For your business7 min read

How to start an online store from scratch

Starting an online store is dramatically easier than it was a decade ago — and dramatically more competitive. Here's the realistic path from product idea to your first 100 orders, with honest numbers about what most stores actually earn.

Quick answer

Starting an online store takes 4–8 weeks and £500–£3,000 of startup costs (platform fees, initial inventory, basic marketing). The hard parts aren't the technology — they're product selection, traffic acquisition, and unit economics. Most first-year stores earn under £15,000 because they pick saturated products or can't crack traffic; focused stores with distinctive products and clear customer acquisition earn £30,000–£150,000+ in year 1, scaling significantly from year 2.

Step-by-step

Pick the right product (the single biggest decision)

Product selection determines 80% of store outcomes. Three rules. Niche specificity beats broad appeal (a store for 'left-handed knitters' beats a generic 'knitting supplies' store). Product margin must work at scale (selling £25 products with £4 product cost is sustainable; selling £25 products with £18 product cost isn't). Product must be hard to find at scale on Amazon and standard retailers (you can't beat Amazon on commodity products). The best beginner products: handmade or self-designed items, niche specialisation of an existing category, products with clear lifestyle stories.

Choose the right platform

Three legitimate paths for new stores in 2026. Shopify (the default for serious stores — £25–£399/month, robust ecosystem, easy to learn). Etsy (lowest friction, best for handmade and niche products, 6.5% transaction + listing fees, capped long-term). Adviita with e-commerce integration or WooCommerce on WordPress (best for stores that grow into content-led commerce). Pick Shopify for a serious store from day one; Etsy for testing demand with low setup friction. Don't try to build custom — you'll spend months on infrastructure instead of selling.

Get legal and operational setup

Register as a sole trader (UK: free, 10 minutes online) or LLC (US: $50–$200). Set up business bank account. Understand sales tax obligations (UK VAT threshold £85k; US sales tax varies by state). Set up basic accounting from day one (Xero, QuickBooks, or FreeAgent). Get appropriate insurance (product liability £80–£250/year). Open a clear returns process. Most e-commerce businesses fail on operational and tax chaos in year 2; getting systems right from day one prevents this.

Price for unit economics that work at scale

The most common store-killing mistake: pricing that works at low volume but breaks at scale. Calculate your true cost per unit: product cost + shipping cost + payment processing (2–3%) + platform fees + customer acquisition cost (often £8–£25 per customer in paid acquisition) + returns cost + your time per order. Most successful stores price at 3–5x product cost — selling a £8-cost product for £30+. If your margin can't support paid customer acquisition AND your time, the store won't scale.

Get your first 100 orders

Your first 100 orders come from three channels in this order. Personal network (friends, family, social network — your first 20–40 orders). Free organic content (Instagram, TikTok, Pinterest, niche communities — your next 40–60 orders over months 3–6). Paid acquisition (Facebook/Instagram ads, Google shopping — orders 60–100+ once your conversion rate and product validate). Don't run paid ads in month 1 — your store isn't optimised yet and you'll burn budget. Build organic foundation first, layer paid acquisition once organic converts.

Build email and SMS for repeat customers

Repeat customers are the only path to a sustainable e-commerce business — first-purchase economics rarely work after acquisition costs. Build email and SMS lists aggressively from day one. Three moves. Welcome offer for first email signups (10–15% off first order). Post-purchase email sequences thanking customers and asking for reviews. Abandoned cart sequences (typically recover 10–20% of abandoned checkouts). Top e-commerce stores earn 30–60% of revenue from email/SMS marketing to existing customers.

Track real economics, not vanity metrics

After your first 100 orders, the work shifts from selling to running a real business. Track: contribution margin per order (revenue minus product cost minus shipping minus payment fees), customer acquisition cost (CAC), lifetime value (LTV), and the ratio of LTV to CAC (should be at least 3:1 for sustainable growth). Stores that ignore unit economics scale into losses; stores that track religiously make sustainable decisions about which products to push, which channels to invest in, and when to raise prices.

Tips & best practices

▸Photography is your single biggest conversion lever. Either learn it yourself or invest in 2–3 professional shoots a year — bad photography kills conversion regardless of product quality.
▸Test products in low volume before committing to inventory. Pre-orders, made-to-order, or small drops let you validate demand before sinking £5,000+ into inventory that might not sell.
▸Build a clear brand voice (founder story, values, distinct visual identity). Generic commodity stores compete on price and lose; branded stores command premium and build loyalty.

Common questions

How much can a first-year online store realistically earn?

Most first-year stores: £2,000–£15,000 revenue (often losing money after costs). Focused stores with distinctive products and clear customer acquisition: £30,000–£150,000 revenue. Top first-year stores with strong creator presence or unique products: £200,000–£800,000+. Year 2 typically 3–5x year 1 for stores that survive.

Shopify, Etsy, or build my own?

Shopify for serious stores from day one. Etsy for fastest setup with handmade/niche products. Don't build custom — the infrastructure work distracts from product and marketing. Most stores starting in 2026 should use Shopify or Etsy until they have £100k+ revenue.

Do I need to invest in inventory upfront?

Not always. Made-to-order, print-on-demand, dropshipping, and pre-orders all let you start with minimal inventory investment. Pre-orders are particularly powerful — you can validate demand for a £15,000 inventory order with a £3,000 pre-order campaign that funds the production.

What's the biggest mistake new e-commerce stores make?

Picking saturated products competing on price with Amazon. Generic 'phone case shop' or 'jewellery store' competing with global mass-market produces zero revenue. Specific niche products with clear story, distinct design, and target customer build sustainable stores.