Why start an online store in 2022

Have you ever mused about starting an online store? Maybe you are looking for a way to monetize your hobby or want to bring your offline shop into the digital world. But regardless of your motives, you are most likely wondering if it is worth the effort.

Well, the short answer to this question will be yes. You should at least try. But why is 2022 a good year to do it? Isn’t it too risky to launch a new business in such unstable circumstances? And how to start your own online store, in general?

Let’s dive into the topic and answer these questions.

Why start an online store in 2022

2022 is one of the best years to start an online business. The e-commerce market is booming and won’t stop anytime soon. We have a lot of opportunities to enter the field with a low budget. And the internet is flooded with various helpful information about business development.

But first things first.

Reason #1. Market is growing

Statistics say that e-commerce is booming. In 2020, the pandemic allowed this branch to develop 5 times faster than before. And the steady growth of this industry is still maintained. Here are some examples:

• In 2020, global e-commerce sales reached 4.28 trillion US dollars. And Statista forecasts that it will grow to 5.4 trillion US dollars in 2022.
• In 2021, over 2.14 billion people were buying goods and services online. For comparison, there were only 1.66 billion global digital buyers in 2016. And gen-Z will definitely increase this number even more.
• According to the forecast, e-commerce will account for up to 95% of sales by 2040.

The main trends are showing that the market will continue to grow. Thus, there is a lot of space for new businesses and possibilities for you to grow together with online retail.

Reason #2. It is easy to get started

Today, opening an online store is easier than ever. We have a wide range of different opportunities: from creating an account on marketplaces to fully customizable e-commerce platforms. And the internet is flooded with content about working with these tools and developing your new business online. You can easily find the answer to any question and get support from the other entrepreneurs.

Reason #3. E-commerce is profitable

The final reason to start an online store in 2022 is its potential profitability. Here are some data about how much a new online store can earn:

• In the first month, your revenue will be below $39,000
• After 3 months, you will start earning around $63,000 monthly
• In a year, this number will increase to $127,000 of monthly revenue
• And after three successful years in a row, you will get $352,000 of monthly revenue

Impressive, isn’t it? I would say that the e-commerce business can be highly profitable.

But…

How much does it cost to start an online store?

The main resource that you need to start your online store is your time. The more time and effort you are ready to spend developing a business, the less money you will need. Under certain conditions, you can even create an online store for free. For example, if you choose a dropshipping business model and run your website on a free e-commerce platform with free hosting. Unfortunately, this case is close to impossible, at least because you’ll need to switch to paid hosting quite soon. But in general, the e-commerce market has low entry barriers.

The total cost of creating an online store consists of the following:

• Business registration fee. Depending on the country where your business is located, its type of ownership, and other law-related factors, the registration fee, and other legacy costs may vary widely.
• Hosting and domain name. As I already mentioned above, you can start with a free hosting solution. But there is always a good chance that your store will outgrow it in a couple of months, and you will need to migrate the website to a new server.
• E-commerce platform. 10+ different platforms are suitable for online stores. Some of them are available for free others — charge a fee. What solution you should choose is one of the most important questions in this journey because each of them has its pros and cons. This step can be one of the most expensive. You may need to pay for not only the platform itself but for custom solutions, theme design, ERP integrations, etc.
• Stock. Finally, you need to sell something in your store. Depending on your business model, you need to rent a warehouse and fill it with goods. Or you can find reliable dropshippers that will store products in their own stocks. This way, you can start an online store without inventory.

The final cost may be anywhere from $1000 — $100,000 and depends on your business and its features.

How to start an online store?

Say you made up your mind to start an online clothing store. To do this, you need to choose your business strategy, create a unique offer, find the most suitable e-commerce platform, and build your website. That sounds like a lot, but moving one step at a time, you can do it.

Here are detailed steps you need to follow:

1. Choose your business strategy. Do you want to take care of the warehouse? Do you want to build your brand and promote yourself as a fashion designer? Or do you want to let users subscribe to a new pair of socks every week? Or maybe you are looking at how to start an online thrift store? There are many different ways you can run and monetize your store. Choose the one that suits you best.
2. Determine what will stand you out of the crowd. There are thousands of different online shops. Why should users choose yours? Answering this question will help you develop your unique offer.
3. Choose your e-commerce platform. The only advice I can give you is to think twice before choosing a platform. Of course, it is possible to migrate your store from Shopify to Magento 2, for example, but it will cost a lot of effort.
4. Build your online store. This step can take the most time. I believe that building your online store is like building a house, a process that never stops. But at the very beginning, you can implement the most necessary features only.

After this, you can dive deeper into marketing and branding, but these 4 steps will help you start.

And that’s all, but only for my today’s article, because for your business, this is just the beginning.