How to successfully start a professional online store in the UK: Your complete guide in 2024!

Martin Jezy30 November 2023

If your business is not yet active in online retail in the age of e-commerce, it's high time you opened an online shop! But how do you set up an online shop and what do you need to bear in mind? We'll help you create your first online shop and get your business off to a flying start! 

The bonus for you: Download our free e-book "The Online Shop Guide 2024" as a PDF

It summarises all the important information about online shops, including: Which are the best, how to start them and everything you need to consider - technically and legally - to open an online shop!

  • The pros and cons of online stores and brick-and-mortar shops
  • Online stores and brick-and-mortar shops working together
  • The 3 ways to set up an online business!
  • Difference between an online store and an e-commerce platform
  • The benefits of starting an online store!
  • The drawbacks of online trading
  • Starting an online store and what to consider
  • Legal requirements - A checklist
  • Online store features - All the tips!
  • Online store logistics - Best practices

The advantages and disadvantages of online shops compared to local stores

The retail landscape has completely transformed: Shopping no longer solely takes place in traditional local shops but has shifted significantly towards online stores.

However, local stores still offer some weighty advantages:

  • Customers can directly view and try products in the stores before making a purchase. Trying out products remains one of the best incentives for buying!
  • They can also seek advice from salespeople and be more effectively convinced about a product.
  • Stores often have a special atmosphere and provide an experience that online stores cannot replicate in the same way.

So why should you open an online store?

  • Because with an online store, you can offer a broader range of products that can be ordered from anywhere.
  • Often at more affordable prices than in local stores, as the goods don't need to be displayed but can be shipped directly from the warehouse.
  • Online trading is open 24/7, allowing your customers to shop conveniently at any time.
[Translate to EN:] Online Shop vs stationary Shops

How can these two types of shops work together?

One way is for companies to expand their online presence by opening an online store in addition to their physical shop.

This way, they can reach customers who don't live near the local store or can't come in person for other reasons. Moreover, you can strengthen customer loyalty through various marketing strategies like social media campaigns or email advertising.
 

The brick-and-mortar store and an online store can complement each other in their offerings:

For example, an online store could have a broader selection of products compared to the local shop, which may focus on showcasing highlights or selling large, bulky items directly. By having both channels work together and refer to each other, you can significantly increase both your sales and customer satisfaction!

As a company with a physical store, having an e-commerce shop allows you to increase your brand awareness as you are present in both worlds. Additionally, it helps you minimize risks, for example, if your business needs to remain closed due to pandemics. Merchants who operate both local stores and online shops have greater flexibility and can respond better to market changes.

  • Essentially, each sales channel has its own advantages and disadvantages, but when you cleverly combine them, they create an unbeatable combination. The most crucial aspect is understanding customer needs and implementing the right strategies to reach them. By doing so, you can achieve success in both the online and offline realms!
[Translate to EN:] Online Shop Smartphone

The 3 ways to build an online business:

You have several options for setting up your online store:

  1. You can use an online shop system that allows you to create your online store relatively easily on your own. Examples of such systems include Shopify, WooCommerce, or PrestaShop.
     
  2. Alternatively, you can have a web agency handle the complete development of your online store. They can build it for you using platforms like WordPress with WooCommerce, Adobe Commerce, or OpenCart.
     
  3. Another option is to utilize existing e-commerce platforms like Amazon, eBay, or similar ones to sell your products. This approach offers the advantage of tapping into the existing customer base and reach of these platforms.

The difference between an online store and an e-commerce platform:

Both are essentially different-sized websites, each with distinct functions:

An online store is owned by a single company that sells its products.

  • Advantage:
    You have no competition on the site - everything revolves around your brand. The development and operation of your online store are entirely in your hands. You can design it the way you like to perfectly showcase your brand. No one dictates fees to you or takes a cut from your sales. 
     
  • Disadvantage:
    Your customers must first find you, so you need to invest in marketing to make your own online store visible beyond word-of-mouth. 

E-commerce platforms like Amazon or Alibaba, on the other hand, offer a multitude of companies the opportunity to sell their products through them.

  • Advantage:
    The benefit here is that you are provided with a ready-made and efficiently optimized marketplace where you can operate.

    Your customers can find your products through the platform's general search function and can create a mixed shopping cart with various products from different companies, similar to shopping in a supermarket. This synergy effect is very convenient for customers and a strong selling point for marketplaces like Amazon or Alibaba.

  • Disadvantage:
    However, this comes with fees to the respective platform. You also need to ensure that you present your products in the best possible way. The framework for that is defined by the e-commerce platforms and is often visually limited. Additionally, the competition can be quite high depending on the product category, with all that entails.

Bonus Tip: In e-commerce, it is now considered best practice to have both your own online store and sell through Amazon. Many companies generate significantly more revenue there due to the vast reach of the online giant compared to their own online stores.

These are the advantages of starting an online store - for you and your customers

Whether you already operate a brick-and-mortar store or not, these points apply equally to every company:

  •  Greater Reach

A physical store typically has limited reach as it can only be visited by customers who live nearby or are in the vicinity. By having an online store, you can reach customers from all over the world and significantly expand your target audience. Sell your products internationally!

  •  24/7 Open

While a physical store is bound by specific opening hours, customers can place orders in your online store at any time. This way, you won't miss out on sales outside of regular business hours!

  •  Better Advertising

With online marketing, you can significantly increase the reach of your shop and strategically expand your presence on the internet. By using SEO, SEA, or social media marketing, you can precisely target the audience you want to effectively promote your products.

[Translate to EN:] Online Shop
  •  No physical presentation needed

Online stores don't require physical storefronts, shelves, or on-site sales staff to display products. Instead, products can be directly distributed from the warehouse. This saves space, and the ongoing costs are generally much lower. Also, the personnel expenses are usually lower as you won't need as many employees as in a physical store. Overall, this often allows you to offer lower product prices, which will delight your customers.

  •  Improved customer retention

An online store offers numerous opportunities to personalize your offers for customers, creating a better shopping experience. By using theme-specific promotions or organizing your online shop based on target groups you address in a unique way, you foster customer loyalty that pays off.

  •  Greater flexibility and return policy

Another significant advantage of online shopping for customers is the return policy. Unlike in physical stores, customers have the right to withdraw their purchase within 14 days and request a refund. This means they cannot be compensated with vouchers they likely don't want.

  • Return or exchange options are not legally mandated for physical stores but are based on voluntary offers by the companies!

Are there any disadvantages in online retailing, compared to stationary shops?

  •  The personal contact is missing

In online commerce, the personal contact between you and your customers or employees is absent, which can lead to customers feeling uncertain and deciding not to make a purchase.

  •  No testing possibility

Customers cannot directly test or try on your products on the internet. Therefore, many hesitate before making a purchase and may end up changing their minds.

  •  Lower trust

Since customers cannot physically touch and test the products, there will inevitably be more erroneous purchases and a higher return rate, along with logistical effort and material waste.

A reputable reputation is of great advantage here, as can be seen with e-commerce giants like Amazon, Zalando, or AboutYou. Being present with your products on Amazon, for example, increases customer trust. Selling through various well-known channels adds to your credibility and can lead to greater sales.

  •  More returns

Since customers cannot physically touch and test the products, there will inevitably be more erroneous purchases and a higher return rate, along with logistical effort and material waste.

  •  Competition

The online market is highly competitive, and companies must compete against numerous competitors. Without a precise plan, entering the world of e-commerce can be challenging.

[Translate to EN:] Brick and mortar shop

How to start an online store and what to consider:

  • You have your business plan ready, your business idea formulated, and you have considered your target audience and the market? These are distinct and essential topics that you should thoroughly examine before starting an online store!
     

If so, here are the essential tips to bring your online store idea to life!
 

To start with, you must first define the legal framework. Depending on the country where you operate, there are various legal requirements that you need to consider as an entrepreneur.

These may include:

  • Choosing the legal structure,
  • Registering your business,
  • and possibly trademark registration.

There are also different points that your website or online store must include, according to the applicable local law, such as:

  • Privacy policy,
  • Cookie banner,
  • Terms and conditions (T&C),
  • Imprint, 
  • Cancellation and return policy,
  • Liability information, and Trademark rights

There are various points that your website or online shop must contain in any case according to local law! You can find out exactly what these are in our comprehensive eBook, the Online Shop Guide!

 

Registering a business for your online store:

You can register your business at the companies house in the UK.

It depends in which country youre starting.. If youre a german seller for example, you can register your company at the local trade office (Gewerbeamt) in Germany. 
 

Analyze your target audience

Before creating an online store, carefully examine your target audience: 

  • What products can improve the lives of your customers?
  • What sets your online store apart from others?
  • Who are your potential customers, and what are their needs?
  • Which products should you offer online, considering logistics?
  • How can you best showcase your products?

A comprehensive analysis of your target audience will help you build your online store successfully and according to a plan. Study what your competitors are doing and take inspiration from them. Create a structure and think about how you can excel!

[Translate to EN:] How to start an online store

The checklist - things to consider with online store systems:

There are many different online store systems available in the market, varying in functionality and cost. Based on your business plan, you know best how it should look and what features are needed. Get an overview and select the online store system that best fits your company and your preferences. 

The checklist - things to consider with online store systems:

  • Webshop creation and simultaneous (domain) hosting with the online store system provider.
  • Included templates for website layout and legal texts.
  • Customizable design and marketing tools.
  • Included standard data protection agreement / cookie banner.
  • Integration possibility of external software, such as Google Analytics or ERP systems.
  • Pre-integrated payment service options.

 

Here are some of the most widely used online store systems globally, relied upon by millions of merchants:

An overview of the online shop systems:

User-friendly optimization:

The design of your webshop is your calling card. Create a professional and user-friendly design so that your customers can quickly navigate and be fully convinced of your offerings.

Ensure that your online store is optimized for mobile devices, as a large portion of online customers place orders via smartphones!

 

Invest in Online Marketing:

To ensure that customers find your online store, online marketing is essential. Utilize all available marketing channels, such as Google or social media, to increase your reach and target customers effectively. Invest in high-quality content and optimize your website for search engines to improve your Google search rankings.

  • Bonus Tip: Word-of-mouth marketing is still the most effective advertising tool! If you sell high-quality products, word will spread, reducing your reliance on online marketing. You can combine both approaches by collaborating with micro-influencers on social media platforms, who can promote your products to their followers.

     

Offer fast and reliable shipping:

Customers do not want to wait long for their packages! Logistics is a critical factor in online commerce that significantly impacts customer retention and satisfaction.

The best example? Amazon! They have successfully built a positive image through fast delivery and straightforward refunds. Therefore, optimize your logistics processes to ensure they don't become bottlenecks that impede your business. Provide swift and reliable shipping to keep customers happy and coming back for more!

  • Tip from our logistics experts: If you need assistance with your logistics, you can also outsource it to professional fulfillment providers. Find out when it makes sense for you to do so in this article!

 

Get our new, free e-book and checklist: "The Online Shop Guide 2024":

And find out everything about the topics:

  • How much does an online shop cost and how much start-up capital do you need? 
  • Which online shop provider is the best and what are the differences? 
  • Which free online shops are there? 
  • Which business do I need to register for an online shop? 
  • What legal issues do I need to consider when setting up an online shop?

... And much more! Download your detailed online shop guide now for free.

Sources

*Sources: Statista, Tooltester, Smartstore - 2021/22
**Blog article: As at the end of August 2023 - Prices and offers from online shops are subject to change.

Page: Right of return - customers have these rights
URL: https://www.ihk-muenchen.de

Page: Right of cancellation in stationary retail?
URL: https://www.versandhandelsrecht.de

Page: Exchange: What you should consider when buying!
URL: https://ooe.arbeiterkammer.at/beratung/

Page: Which legal form is the right one for my online shop?
URL: https://www.haendlerbund.de/de/ratgeber/

Page: Setting up an online shop
URL: https://www.usp.gv.at/gruendung/

Page: Shop systems in eCommerce
URL: https://www.seo-kueche.de/

Page: Opening an online shop: Legal requirements
URL: https://www.fuer-gruender.de/

Page: Advantages and disadvantages of e-commerce companies
URL: https://www.haendlerbund.de/

Page: Prevent purchase cancellations
URL: https://www.tecchannel.de

Image sources:

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