eCommerce Fundamentals

Learn the core concepts of eCommerce, platforms, product costing, packaging, shipping, and returns.

What Is eCommerce?

eCommerce stands for Electronic Commerce.

It means buying and selling products or services online.

Customers can visit a website, place an order, make an online payment, and receive the product at their location.

Today, eCommerce is used by businesses of all sizes.

eCommerce Platforms

Different platforms are available for creating an online store.

According to your class notes, some popular platforms are:

  • WooCommerce
  • Shopify
  • Magento
  • Instamojo
  • Other eCommerce platforms

Each platform provides different features for managing an online business.

WooCommerce

WooCommerce is a WordPress plugin.

It helps you convert a normal WordPress website into an eCommerce website.

To get better performance, your website should use:

  • WooCommerce compatible theme
  • WooCommerce compatible plugins

WooCommerce is widely used because it works with WordPress and provides flexibility for online stores.

Shopify

Shopify is a popular eCommerce platform.

According to your class notes, Shopify is considered a game-changing platform for eCommerce businesses.

However, Shopify requires a monthly subscription.

Many additional integrations are also paid.

Because of this, many beginners choose WooCommerce for creating their online stores.

Understanding Product Cost

Before selling a product, businesses should understand all costs involved.

The total product cost may include:

  • Raw material cost
  • Manufacturing cost
  • Packing cost
  • Delivery cost
  • Taxes
  • Platform charges
  • Payment gateway charges
  • Business maintenance costs

These costs help businesses decide the final selling price.

Packing and Logistics

After preparing the product, it should be packed properly.

Packaging materials may include:

  • Cardboard boxes
  • Polythene covers
  • Bubble wrap

The delivery cost depends on:

  • Customer location
  • Product weight
  • Product dimensions
  • Delivery distance

Proper packaging helps protect the product during transportation.

Shipping and Delivery

Shipping companies help businesses deliver products to customers.

According to your class notes, Shiprocket is used as a shipping aggregator.

The shipping cost depends on:

  • Length
  • Width
  • Height
  • Weight
  • Delivery location

Different delivery partners may be selected based on the shipment requirements.

Returns and Exchanges

Returns and exchanges are important parts of an eCommerce business.

Sometimes customers may return or exchange products.

According to your class notes, businesses should clearly define their return and exchange policies.

A clear policy helps customers understand the rules before placing an order.

Payment and Business Setup

Understand GST, payment gateways, verification documents, charges, and shipping wallet systems.

Understanding GST

GST stands for Goods and Services Tax.

It is a tax collected on goods and services in India.

Businesses must understand GST before selling products online.

What Is an HSN Code?

HSN stands for Harmonized System of Nomenclature.

It is a code used for classifying products.

According to your class notes, an example HSN code is:

  • 4202

Different products have different HSN codes.

CGST, SGST, and IGST

According to your class notes:

If a business sells within the same state, GST may be divided into:

  • CGST
  • SGST

If the transaction is between different states, IGST is applicable.

The applicable tax depends on the business transaction.

Payment Gateway

A payment gateway helps customers make online payments.

According to your class notes, some popular payment gateways are:

  • PhonePe Business
  • Razorpay
  • Cashfree
  • CCAvenue
  • Instamojo

Payment gateways securely process online payments between customers and businesses.

Documents Required for Payment Gateway Verification

Before activating a payment gateway, businesses must submit verification documents.

According to your class notes, the required documents include:

Business Documents

  • GST
  • PAN
  • Government business registration certificate
  • Udyam Registration
  • Startup Registration
  • MCA Registration
  • LLP or Private Limited documents

Bank Documents

  • Bank statement
  • Website
  • Business website
  • Domain verification using the official email address

Personal Documents

  • Aadhaar
  • PAN
  • Authorized Person Details
  • Authorized email
  • Mobile number
  • Signature
  • Company seal

After document verification, the payment gateway account is approved.

Payment Gateway Charges

According to your class notes, payment gateways such as PhonePe, Razorpay, and Cashfree generally charge:

  • 2% + GST

These charges are deducted for processing online payments.

Shiprocket Wallet System

According to your class notes, Shiprocket works using a wallet system.

The wallet is recharged before creating shipments.

When an order is received from a WordPress website, the shipping amount is deducted from the wallet after booking the shipment.

Why Businesses Should Use Two Payment Gateways

According to your class notes, every business should maintain two payment gateways.

Having more than one payment gateway helps businesses continue accepting payments if one service is temporarily unavailable.

Conclusion and Key Takeaways

A summary of everything covered in this beginner guide to eCommerce.

Conclusion

eCommerce allows businesses to sell products and services online. A successful online store requires the right eCommerce platform, payment gateway, shipping partner, and proper business documentation.

Understanding WooCommerce, Shopify, GST, HSN codes, payment gateway verification, shipping, and logistics helps businesses build a strong foundation for managing an online store.

Key Takeaways

  • eCommerce means buying and selling products or services online.
  • WooCommerce is a WordPress plugin for creating eCommerce websites.
  • Shopify is a popular eCommerce platform with paid plans.
  • Product pricing includes packing, delivery, taxes, and other business costs.
  • Shiprocket helps businesses manage product shipping.
  • GST is the Goods and Services Tax used in India.
  • HSN codes classify products for taxation.
  • Payment gateways process online payments securely.
  • Business verification documents are required before activating a payment gateway.
  • Maintaining two payment gateways helps businesses avoid payment interruptions.

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