In this post I show you how to start an e-commerce business that costs only ±R1000 per month. I cover the best value-for-money tools I use for marketing, my online stores, order fulfilment, accounting and a few extra tools.
These tools have been tried and proven with both online stores I run:
At the end of this article, you will have everything you need to start your own e-commerce business.
Does it really only cost R1000 per month?
Most people have thought about selling a product at one time in their life. It used to be very capital intensive:
- You needed money to buy inventory
- Rent some space
- Buy a cash register
- Decorate your shop
- Hire some people to help you on the shop floor
Only after you have all of the above items ticked off, could you start thinking about marketing your products and getting some actual clients through the door.
E-commerce has lowered the barrier to entry
In 2022, all you need to start an online business to sell your product is your laptop/phone and a small amount of money to get you going.
I will give you a short snapshot of all the tools, tips and tricks I use to run 2 e-commerce brands. The two brands are:
- The Daily Wine - an online store that sells South African wines to customers in curated variety boxes and at great prices.
- Kiki & Co - an online store that sells colourful scrubs to medical professionals worldwide, helping them make an impression whilst making an impact
Here are the tools I use:
I am going to list each area of an e-commerce business and the specific tool I use to cover that area.
Marketing Material - CANVA
I have put this point first because it's probably the most important. If you have an online store, you do not have a physical location people can come to, they visit your online store or they visit your social media channels.
In all of the above, you need to communicate with words, but you NEED to communicate VISUALLY. CANVA is a very powerful piece of software, which enables you to create beautiful designs without needing to be a trained designer.
Using CANVA you can create social media posts, newsletter images and images for your website. CANVA also offer free training courses if you would like to sharpen your design skills.
COST = R110.00 per month
Online Store - SHOPIFY
Next up, you need a platform to host your online store.
You might have heard a few words like domain, hosting, SSL, and DNS.
Don't STRESS - by opting to use SHOPIFY, all of the above will be handled for you. You can literally have an idea in the shower this morning and have an online store running by lunch.
It might be a bit more expensive than other options (WooCommerce), but it works, it's secure and did I mention it works?
COST = R305 per month (+ 2% transaction fees)
Payment Gateway - Payfast
Now that you have your online store up and running you can almost start taking orders, all you need is a payment gateway.
What is a payment gateway? A payment gateway is a secure link between your online store, the customer and your bank account.
There are many payment gateways available in South Africa. The gateways are very similar with the main differences being their fees. For the purpose of this article, we are going to go with Payfast, seeing that they are 100% compatible with Shopify.
COST = ± 3.5% transaction fees
Social Media Marketing
Now your website is up and running, you have a payment gateway set up, and now you need to get traffic to your store. The easiest way to achieve this is with social media. The platform you choose is highly dependent on what product you will be selling and who your customer will be.
For example, if you sell designer clothes, a visual platform like Instagram or Pinterest may be best. If you are selling corporate gifts, you might opt for Linkedin.
I would advise against trying to be on all social media channels, figure out where your customers "hang out" and target that channel.
COST = FREE
Email Marketing - SEGUNO
Email marketing is still the most effective marketing channel. Believe it or not. It's cheap, it's fast and it's effective.
I am going to recommend that you use SEGUNO. The service integrates flawlessly with Shopify, the pricing is very fair and it enables you to send out Fortune 500-type marketing emails in a few hours.
COST = R160 per 1000 subscribers
Order Fulfilment - uAfrica
The dopamine rush you get from getting that first order is like nothing else - and you deserve it!
But now you wander into the next phase of your online business. Your client has placed their order and now they want it delivered. ASAP.
Which courier should you use? How does it work? I have great news, the team at uAfrica has made it possible for any entrepreneur in South Africa to fulfil their orders with minimal effort.
Once you receive an order on your website:
- It syncs over to uAfrica
- uAfrica gets quotes from all the major couriers in South Africa
- Their user-friendly website kicks out the best option
- And with the click of a button, the courier is booked, the client is notified and you can sit back and relax.
COST = R99 per month + rate per order
Accounting - Xero
Now we get to the step no one likes, but everyone underestimates the importance. Doing the books.
If you are like me, you don't like it because it's tedious. Which is fair.
That being said, the benefits of doing your books is:
- It's easier to keep track of who owes you money and who you owe
- Make better decisions based on history
- Stay up to date with your taxes
COST = R350 per month
And that's all you need to start and sustain an online business in South Africa in 2022
The total cost comes down to ±R1024.00, please note some of these costs may vary, due to exchange rate fluctuations.
Spending a R1000 per month may seem like a lot of money, but you can quickly determine how much you need to sell in order to cover the overheads.
Let's say you sell a product for R500 and it costs you R300. That is a healthy profit of R200 per item sold.
That means, all you need to achieve is sell 5 items per month and you have covered your overhead costs and any sale made after that is profit.
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