E-commerce website costs: A detailed pricing guide

Whether it’s a simple website containing just a handful of products or a powerful e-commerce platform, the cost of creating an e-commerce website depends on many factors. Find out how online shop costs broken down in detail and what should you expect.

What are the setup costs for an online store?

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

Design

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 customize specific features? If you want a custom design, you’ll need to pay an agency or freelancer to create your site. You also need to make sure the shop software you pick is compatible with the design.

Features and functionality

Even the simplest, most affordable e-commerce solutions come with basic features like a navigation system, filters and a shopping cart. However, if you have special requirements, you’ll either have to opt for a high-performance (often more expensive) solution or have these features individually programmed. The most complex and expensive sites are those that include a product configurator that lets customers customize their order.

Content

Do you plan on 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 will the provider take care of this?

People often underestimate the cost of creating content for an online store. You’ll need at least one good photo of each product, probably more though. 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 specialized agency to create content for their site. The latter often has the advantage of several people working together on images and text, making the processes faster and less prone to errors. Agencies can offer quicker turnaround times and high quality as they usually have a whole team of content experts on hand.

It’s even more cost-effective if you sell products that you don’t manufacture yourself, and the manufacturer provides the corresponding product content.

Although the number of products and type of content have no direct impact on which store system you choose, they are linked to the next two factors. As such, they do influence system choice, and, in turn, your e-commerce website costs.

Product data management

Many store 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.

Support for multiple languages

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

Payment and shipping options

Some solutions also offer built-in tools for integrating online store payment methods and shipping options, including invoicing and shipping directly in the backend. Alternatively, you can opt to integrate external point-of-sale systems and shipping software.

Domain and hosting

You also need to consider the costs for the domain and hosting of your store. Domains are usually allocated via domain registrars, such as IONOS. You pay a monthly fee for the use of the domain name, no matter how big your online store is. Most domain names only cost a few dollars per month, however, popular domain names can cost much more.

There are two options for hosting your store. You can either host the website yourself or get a hosting provider to do it for you. If you host your store yourself, you are responsible for everything related to server operation. This includes purchasing the necessary hardware, operating costs, configuring and maintaining the hardware and software, cybersecurity and ensuring the availability of the website. If you opt for a hosting provider such as IONOS, these tasks are largely taken over by the provider meaning you only have to worry about the business side of things.

What software costs are there when setting up an online shop?

If you want to open an online store, there are three basic options to choose from: an online store builder or ready-made online store which you pay a monthly fee for, 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.

Comparison of online shop solutions and costs

You can also find extensive information on the individual solutions in our detailed comparison of different online store software, including the main advantages and disadvantages of each.

Website builders and hosted platforms at a glance

Online store builders and hosting 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. There’s also usually a support team on hand to help with any questions. As well as the actual store, the plan often includes a domain and/or a standard website, and hosting. The cost of this type of solution starts at around $30 per month, plus any content creation and setup costs for the e-commerce website.

Open-source solutions at a glance

Open-source solutions are widespread and powerful solutions for small and medium-sized store owners with more specific ideas about design and function. One of the most popular options is to run an online store on a WordPress site using a plugin like WooCommerce, which is one of the most popular options available. Open source typically means it’s an almost free or very cost-effective shop solution. However, many plugins and features come with expenses, either for purchase or custom development. Nevertheless, this option comes with an exceptionally high level of design flexibility.

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

Proprietary store solutions at a glance

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. At the lower end of the price scale you have Shopware and at the higher end SAP Hybris Commerce.

Different providers offer different payment models. For some, you pay a one-time fee to purchase the software, and for others, you pay a monthly licensing fee. Entry-level plans start at a few thousand dollars, but for the most powerful solutions, you can easily pay upwards of $20,000 – and keep in mind, this doesn’t include setup or content creation costs!

What other costs are involved in creating an online store?

Besides the costs for the online store software, initial setup and content creation (if necessary), there are several other areas where costs can arise when opening an online shop.

Design

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

External systems

Even if you’re just starting out in the e-commerce world, you might want to invest in advanced features from the get-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 dollars to more than $30,000. The more expensive options include features like invoice generation, reminders and tools to manage product and customer data.

Storage and shipping

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 fulfillment company or dropshipping provider.

Legal advice

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 Terms & Conditions and privacy policy.

Marketing

If you’re running an online store, you also need to consider search engine optimization, ads and other online marketing strategies. Depending on your target audience, needs and budget, you might be able to handle the marketing yourself, or you might want to outsource this to a freelancer or agency.

Maintenance and running costs

Whether you’re running your store 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.

Staffing costs (in-house, freelancers and agencies)

Another decision you’ll need to make that affects costs is whether you’re going to run your store by yourself or with the help of a freelancer or an agency. There are ways to cut online shop costs here:

• If you’re tech-savvy, you can take care of 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 you would just act as a coordinator.
• 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 store, but don’t forget that recruiting and managing staff will take time and money.