an agency as they’ll be able to pull together a team and coordinate things for you.
• You could of course recruit your own team to build and run your shop, but don’t forget that recruiting and managing staff will take time and money.