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How to set up and grow your own e-commerce shop

It's estimated global e-commerce sales will hit just over $3.5 trillion this year, so if you've ever considered starting your own store, there's no better time to quench your entrepreneurial thirst.

Hundreds of thousands of people just like you make a living through e-commerce. Whether you're looking to start a new brand from scratch or sell your retail merchandise to a wider audience, it's a fantastic way to meet demand and increase sales. It also provides endless opportunities to gain that financial freedom.

In this case, all good things will not come to those who wait - it's time to do something! So we've put together this guide to help you set up and grow your own Shopify store. It has everything in it - we're talking insider tips and tricks, step-by-step instructions, and detailed information from start to finish on the basics of setting up your store and sourcing product. You'll also get intel on logistics, the best way to set up your back-office admin, and marketing your products.

If this is what you've been Google-searching for, today is your lucky day. Grab a coffee and notepad – because we're about ready to get started.


Table of contents

  1. Introduction to Shopify
  2. Finding and sourcing products
  3. The Basics
  4. Operations and logistics
  5. Back office and automation
  6. Marketing and sales

Introduction to Shopify

What is Shopify?

Shopify is subscription-based software. It's cloud-based and hosted, and has everything you need to set up, grow and manage your own e-commerce business.

Much like the many e-commerce stores that now use it to sell their own goods, Shopify had humble beginnings. We won't go into too much detail here, but how the platform came to be leads nicely into why we recommend using it exclusively.

Shopify co-founder Tobias Lütke for years couldn't find an easy way to retail his range of elite snowboards online - even with extensive professional programming experience. He was after a platform that was flexible, had different design options and was easily able to integrate with other services. So instead of wasting more time trying to make other platforms work for him, he and friend Scott Luke created their own.

Why use Shopify?

Shopify is one of the biggest online sales platforms in the world - over 33% of online stores are currently run through the platform – and in our book, it rates as one of the best.


Here's why:

  1. It's easy to use: Shopify wouldn't be as big as it is if it wasn't easy to use. No need to worry about servers, hosting and development costs. Shopify is extremely intuitive, so you can quickly and affordably set up your shop yourself.
  2. The design opportunities: Shopify's Theme Store provides access to a range of professionally designed themes, significantly reducing your website design and start-up costs.
  3. It plays well with others: Shopify integrates directly with 2,500+ apps – add as many features and functions as you need.
  4. Unlimited technical support: available 24/7, Shopify's technical support team can help keep your store running smoothly.
  5. One-stop shop: when we say Shopify has everything, we mean it – a payment provider, multiple sales channels – the works.

Key features:

  • App marketplace: it's extremely powerful, with a huge range of free and paid apps that can be integrated to improve the functionality of your shop.
  • Multiple sales channels: different ways to sell, making it easy to grow and expand your business. You can use the Shopify POS app, set up an online 'shop front', use the platform to sell product in a physical store and easily integrate with marketplaces like Amazon.
  • Payment provider: Shopify's own payment provider accepts credit cards.
  • Blog: Get help from Shopify about running your store and connecting with your customers.

What pricing plan you have will determine what features are available to you. Find out more about Shopify's pricing plans.

Types of business

Whether you're looking to jump straight in and be your own boss, or start something for a bit of pocket money, there are several types of business opportunities available to build with Shopify.


  1. Start a product-based business
  2. Launch a drop-shipping store
  3. Use the platform to promote your freelance services: photographer, graphic designer, copywriter
  4. Promote an online course
  5. Sell second-hand goods

For the purpose of this guide, we'll focus on starting a product business – this will give you the most wide-reaching advice, so even if you're not starting a product business, lots of the fundamentals are the same.

Finding and sourcing products

If there's one piece of advice we'd like to give you, it's that the success of your business will come down to two things:

  • How good your product is
  • How big your market is

When deciding on what product you're going to sell, make sure you do your research to ensure your product solves a problem for a market of people.

Deciding on a product to sell

Deciding on what product to sell will be your biggest hurdle. You may have identified a gap in the market, come up with a product idea that's going to change the way people eat pasta, or want to start a cat t-shirt business – just because.

If you are struggling to come up with a product idea, and are keen to start an e-commerce business, Shopify has some great info on where to look for product ideas.

Evaluating your idea

Once you've decided on what product/s you'd like to sell, you're best to run your idea through a few fiery hoops of evaluation to make sure you have a market to sell your product to. No use flogging a product if no-one wants to buy it. You also need to make sure your target market is big enough so you have room to scale and grow.

Research and prepare

Google's Keyword Planner Tool is a great way to gauge potential market size by determining the search volume of keywords related to your product. If the keywords related to your product have a high monthly search rate in the countries where you plan on selling, this is a good indication of interest from a potential market.

Other things to consider:
  • Can your product be purchased locally? Customers are less likely to purchase something online if they can get it from their friendly grocer down the road.
  • Who is your target market, and do they live in the areas where you plan on selling?
  • What direction is your market heading? Google Trends is a great way to explore interest over time of keywords related to your product. For example, over the past 12 months in the US, the search term 'cat t-shirts' has experienced both highs and lows of interest. If I was to start my TopHat Cat T-shirts, I'd probably need to expect my sales to follow a similar pattern, as opposed to staying steady. Google Trends is also a great way to determine whether your product idea has longevity.
Do a competitor analysis

How can you be different if you don't know what different looks like? A competitor analysis gives you that info. It will help you determine potential advantages and barriers within your target market, and by evaluating the strengths and weaknesses of your competition, you can uncover new and different ways to market your product.

Shopify's competitor analysis template

Business plan

Writing a business plan can seem like daunting stuff, so we recommend using a business plan template. If you've just started in your business, your business plan doesn't need to be 50 pages long right now. Later on, having a plan will make scaling and growing your business in the right direction so much easier.

Sourcing your product

So you've got a good product idea, you're pretty sure lots of people will want to buy it, and you've got a good idea of how to stand out in the market. The next step is to figure out how to source your product.

There are four main ways:

  • Make – for those who have the time and resources to make products themselves.
  • Manufacture – find someone else who can make your product for you, either domestically or overseas. Domestic manufacturers tend to cost more than overseas ones, so at some point you might end up trawling Alibaba. Alibaba is one of the largest business-to-business marketplaces that connects (mostly) Asian manufacturers to North American buyers.
  • Wholesale – buy someone else's product direct from a manufacturer or supplier at a discounted wholesale rate, which you then resell for a higher price.
  • Drop-shipping – buy products from another company as orders come in and let them handle shipping. For example, Oberlo lets you find products, add them to your Shopify store, and then ships them directly to your customers.

Starting a private label brand

Starting a private label brand is a great option if you're struggling to find someone who makes the product you want to sell. Private label products are outsourced to a third-party for manufacturing and sold under your brand name. You have full creative control over everything about the product – its design, materials and how it's packaged – your manufacturer will produce and deliver it to you.

Lots of people find it easier to source and sell already made products, but there are lots of advantages to creating and selling your own private label brand. You can derive better profit margins and create more equity, as well as create something that is genuinely unique.

Here are the benefits of building your own brand:

  • Uniqueness: find a manufacturer who can provide high-quality products made from the ingredients you want to work with, and you can create a genuinely unique product.
  • More control over pricing: with control over production, you can control how much it costs to make your product.
  • Adaptability: production turnaround time is often relative to size. As a smaller retailer, it's easier for you to respond quickly to market demand for an existing or new product.
  • Branding: you can design everything from deciding on a brand name to packaging.
  • Profitability: with control over all other aspects of production, you decide how profitable your product is.

The Basics: setting up shop

Setting up shop

In this section of the guide, we're going to take the cat t-shirt business idea from before as an example, and run you through step by step how to set up a Shopify store.

Naming your business

Now that you've decided on what you're going to sell, you'll need a name. Using Shopify's business name generator, you can quickly check your business name ideas and domain name availability. And, if you're struggling to decide on a name, it can help by creating name suggestions from keywords.

If we type in the word 'cat t-shirts' we get back 100 business name ideas containing the keywords 'cat t-shirts'. See a name you like? Click on it to start building your store straight away. We've chosen the name TopHat Cat T-shirts.

Shopify will automatically purchase your chosen domain name for you.

Creating a logo

Hatchful by Shopify is a simple logo design tool you can use to create a professional logo in a matter of minutes. It's free to use, you can select from hundreds of logo template designs, then customise them to suit your business and industry.

Signing up with Shopify

Once you've clicked on your chosen business name, you'll be asked to reserve your brand name with your email address.

Next you'll enter some details in a couple of dropdown menus – "Are you already selling?" and "What is your current revenue?"

And lastly, before entering your store, you'll be asked for a few personal details so Shopify can make sure you get paid once you start selling your products.

Welcome to Shopify!

Now that you're all signed up, you're ready to start customising your store. The screen you land on after signing up is your store's admin page – if you need to change anything in your store, this is the place to do it.

Shopify offers a 14-day free trial, and this will start the minute you've signed up. Make sure you click 'Select a plan' before your 14-day free trial is up.

Choosing a theme

Now the fun part! Editing the look and feel of your online store is simple through Shopify's Theme Store. Simply click 'Customize theme' then 'Visit Theme Store' to browse through Shopify's free and paid themes.

Each theme has been designed for a specific purpose. Some themes are made for stores with lots of products, others are for service-based businesses. It's important to choose a theme that looks professional, suits your brand and functions the way you need it to. You can read about each theme's features, check reviews left by other e-tailers, and view demos.

Once you've decided on your store's theme, click 'Add theme'. The great thing about the Theme Store is it's always there so if you change your mind, you can easily switch themes in 'Theme Manager' on your store's admin page.

Customise your store

You've picked a theme and it has been applied to your store. Now you can customise that theme to ensure your store doesn't look like everyone else's.

To the left of your admin page, click 'Themes'. Your current theme should now be your new theme. We recommend you duplicate your theme ('Actions>Duplicate') and work on editing your settings there. If you don't like the changes you make, you can revert to how the theme was originally.

Click 'Customize'. The left-hand column is where you can edit the different sections of a page in your store – colours and typography – as well as add in links to your business social pages if you have them.

Top left in a dropdown menu, you can change the page you're editing. The icons top centre change from desktop to mobile view, so you can edit the responsiveness of your store if needed. And you can now add in your logo that you created earlier using Hatchful for Shopify (see Creating a logo above).

Make sure you hit 'Save' when you're ready – there's nothing worse than spending hours on your masterpiece only to lose it.

Building product listings

Next step is to add product listings. Back on your store's admin page, find 'Products' to the left. You'll be prompted to 'Add product' here.

Fill out as much of the product detail as you can, including the section 'Search engine listing preview' – so when your ideal customer is searching for a product like yours, they can find you.

It's proven we often shop with our eyes, so make sure the product images you upload are clean, in focus and professional-looking. It also helps to keep everything tidy if they're all the same dimension.

Lastly, you can add your products to a 'Collection' i.e. cat t-shirts or cat sweaters. This makes it easier for your customers to find what they're looking for when browsing your products.

Again – don't forget to hit 'Save product' before moving on.

Payment provider

Under 'Settings' (bottom left on your admin page) you'll find 'Payment Providers'. This is where you manage how you get paid by your customers. You can choose to use a third-party provider, keeping in mind this will come with additional fees. Shopify also offers their own payment provider, Shopify Payments – click 'Complete Shopify Payments setup' to enter all the business account details.

Shopify Payments and PayPal Express Checkout will be automatically loaded to your account. You can choose to add alternative payment methods, too. It might make sense to add something like a laybuy payment option, for example.

Remember, each payment provider will accept different forms of payment and charge varying amounts in credit card fees, on top of Shopify's transaction fees. Take this into account when choosing which provider is best for your business.


Shipping rates

Spend time to work out what your shipping rates need to be, so you charge your customers correctly. Under 'Settings' on your admin page, click 'Shipping' to manage how you ship orders to your customers.

Use shipping zones to define regions, and shipping rates to define how much each customer should pay. If you have a weight-based shipping rate, the weight and dimensions of your shipping packaging will be used when calculating shipping rates at checkout.


Testing

We highly recommend simulating a transaction to test your store before you go live. Shopify Payments has a test mode you can use to test how your customers pay for their orders, and how you process them. While test mode is enabled, you cannot use real credit cards to pay for orders.

To enable test mode:

  1. From your Shopify admin, go to 'Settings>Payment providers'.
  2. In the Shopify Payments section, click 'Edit'.
  3. Check 'Use test mode'.
  4. Click 'Save'.

When you have enabled test mode, the Shopify Payments section shows a black and yellow striped band.

You can create orders and then simulate transactions by using a test credit card number. These are test numbers to create successful transactions, failed transactions, and transactions in different currencies.

Don't fulfill any test orders, because you are charged for any shipping labels that you purchase. If you use an app that automatically fulfills orders, deactivate it before you create test orders.

Also remember to deactivate test mode before going live, so you don't miss out on your first sales.

Launch

Yay! Just like that, your store is pretty much ready to go. Under 'Online Store>Themes', you'll need to disable password protection so the public can view your store.

Operations and logistics

Third party logistics

Using third party logistics – or 3PL for short – is a common way for Shopify store owners to outsource part or all their distribution and fulfilment.

Shopify has recently announced its own 3PL called 'Shopify Fulfilment Network', which will make it even easier for Shopify stores to ship their orders. How will it work? Your manufacturer ships your product directly to one of Shopify's dedicated fulfilment centres so when a customer buys something, Shopify takes care of packaging and delivery. This ensures timely deliveries and lower shipping costs.

Under 'Settings>Shipping' on your store's admin page, you can add a fulfilment service. There are other 3PL companies you can use with Shopify, like Fulfilment by Amazon.

There are huge pros to using a 3PL – less time-consuming, lower shipping costs – but starting with a 3PL might not be affordable for a brand-new store.

Another option is to take care of inventory and shipping yourself – perhaps with the help of an inventory app. You'll need to invest in the right equipment to ship from home, like a label printer. Do your research on packaging and shipping costs using local companies, and think about using an inventory management app like Unleashed Software, TradeGecko or Cin7.

Not using a 3PL might limit you to a local market, if international shipping rates are too expensive. This is where having a business plan in place is good – think about switching to 3PL once you can afford it.

Back office and automation

The importance of having a good back office

Automation is the key to reducing stress around business finances, and keeping good records will help you grow your business. Take advantage of Shopify's app marketplace – a powerhouse of intelligent automation – to help grow your business.

The ideal back-office set-up for an e-commerce retailer looking to take their business to the next level would include the below:

A2X for Shopify

With A2X for Shopify, you can save hours of reconciling each month. A2X imports all your Shopify transactions – sales, fees, refunds – and Shopify Payments pay-outs. It generates summarised statements tied to each pay-out, and automatically sends them to your accounting system. This ensures accurate reconciliation each month right down to the last cent. A2X then reconciles those summaries to your Shopify Payments bank deposits, so you know everything has been accounted for accurately.

Tax apps

If you plan on selling your products in the US or EU where there are multiple sales tax authorities, it's your responsibility to charge your customers, and pass on, the correct sales tax.

With a tax app like TaxJar, you'll always know how much you owe in sales tax. When linked with Xero, it works by importing your order history, pulling out the sales tax collected and automatically calculating how much sales tax you owe to each state, when and how often.

Xero/QuickBooks Online

Both Xero and QuickBooks Online are cloud-based accounting software designed specifically to support small to medium-sized business owners with their financial health.

E-commerce specialist accountants

Given the regulations surrounding e-commerce, and how easy it can be to become non-compliant, it's important to find an accountant who can offer your e-commerce business the back-office support it needs.

Specialist accountants understand the ins and outs of the e-commerce business model, and are better equipped to help you manage your financial responsibilities. They're also there to provide you with sound guidance, so you can properly plan for the future.

Here's why you should be using a specialist accountant:

  • They have a handle on your sales-tax liability
  • They know how to do your end-of-year tax returns
  • They get the sales process
  • They use technology to their advantage

Introducing A2X for Shopify

A2X for Shopify posts Shopify store sales automatically to Xero, and reconciles your payouts so that you know everything has been accounted for correctly. Never waste another minute manually reconciling your Shopify payouts and figuring out fees, refunds or adjustments. A2X automates that manual process, transforming what took hours into a few seconds.

Find Out More Sign Up Free

Marketing and sales

There are so many options when it comes to marketing and sales, so don't feel like you need to do all of them at once. Pick a couple that make sense for your business and products, and go from there.

Marketing your products

Driving traffic from social

It can be easy to spend all your time and energy attempting to drive sales through social media – without much of a pay-off. Having a social media marketing strategy can help keep your actions focused on building engagement and growing conversions through the power of online networks.

Email marketing essentials

Reach customers who have shown an interest in your product (or who have purchased from you before) with personalised, timely and relevant email campaigns.

Use an app like Privy to help you grow your email list, so you can send better targeted email campaigns to potential customers.

Facebook retargeting

Connect your social platforms like Facebook (through Facebook Business Manager) to your Shopify store and create dynamic retargeting ads. When someone looks at a product in your store, you can serve them an ad for that same product with a limited-time discount offer.

Google Shopping Ads

Connect your Shopify store directly to your Google Ads account and create a Google Shopping campaign to promote your products and increase traffic to your online store. It's a great way to showcase your products using images – after you've set up Google Ads, you can create a Google Shopping campaign from the 'Marketing' section of your Shopify admin page.

Using analytics to uncover insights

Shopify's analytics and reports let you review your store's recent activity, get insight into your visitors, and analyse your store's transactions.

Sync your Google Analytics account to your Shopify store to track how well your Google Shopping Ads are converting to sales.

Non-traditional methods

Running an e-commerce store doesn't limit you to traditional online marketing tools and strategies. Think outside the box and consider non-traditional methods like attending and promoting your product at local markets or in retail shops near your target market.

Online reviews

The holy grail in digital marketing – online reviews. They are an evergreen source of social proof, one of the most important parts of the buying process. People want to see that your product has been used and approved by others, so work to turn your customers into evangelists. Online reviews are also great for SEO.

Use apps like Delighted to set up an automatic way of gathering feedback from your customers in real-time. To gauge customer satisfaction, invite them to fill out a survey about their experience directly after they've made a purchase, or ask them to write a review one week after they've received your product.

PPC advertising

Pay-per-click (PPC) advertising – think Google Ads – is well-proven to drive traffic to online stores but make sure you consider your budget carefully. As an advertiser you pay every time someone clicks on your ad: spend too little and you're a small fish lost in a big sea; spend too much, and you're wasting a lot of money for little return.

Another tip: video PPC ads get great engagement on Facebook and Instagram. If your product lends itself well to visual media, consider video ads as part of your marketing strategy.

SEO and optimising for organic traffic

Shopify makes it super easy for you to manage your search engine optimisation (SEO) and drive organic traffic.

There are four main places you can add keywords, to improve the SEO for your online store:

  • Page titles
  • Meta descriptions
  • ALT tags
  • A page's body content

You'll find these places in the 'Customize Theme' section of your Shopify admin.

Generally, you won't need to optimise your site structure – Shopify has built-in SEO to make sure that search engines can easily find all your content.

You can do a few things yourself to make sure, when customising your theme, that your site structure is optimised for search engines:

  • Optimise your online store navigation
  • Use descriptive filenames for your images
  • Use descriptive link text for internal links

Mention-worthy apps (can be found on Shopify App Marketplace):

Fomo is a nifty app – a social proof marketing platform that helps to drive sales from social, creating FOMO by letting potential customers know what other people like them have just purchased from you.

Shopper & Stock Counter can be used to create a sense of urgency by telling customers browsing your store how many of each item you have left in stock.

The most important thing to remember with marketing is 'return on investment'. Not every marketing tool is a great strategic move for every business. Try new tactics, assign a budget you're comfortable with (both time and monetary), and test whether it's worth investing in that particular marketing strategy in the future.

Make use of Shopify's extensive blog. You'll find how-tos on absolutely everything there is to know about Shopify, including more on email marketing and social media.

Lastly, check out these Shopify stores if you're after inspiration: Allbirds and Paintvine. Remember what we said at the beginning? It all starts with the product.

We hope this guide has been super useful. E-commerce is awesome – be bold, dive deep, work hard and have fun.

Best of luck with your e-commerce endeavours!