How to start an e-commerce business in India?

Are you looking to start your own e-commerce business? Or do you want to revamp your existing business?

If the answer to both the questions is yes and you have been dreaming about diving into the vast ocean of e-commerce to explore its immense and limitless possibilities then you are at the right place. This step-by-step guide will help you gather inputs and insights on the fundamentals of e-commerce and help you with the proper knowledge and understanding of how to start an e-commerce business in India.

What is an E-commerce business?

E-commerce or electronic commerce refers to all types of transactions of goods and services done via the medium of the internet. In common terms, e-commerce is an online process of buying or selling goods and services. Whenever anyone buys or sells any kind of product or service online it is called engaging in an e-commerce business.

The e-commerce industry is growing at a very fast pace worldwide and in India, it is entering into the next phase of transformation offering exponential growth and opportunities.

According to a recent report it is estimated that India’s e-commerce industry is expected to grow to the tune of $84 billion by the end of 2021. The main reasons and driving force behind it are the increasing number of mobile phone users, cheaper mobile-data plans, and higher internet penetration resulting in higher reach.

Moreover, after witnessing the huge success of Amazon, Flipkart, and Snapdeal in the Indian markets, more people and businesses are ready to dive into the deep ocean of e-commerce for experiment and try their luck in this ever-increasing market of e-commerce with the dream to make it big.

Building your own e-commerce business for profitability and success is as exciting as it is challenging but the results are pretty bountiful.

The Benefits of E-Commerce

E-commerce business offers a tremendous set of benefits like 24×7 access to consumers for an easy, convenient, and hassle-free shopping experience with no paperwork and extra costs incurred on physical marketing and advertisements. Plus, you can update and modify it accordingly to make it more user–friendly.

Here goes the list of benefits from e-commerce

  • 24×7 access to customers
  • Global reach
  • Convenience
  • Faster buying process
  • Cost reduction
  • Affordable advertising and marketing
  • Wide range of goods and services
  • No storage limits
  • Product and price comparison
  • Faster response to market demands.

How to start an e-commerce business in India

Here is the step-by-step guide on how to start a successful e-commerce business in India in 2021.

  1. Define your business name
  2. Set domain name
  3. Design your e-commerce website
  4. Set up payment gateway
  5. Find the right business plan and model
  6. Register your Ecommerce Business in India
  7. Employer Identification Number (EIN)
  8. Find Logistics Partners and vendors
  9. Keep Inventory ready
  10. Market your Ecommerce Business
  11. Compliance

Define your business name

The name of the business plays a very significant role in defining the legal identity of your business. Thus, it has to be unique yet simple for the consumer to relate with.

Set domain name

One of the most crucial and deciding factors for an e-commerce business plan is its website name.

The business name acts as your domain name also and thus has to be unique yet simple.

Domain name system (DNS) stipulates the website address that you want to keep.

A website plays a vital role and acts as the first point of contact between you and the customers. It is accessible to numerous people at any given point in time and provides information about your existence in the vast market.

It is also useful for developing effective marketing strategies for future growth and success and helps in creating credibility.

Design your Ecommerce Website

E-commerce cannot work without a website as it will be the front face of your company as it is what your customers will first see and use to buy goods or services.

The website facilitates an opportunity to build up your brand image, create a solid customer base, and gather necessary user data.

For that, you need to hire a professional technical team to develop your e-commerce website, a marketing team to help you with marketing, promotions, and SEO.

There are numerous things to consider and questions to ask, before choosing your technical partner. Getting this right will have an impact on the success of your business.

  • Understanding your business goals
  • Expertise in e-commerce
  • Technology Expertise
  • Skilled & Experienced Team
  • Work-process
  • Reliability
  • Scalability
  • Ability to grow together

If you want help with designing an e-commerce store, you can hire a professional ecommerce website developer who can deliver the digital solution quickly.

Set up payment gateways

The payment gateway is mandatory for an e-commerce website to process customer payments. The payment gateway provides the website to accept multiple payment options like net banking, credit cards, debit cards, and e-wallets from multiple banks for smooth business transactions.

You must determine which payment method would suit you best and appeal to your customers also at the same time. It is a vital step in achieving profitability and success in your e-commerce business.

Find the right business plan and model

Types of E-commerce Models are as follows. You can choose anyone accordingly: –

  1. Business to Business (B2B)
  2. Business to Consumer (B2C)
  3. Consumer to Consumer (C2C)
  4. Consumer to Business (C2B)

Business to Business (B2B)

Business to business (B2B) model refers to providing products or services from one business to the other business. It is a very common type of business model and many industries practice this worldwide like software companies developing applications for other companies, logistics companies providing transporting services to other companies.

Business to Consumer (B2C)

Business to consumer or B2C is the same as the traditional retail model where the businesses sell products or services directly to the consumers. When a customer buys a product from an e-commerce site and receives those products it falls under the B2C business model.

Consumer to Consumer (C2C)

This kind of business involves direct Consumer to Consumer (C2C) interaction for a business perspective using a marketplace to buy, sell and trade items in exchange for a little commission paid to the site. The best examples are eBay and olx where individuals sell pre-owned household items and vehicles to other consumers.

Consumer to Business (C2B)

Consumer to Business (C2B) is a kind of business model where highly skilled individuals try to make money by providing their skills as a service to different businesses. The best example of it is freelancing services. There are many platforms available where professionals can easily auction their services and monetize them like Fiverr, and Upwork.

Register your Ecommerce Business in India

While starting an e-commerce business it is mandatory to register your business in India as a company or LLP to have limited liability protection for easy facilitation of business procedures and transactions.

If the promoters want to start a proprietary e-commerce website, then it is best to start with a Company, as this type of entity has the provision of investment through angel funding or equity funding for the growth and success of your e-commerce business.

Employer Identification Number (EIN)

You cannot operate an e-commerce business without a bank account. Employer Identification Number (EIN) provided by the Govt. of India and is a unique identification number that facilitates you in getting a bank account number for your e-commerce business in India. This number is used to file your taxes incurred in the business and is the fundamental requirement for running any e-commerce business operations in India.

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Find Logistics Partners and vendors

It is nearly impossible to operate your e-commerce business without vendors and logistic partners. It becomes an utterly crucial factor to identify and keep the list of contacts of different vendors to get the best quality and prices for the materials you are interested to sell on your website. You must do an extensive search for reliable and trustworthy vendors to help you establish your brand and reputation in the business sphere.

Likewise, choosing a best-suited logistics partner is critical for your e-commerce business because it is one of the key factors that help in providing you with a consistent and sufficient flow of goods. When selecting a logistics partner, the company must be capable of delivering salable products that too on time and in good condition.

Maintaining a proper record of all the logistics will be very helpful in preventing the loss of goods and thus will be helpful in assisting you to carry out the order and delivery operations quite effectively and responding well to consumer inquiries about the planned delivery.

Considering the above-mentioned factors and with an abundance of choices, it is very important to screen and finalize the right logistics partner through the following criteria:

  • Price
  • Technology
  • Freight
  • Scalability
  • Customer Service

Keep inventory Ready

Inventory will help you track the information that you need. Ensure the warehouse (store) has enough products so that customers don’t miss out on what they want. You may not be in a position to tell what will be needed when but is always safe to keep stock. This will help keep track of the orders you make in the future.

Market your Ecommerce Business

Once your product is ready to go in the market, you need to analyze your product and its potential buyers before listing it on the marketplace. The top marketplaces already have a huge customer base, market share, and a strong online presence. This can help you to start selling your product with minimal marketing efforts and the opportunity to compete with big brands, also you don’t have to worry about logistics as most of the marketplace provides logistics support.

Things to consider before choosing a marketplace for your e-commerce business are as follows: –

  • Evaluate your product
  • Popularity of marketplace
  • Online presence of marketplace
  • The fan base of the marketplace
  • Logistics and shipment support
  • Marketing support
  • Competition

There are basically two kinds of business models for finding the marketplace for your business respectively:

  1. Single-vendor marketplace
  2. Multi-vendor marketplace

Single-vendor marketplace

A single-vendor marketplace is a kind of e-commerce business model that involves two entities – a single seller who is selling his product to multiple customers. It is not only easier to keep track of the transactions between the two entities, administrative costs are lower when you have to pay just one supplier, and you also have more control over the inventory at hand.

Multi-vendor marketplace

This kind of model involves multiple vendors selling their products to multiple customers. All the vendors need to get registered with your site.


Compliance is the most key factor for running a successful business. Always be smart with deadlines in terms of taxes, licenses and permits needed. Even after following all the steps if you fail to comply with your business rules and regulations, the businesses’ reputation will be at stake. So, always ensure to abide by the law.


E-commerce involves the sales of goods and services over online platforms using internet services.

It is a revolutionary and magnificent field offering a plethora of possibilities and opportunities for everyone.

It has changed the face of the shopping experience by making it easy, convenient, and hassle-free where one gets the liberty to pick, choose and order the desired products sitting right at the comfort of his home.

This simple step-by-step guide will help anyone interested to explore the opportunities in the vast field of e-commerce for smooth sailing.
Anyone interested in starting his own e-commerce business can gather extensive information and applied knowledge by enrolling in any prestigious digital marketing

Course in Jaipur for achieving profit and success in his e-commerce business.

Frequently Asked Questions (FAQ)

What are the benefits of an e-commerce business?

There are many benefits of doing an e-commerce business-like

  1. Global reach
  2. 24×7 access
  3. Low investment
  4. Convenience
  5. Fast buying Process
  6. No storage limits

Who are the major e-commerce players in India?

The big bulls of e-commerce of Indian markets include

  1. Amazon India
  2. Flipkart
  3. Snapdeal
  4. PayTM
  5. Indiamart
  6. Nykaa
  7. Jiomart

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