Resources for Small Business

Things You Need to Know Before You Start Selling Online

 

Planning to take your brand online? Do not know how you are supposed to do it? Confused as to what hosting, domain name, payment gateway, etc mean? Do these terms scare or confuse you? Tired of long hours on Wikipedia and Google trying to make sense of what all this means?

Here is this blog that will give you a clear insight regarding what you need to know before taking your business online. This post will simplify

  • What E-Commerce is about
  • The basic requirements for a business to go online
  • All the technological jargon for you

So take a deep breath and just read. As you read through, you’ll see yourself miraculously changing to an E-Commerce Pro in just 5 minutes.

Requirements For Selling Online

So basically when you just want to start selling online, the four major challenges that you come across are –

  1. Technology (Your website, dashboard, every back end operation)
  2. Marketing Support (How to bring in more customers)
  3. Payment Processes (Your Payment modes via Payment Gateway)
  4.  Logistics (How you ship the products, how to receive COD)

So if you see what happens, then it could be summarized as –

Process for Selling Online

Process for Selling Online

Let’s try explaining to you all the technical terms that are used in E-Commerce using day to day examples for better clarity of thought and understanding purpose.

1. What is SaaS (Software as a Service)?

The first question that pops up in our mind is that what is SaaS? SaaS is an acronym for Software as a Service which means that users rent or subscribe to a certain software hosted on the internet. Instead of installing and maintaining the software, you simply gain access to  it via the Internet, freeing yourself from complex software and hardware management.

So for example you have a shop in a mall. So all services of the mall like electricity, security , water supplies are accessible to you and you can use them whenever you want. You pay them monthly for these services. Also your shop has its own security lock. Similarly you have a SaaS software where you use all the services, you pay them monthly or subscription wise and then you have your own ID and login credentials.

SaaS- Platform For Selling Online

SaaS- Platform For Selling Online
Courtesy: mytechnology.com

I hope this makes a little easy to understand, moving on towards choosing an E- Commerce platform which is a SaaS platform.

Choosing an E-Commerce platform to start selling online is more or less like “Renting a house”.

You look for different houses and then you settle for one. You check for the rent, the services it has and if it suits your requirements. Then you decide and you make a payment that is your rent. Right?

So here the platform or the new house that you have chosen for yourself is the E- Commerce platform, that is going to rent its space to you with monthly rental charges.

2. What is Hosting Space and Domain Name?

The hosting space that we give to you is the house you want to rent. Now for anyone to recognize that the specific place belongs to you, you use a nameplate. That name plate for your website  is the “Domain” in this case. So for example you would have seen the nameplate as “Sharmas” similarly your domain name can be “Sharmasonlinestore.com.”

What if you already have a domain name?

Well using the same example as above, what if you have an old name plate that you love? You’ll bring it to your new home and place it on that. Right? Similarly you can bring your old domain name and link it to your new online store through domain linking. So your domain tags along wherever you go.

Your Domain Name Is Just Like Your Nameplate

Your Domain Name Is Just Like Your Nameplate

3. What are Payment Gateways?

Now the next thing that comes into the picture is the “Payment Gateway”. Now your payment gateway is just like your “Wallet”. Yes necessarily not that heavy though but definitely worth the value. This is the place where money transactions take place. You bring it with you or you buy one and use it.

It is the mode by which your clients make payments on your website. Whenever you move, wherever you move , it goes with you because you brought it in your name. This is how the Payment Gateway works. It is registered in your name and it goes with you. Just like I said where ever you go, it will follow.

Want to know how good or bad the payment gateways are? Check this Review of Major Payment Gateways 

What do we mean by “Free Payment Gateway”

When you want to own a payment gateway you need to pay a certain fee called the “Setup Fee” which is for integrating your payment gateway with your website and “AMC” i.e. The Annual Maintenance Charges”. When you take a plan with any E-Commerce Platform then your setup fee and AMC are waived off.

Payment Gateway for selling online

Payment Gateway for selling online

 

What Are The Various Taxations Needed To Start

For you to start selling online, you need to register for some taxations that happen when you sell online.

1. If you are getting products listed on your website and you are taking commissions on the sale then Service     Tax will be levied.

2. If you are selling products online on your website then Sales Tax is applicable. Depending on whether you sell intrastate (then VAT is applicable) or if you sell interstate (CST is applicable) your sales tax is applied.

For more information on VAT Registration and Process you can refer to VAT Registration Simplified.

3. And above all you become eligible for Income Tax. One has to pay 30% of their total profit as Income Tax every year if they are an Indian Entrepreneur and 40% if they are a foreign company doing business in India.

That is all for now. I will keep searching more examples for making this journey easier for you to sail through. Do let us know if you have any more queries or if you want us to simplify any particular topic for you.

Hoping you got the concept right now comes the next big step.

There might be many terms that confuse you or you cannot relate to or understand. Let us know which ones do you want us to decode.


 

Want to start selling online and become the next biggie in the field of entrepreneurship?
The Time Is NOW, Start Selling Online!! Try out the Zepo E-Commerce platform!!

Yes, I’d Like to Start Selling Online

 

 

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Divya Sharma Dixit

Divya Sharma Dixit

Divya Sharma Dixit: Electronics and Communication Graduate bitten by the StartUp Bug.
From being an Engineer to a Journalist to Business Development officer and now Marketing, she always is on her toes. She takes life as it comes.
Writing is her mode of relaxation.
Pretty active on Social Media, be it Facebook or Quora.

Ping her if you have any query, suggestion or even if you just want to say hi!!

  • Hi there,

    Thank you for writing in to us. Answering your queries below:

    1. Since the designers are not going to be listed on your website as sellers themselves, you won’t need a Service Tax registration for the same. Because you are the single entity handling business transactions.

    2. You can postpone VAT registration by a few months. But we’d have to alert you the state authorities have gotten stricter about inter-state shipping and there are chances of shipments getting seized without the proper shipping forms. Hence, it’s a risky business sending products without any kind of business registration.
    I don’t see a problem why it can’t be issued on your house address. But I’d still say consult a CA for the same.

    For any other help, you can reach us out at 922 358 3358 or mail to us at hello@zepo.in.

    • ff501998

      Thanks a lot for the answers, really helped.

      • Anytime! 🙂