Thinking of starting an e-commerce business?  For many entrepreneurs, the idea of starting a digital storefront is exciting and if executed well, can be a lucrative and rewarding pursuit. But if you don’t know where to start — and you don’t have a lot of money — it can be a daunting task. But with the right mindset, a few resources and a lot of perseverance, it can be an adventure that’s well worth the undertaking.

Before you start, here are a few tips to help you get off the ground and start that e-commerce business of your dreams — even if you have limited funds.

Determine what to sell

Perhaps the most important decision is figuring out what exactly you should sell. Of course, your areas of interest and expertise should absolutely be factors in your selection process — if you are an expert knitter, you probably already have your Etsy shopped sketched out. Additionally, consider the feasibility of creating the product, the market saturation and the total costs of your product idea.

If you plan to create a new product, consider what may pose an opportunity for improvement. Consider areas in your life that could be improved with a simple product. Then, consider how difficult that product is to design and create and start brainstorming.

If inventing a product from scratch isn’t for you, consider dropshipping. This is essentially an e-commerce business model where you sell products to customers without stocking the items themselves. If you want to sell clothing with an original design, you would list the products on your online storefront and contract a third-party company to print and ship the product directly to customers. For business owners with limit funds, this eliminates the need for a lot of inventory.

Legal requirements

Once you’ve decided what to sell, it’s time to get legal. Most entrepreneurs just want to get out there and start selling, but it’s important to make sure your business is legal. The SBA provides a helpful checklist of steps to start your business, complete with resources provided for businesses like yours. Before getting too far ahead with your business, you must choose and fill out paperwork as a specific business structure, register your business name, get a Tax ID, register with tax authorities, apply for permits and licenses if applicable, and follow the correct procedures if you plan to hire employees. It’s a good idea to get all of the nitty-gritty legal details out of the way before you set sail.

Find the right supplier

Depending on your product, finding the right supplier for a good price may be one of the most difficult parts of running your e-commerce business. Though you’re on a shoestring budget, it’s important to remember: Price is not everything when it comes to picking a supplier.  You want to find a vendor that’s reliable, competent, and based in a convenient location. A great supplier will consistently deliver your products on-time according to the quality promised.

There may be different best practices when finding the right supplier depending on your product and location. For example, you may be able to produce and ship a line of t-shirts domestically while shoes may need to be made in China and delivered to a domestic distributor. Start with a cursory Google search for steps to producing your desired product and then begin shopping around for reviews of known suppliers in your space.

If you’re not manufacturing an original product, look into dropshipping options in your space.

Website vs. marketplace

Even if you’re tech-savvy, the thought of building an e-commerce site from scratch without first proving the concept is a tough pill to swallow. For this reason, many e-commerce businesses rely entirely on the infrastructure of sites such as eBay, Etsy or Amazon to sell through, allowing them to focus their energy on the operations and fulfillment ends of their business.

Amazon, eBay, and Etsy are attractive to sellers because they’re central marketplaces where customers are searching daily for the items they’re selling. When you’re starting out, eBay might be a good choice to sell new products and test customer satisfaction with quality and features but ultimately, eBay is a wholesaler that will probably be better for occasional sales rather than selling a line of products at scale. Amazon, a retailer better equipped for consistent sales of the same product, charges a $39.99 monthly subscription fee, plus referral and variable closing fees. Etsy allows creative sellers to list either single, original products like one-of-a-kind paintings or large quantities of products that you produce more en-masse for a fee. It’s a great choice for artists or crafters to create a business from their hobbies.

If you’d like to avoid marketplace fees and are willing to brave marketing products on your own, e-commerce platforms like Shopify allow sellers to design and host their sites from scratch starting at $29 per month, plus additional credit and transaction fees. Shopify also provides the ability to sell through Amazon, eBay, and Facebook if you’d like to experiment with each, in addition to selling directly.

Marketing cheaply

Whether you decide to create your own store or sell through platforms like Etsy, it’s important to get your products in front of the right audience. If marketing sounds like an expensive endeavor, it doesn’t have to be. With a limit budget, expect to put a little more time and effort into each platform to really make a difference.

Social media

As a new business owner with limited resources, it’s important to embrace platforms such as Instagram, Pinterest, and Facebook to reach the right customers. Share useful content (even if you didn’t write it), engage in the right hashtag conversations and make it as easy as possible for potential customers to discover you.

Consider offering discounts for your followers or hosting prizes and giveaways to encourage more users to follow and engage with you online. Instagram is full of influencers — offer your product to users with big followings in exchange for a review or post.

If your organic growth is a little slower than you’d like, Facebook ads are an excellent means of testing demand for a new product with a target audience and are relatively easy to create and manage even with a small budget.

A good social media campaign has a great impact on key performance indicators for every e-commerce business.


Creating a simple weekly or bi-monthly newsletter that offers subscribers pertinent content (and, better yet, your latest offers and discounts) will pay for itself in spades if executed correctly. Say you launch a clothing line geared towards tennis players. You can market this new product line to your customers with a newsletter geared towards tennis content to hype your new product. Programs such as drip and MailChimp can help you gain valuable from your audience and improve your conversion rate.


A podcast can be a low-cost way to target specific audiences interested in niche products. Using the above tennis example, purchasing a spot on a tennis commentary podcast may prove incredibly valuable — you’ll be able to speak directly to would-be customers obsessed with your niche.

Consider funding

If bootstrapping your business just isn’t cutting it, it may be time to consider business financing.  Determining what type of funding you need will largely depend on your business’s stage, the amount of capital you have on hand, your financials, and the amount of revenue you’re generating.

If you’ve produced a prototype of a new product that truly is different from available offerings, you should consider crowdfunding as a means of raising the funds you need to begin production and get your business off the ground. The numerous crowdfunding sites available specialize in different types of projects and funding models — find similar products that have been successful and take note as you start your campaign.

If you’ve successfully manufactured, shipped, and sold your product you may need funds to increase inventory or stay on top of vendor invoices. There are many options when it comes to business financing. Here, we’ll consider business credit cards, lines of credit, and term loans.

Like a personal credit card, a business credit card provides access to credit when funds might not be immediately available. Using a business card instead of a personal card will allow you to keep better track of solely business expenses and earn rewards such as cash back. For example, the Ink Business Preferred provides 3 reward points per dollar spent on shipping purchases, search engine and social media advertising, and more.

A line of credit allows you to cover unexpected expenses and hold you over as you await payments, with interest only accumulating on the funds you use. Lines of credit are available from traditional bank lenders as well as online lenders like Kabbage.

If you need more funds than are available with a line of credit, a term loan from a bank lender like Bank of America is one of the best financing options available with clear terms and competitive interest rates. Because of their competitive rates, traditional lenders are usually more selective in their review process than online lenders and may be difficult for new business owners to obtain.

The bottom line

While the many requirements of starting an e-commerce business from legal paperwork to finding the right supplier may seem daunting, especially with limited funds, it can be incredibly rewarding both financially and professionally. Successful e-commerce businesses are diverse in their models and sizes from the part-time Etsy bracelet seller to large companies like Zappos, an international shoe-selling website. Whether you stay an indie shop or you make it big, e-commerce is a great way to start your entrepreneurial career.

Meredith Wood is the Editor-in-Chief at Fundera, an online marketplace for small business loans that matches business owners with the best funding providers for their business. Specializing in financial advice for small business owners, Meredith is a current and past contributor to Yahoo!, Amex OPEN Forum, Fox Business, SCORE, AllBusiness and more.

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