How to create an online store

How to create an online store

€39 per month (excluding VAT).
How to create an online store

Everything you need to know to start selling online

Since e-commerce continues to grow as a general purchasing method for any type of product, from food to electronics, to toys or books, more and more small companies or retailers are expressing their interest in expanding their physical business and taking it online too.

The problem with this expansion lies in how to do it and how to succeed. What can you sell? How do you set up an online store?

This article will cover how to do this and much more. The answers to these questions will make the task of opening an online store that little bit easier. It will also provide information on how important Internet sales are, creating an online store, creating ads for products, organising storage, shipping and delivery, offering various payment options and how to make a store attractive and more visible to customers, or in other words, advertising.
It will also include a comparison of creating stores for selling partners on consolidated websites versus creating a new one, detailing the potential advantages and disadvantages of both options.

Along with all of the above, information will also be provided on the process of creating an Amazon store and the advantages, tools and services offered to help selling partners create and enhance the success of their store.

We will then discuss the delivery or fulfilment process. Fulfilment by Amazon will be discussed in detail as one of the options available in the particular case of selling through Amazon.

Finally, we'll discuss the ways in which selling partners can advertise their website and the tools offered by Amazon to do this.

How online selling works

E-commerce has experienced significant popularity in recent decades after the emergence and proliferation of the Internet, but this is not the only element that sets the stage for its expansion. The following aspects have helped to make online sales so successful:
  • Widespread access to mobile devices: The vast majority of the Spanish population has a smartphone and Internet access, which has made it easy to shop online in a matter of minutes.
  • Convenient shopping: Not having to leave home, especially during the pandemic, in addition to being able to shop in stores almost anywhere in the world, has opened up a whole world of opportunities. For customers who live in more remote areas or far from urban centres where physical shops are therefore scarce, online shopping has allowed them to access a very wide catalogue of products at competitive prices.
  • Price: In relation to the above, since you can shop in numerous stores on the online market, the offering is much wider and prices therefore become more competitive, something that has benefited buyers.
  • Shipping and return options: Today almost any product can be shipped anywhere in perfect condition. What's more, if the product does not meet the customer's needs, they can simply return the product and, in many cases, this is also free of charge.
Given all of the above, it's no surprise that e-commerce is becoming increasingly attractive to customers, who can find fantastic offers in both national and international stores, just a click away and without having to leave their homes.

However, the proper management of all these aspects requires some preparation and knowledge, so if you're considering creating your own online store, read on to learn about how an online sales establishment operates.
How online selling works

Comparison: online stores versus conventional physical stores

In the last decade, e-commerce has been heralded as the natural evolution of traditional physical commerce. Everything would indicate that this is true. Primarily, this is due to:
  • Greater business opportunities: By opening up to the world of the Internet, a store ceases to depend on the clientele that passes in front of its physical shop or the street where its shop is located. The Internet is now their high street, and their audience is so wide that, with the right promotional tools and an optimal marketing strategy, anyone can become a new customer.
  • Extended hours: With online sales, opening hours are a thing of the past, as access to your store is extended to 24 hours a day, 365 days a year. There are no holidays for shoppers, who can visit the online store from anywhere in the world, regardless of their time zone.
  • New selling options: Dropshipping allows an e-commerce store to start selling new products without the risk of having to invest large amounts of money in expanding its catalogue and inventory, as would typically be required in a physical shop.
  • Lower opening costs: Opening a conventional shop is undoubtedly much more expensive than an online store. This is because online stores have no need for commercial premises or additional staff to cover different opening hours or shifts. And with dropshipping, you don't even need a physical warehouse. Initially, one person may be enough to manage an online store.
It's also increasingly common to see traditional physical shops also deciding to set themselves up online, even if they still keep their physical shops. This has multiple advantages for these shops, such as:
  • Increased revenue: By expanding into the world of e-commerce, they benefit from two sources of revenue: physical commerce and online commerce.
  • Increased visibility: Your online presence can benefit not only your e-commerce store, but also your physical business.
  • Better customer experience: Collecting data on customers, visits and sales through the Internet can be a great advantage if used appropriately, so as to improve the customer experience after analysing their wishes, needs or buying habits.

How to set up an online store

Creating an online store is a simple process that doesn't require large investments or huge numbers of staff. Some of the initial steps are the same as those that would be taken to open a traditional business, such as:
  1. First, it would be a good idea to carry out a survey of the market and your competition. To do this, you should research, observe and learn from companies operating in the same sector as you, if applicable.
  2. Next, you should create a business plan, in which you specify the products you want to offer.
  3. Once you have figured out the above, it's time to create your website: choose a meaningful domain, so one that references the name of your company or the product that you want to sell so that your website is easily recognisable and easy to find. You'll also need to choose a hosting service provider. An attractive and distinctive web design will also make customers associate the website with your brand.
  4. The next step is to make your online business legally official. To do this, register your trademark and register yourself in the mercantile registers as required by law.
  5. You're now ready to develop a marketing strategy that will advertise your brand and your products, to increase your online business sales and stand out from the competition.

Register an online business

As you can see, one of the most important steps when it comes to working in the e-commerce sector is to register your company to avoid any legal issues that could cause you an unnecessary headache.

To sell products through an online business, just like in a physical shop, you must register as self-employed or set up a company. If you choose the first option, you must first register with the Treasury using Form 036, and you must also register as a self-employed person with Social Security.

However, in most cases, setting up a Limited Company (Ltd) is recommended, as this means that civil liability is limited and the private assets of the business owner(s) will not be affected in the event that the company does not perform as expected.

Setting up a company is not particularly complicated, but usually it's advised to entrust this legal and bureaucratic aspect to a company.

To avoid fines or financial penalties, you must have all the relevant paperwork in order and have taken out all the necessary insurance policies, in addition to making sure that your company complies with current regulations.

In this respect, it is important to remember that there are increasing restrictions and requirements to be met with regard to data protection and privacy laws to protect consumers in the e-commerce sector. You must also inform the buyer or visitor to your website of all the selling conditions, delivery times, payment terms, legal guarantee, etc. so that all the relevant information is always published and available to anyone who wishes to consult it.

Create a selling strategy

As mentioned above, once the company is set up, you need to decide what you're going to sell and how you're going to do it. Consider a selling strategy and plan.

To do this, you must choose which products you're going to sell in your online store, taking into account that there are certain types of products for which sale is restricted or special requirements are in place. Once you have determined the product category, you must create a catalogue or list of products to classify and advertise them on your website.

Customising the products in your online store is an important part of your sales strategy. Some actions you can take to customise products include:
  • Taking good pictures of your products: The more high-resolution, complete images from different angles you include, the more accurate the potential buyer's idea will be of the product that they want to purchase.
  • Record videos: Sometimes watching the product live, in motion or action, can be highly beneficial.
  • Include your corporate image: Both in products and in images. This will make a better impression on the customer and will strengthen your image as a brand, so customers will remember and recognise it in the future just by seeing your logo or emblem, for example.

Sell on your own website or sell on Amazon

As we have already seen, you can create an online business from scratch without having to invest large sums of money and by following a few simple steps. Before deciding to create your own website and manage your online store completely independently, you should consider whether it's worth it or whether to set up your store through Amazon.

Setting up your online business on Amazon will save you a lot of problems when it comes to management, fulfilment or marketing strategy, since it offers you countless tools to make all these tasks easier for you. However, you should assess the pros and cons of setting up on your own without intermediaries or counting on Amazon and its popularity among e-commerce customers.
How to set up an online store

How to set up your Amazon store

If you ultimately choose to set up your online store on Amazon, there are a few things you should know:
  • The first thing you should do is register as an Amazon selling partner. You can do this using the following link and by taking a few simple steps.
  • You'll then need to choose a selling plan. There are two options available to selling partners. The first is the Individual plan, where you must pay €0.99 (excl. VAT) every time you sell a product. Alternatively, if you sign up to the Professional plan, you'll pay a monthly fee of €39 (excl. VAT) plus additional selling fees, regardless of the number of products that you sell at the end of the month. For both plans, Amazon also charges a referral fee for each sale, which is a percentage of the total transaction and varies by product category.
  • Once you have chosen your plan, you must select the categories of products that you want to sell. Not all products are free from restrictions. For example, to sell products protected by copyright, trademark or patent, you must be the legal owner of those rights or be a distributor authorised by the owner. There are many categories of products and their condition (new, refurbished, used, etc.), so you'll have to divide your online store into set categories.
  • Last but not least, provide your potential customers with clear and concise information about the payment and returns policy, and make sure that you provide suitable customer service.
However, the above is just a brief summary of all the information you can find on Amazon, where there is a very extensive guide that includes all the aspects we have discussed about creating your own online store, your product catalogue, establishing your payment and shipping options or returns policy, among other aspects.

What's more, if you build your own brand as a selling partner within Amazon, your reach will be that much greater. To this end, Amazon makes various programmes available to selling partners so that they can choose whichever programme best suits their type of online store and the products they sell. The most notable programmes include:
  1. Amazon Custom: For selling customised products.
  2. Amazon Handmade: A programme designed for selling handmade products. This community already hosts artisans from more than 80 countries.
  3. Amazon Renewed: With this programme, you'll be able to offer certified, used, open-box refurbished products with warranty.

Using special Amazon services for selling partners

Amazon has created a set of tools to help customers find your own brand on the website. This is called the Amazon Brand Registry, and by registering your brand here, you'll be able to access a set of tools that will help you design and protect your brand.

There's also the IP Accelerator tool within Amazon Brand Registry, which gives you access to a wide network of law firms specialising in intellectual property, which will advise you so you can legally register your trademark as quickly as possible.

Services such as Brand Analytics are also offered, which allow you to access large collections of aggregated data reports on search terms most used by Amazon visitors, shopping behaviours, analysis of potential customer shopping baskets, demographics, etc.

With the right selling programme, advertising your listings and making optimal use of some of the tools and services made available to you by Amazon, you'll be able to find your niche, increase your sales and reach many more customers.
Using special Amazon services for selling partners

Fees and payments for selling on Amazon

Selling plans
As mentioned earlier, Amazon offers two selling plans:
  • Individual: You pay €0.99 (excl. VAT) per product sold (plus additional selling fees).
  • Professional: You pay €39 (excl. VAT) per month regardless of the number of products that you sell (plus additional selling fees). This plan also includes many more features than the Individual plan, as it allows you to request sales in additional categories, save time by creating bulk listings, manage inventories through files, spreadsheets and reports, increase sales efficiency with API integration, etc.
Category referral fees
This consists of a fee that selling partners must pay for each product that they sell. This fee will vary depending on the category in which the product is classified. Minimum referral fees apply if the price of the product is too low, or referral fees can also be based on a percentage. Make sure that you take a look at the pricing table to see which fees apply to your products.
Fulfilment fees
Selling partners must also pay a fee corresponding to the shipping plan for their products. Shipping can be fulfilled by the selling partner themselves or fulfilled by Amazon through Fulfilment by Amazon. You can find more information about the service offered by Amazon and its fees here.

Delivering products to customers

The next step to consider when setting up your online store is how to manage the fulfilment and delivery of your products once they have been purchased by customers.

A guaranteed delayed or late delivery can result in a poor customer review of your service, which will greatly impair the value of your overall product, as well as your online store.

It's also important to offer a prompt after-sales service that meets customer needs, as well as having a suitable returns policy to offer the best customer experience possible.

Choosing the right fulfilment option for your store

In terms of fulfilment options, Amazon sales can be managed in three different ways:
  1. Seller-fulfilled shipping: Selling partners are responsible for shipping, which may require additional staff if order volumes are high.
  2. Entrust the shipping management to a third party, i.e. a dropshipping provider: An option that avoids the need for additional staff or a warehouse with product inventory.
  3. Use the Fulfilment by Amazon service: Amazon offers the seller a comprehensive service, while also providing customer service and returns management.

Use Fulfilment by Amazon for product delivery

When you register as a selling partner with Amazon, you also sign up automatically for the Fulfilment by Amazon service for free. If you decide to use the service, your inventory will be sent directly to Amazon's fulfilment centres and you won't have to take care of shipping, customer service, refunds or returns.

What's more, with Fulfilment by Amazon, you'll also benefit from the one-day shipping service for Prime members on certain products, which will be a plus for your brand as the Prime badge will appear on your eligible products.

Advertise and promote your online store

Amazon also offers you advertising solutions with sponsored ads to help you achieve your growth strategy targets: Giving visibility to your brand, increasing sales and improving return on your advertising costs.
Advertising
Amazon Advertising provides you with four tools to achieve all of the above as a selling partner on Amazon:
  1. Sponsored Products: These are cost-per-click (CPC) ads that promote individual product listings on Amazon. They can help you reach high-intent shoppers who are actively searching for products like yours.
  2. Sponsored Brands: Showcase your brand and product portfolio with your logo and corporate image, a personalised title and a selection of your products to give them greater visibility.
  3. Sponsored Display: Allows you to reach relevant audiences by creating programmatic and self-service display ads with just a few clicks.
  4. Stores: Allows you to showcase your brand and products through various Amazon pages in an immersive shopping experience, where you can introduce your potential audience to everything about your story, your mission and your products.
Promotions
We have another key tool to accelerate your brand's growth: Promotions.

It's not rocket science that one of the main search criteria for customers is that the product in question be on sale, have a discounted price or something similar. This is especially true during specific seasons of the year, such as campaigns for Christmas, Black Friday or Prime Day, when many online businesses decide to launch special offers.

Creating an offer will therefore make your brand appear better positioned in searches, so you'll be making your brand known while increasing sales and maximising traffic to your store.

There are different types of promotions:
  • Flash Deals: A discount on the price of a product that only lasts for a few hours. These offers usually appear on the Amazon deals page, which is one of the most visited.
  • 7-Day Deals: In this case, the deal lasts for seven days, enough time to give visibility to the entire catalogue of a seller and their brand.
  • Vouchers: Discount on the price shown on the product detail page, which is applied directly to the buyer's basket.
Amazon Launchpad
If your online business is not an ordinary store, but you are an entrepreneur trying to launch and boost sales of innovative, unique or sustainable products on Amazon, the Launchpad programme is perfect for you.

Some of the advantages of Amazon Launchpad for startups include:
  • Strategic support
  • Customer engagement tools
  • Merchandising on Amazon
  • Global expansion
Make sure that you visit the link above if you'd like to read some success stories from this innovative programme.

Tax requirements in Spain for online selling partners

Since we know that tax aspects tend to be the most tedious to manage, we have compiled all the information that you need to know about tax requirements in Spain for online selling partners in one place, just for you: the Amazon VAT Knowledge Centre.

Here, we invite you to download the VAT manual, where you can learn about what it means, in which countries it applies, what it's for, what the tax rate is depending on the country (as this may vary), which products it applies to, etc.

Conclusion

Having all this information to hand will make it much easier for you to open your own online business. If you ultimately launch into the world of e-commerce, you can now decide if it's more advantageous for you to set up your online store independently or on Amazon.

Now you know a bit more about the advantages of creating an online business through Amazon, the programmes and selling plans it offers to selling partners to help them launch their brand, and all the tools you can find on the website to make searching for your niche in the market a little easier, at a time when competition is truly fierce and differentiation can be key to making an online business succeed.

If you would like to learn more about the e-commerce sector, Amazon can provide many more training resources to expand your knowledge in the field.

FAQ

Which selling plan is best for me if I sell more than 40 products per month?
If you sell more than 40 products per month, you're probably best signing up for the Professional plan, for which you'll pay €39 (excl. VAT) per month regardless of the number of products that you sell each month. You'll also need to pay additional selling fees, which apply to both the Individual and Professional plans.
How do I know if I'm a selling partner suitable for creating offers?
Currently, only selling partners on the Professional plan can list offers. In addition, the products that you want to apply an offer on must meet certain requirements, which you can find on the corresponding Help Page in Seller Central.
Which fulfilment method is most cost-effective in my case?
Amazon lets you try out the Fulfilment by Amazon Revenue Calculator, so you can compare different fulfilment methods. You can access the calculator using this link.
What is Value Added Tax (VAT)?
VAT stands for Value Added Tax. This tax is added to the price of products purchased in Europe and then transferred to the tax authorities of each country upon filing the tax return.
If you have already made the decision to sell through Amazon instead of through a personal domain, all you have to do now is start taking advantage of the services that Amazon offers its selling partners to protect their brands and prevent counterfeiting.

Start selling today

€39 (excluding VAT) per month plus selling fees
© 2023 Amazon.com, Inc. or its affiliates.
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