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How to start an online store: a step-by-step launch checklist for 2026

· 12 min read · Getting Started

Short answer: To start an online store, you pick a product and check that people will pay for it, set up your business (most people start as a sole proprietor or an LLC), get the tax IDs and licenses your state and city require, and open a business bank account. Then you choose a platform and a domain, add your products and store policies, connect payments, set your shipping rates and delivery promise, place a few test orders and launch. Most of the work is in the order of the steps, not any single one. If you want to see from day one whether each sale actually makes money, start on an e-commerce platform that shows the real profit on every order, after shipping and payment costs.

Step 1: Choose what to sell, and test it first

Every other decision depends on the product: your shipping costs, your margins, which licenses you might need, and how you'll find customers. Before you build anything, check three things:

  • Demand: are people already searching for it or buying similar products?
  • Margin: after product cost, shipping, payment fees and the cost of winning a customer, is there money left?
  • Shippability: is it light, sturdy and legal to ship to the places you want to sell?

We walk through research methods and a margin worksheet in how to find products to sell online. Start with a small batch or a handful of products; you can widen the range once you know what sells.

Step 2: Pick a business structure

You don't need a company to start, but you should know what you are by default. According to the SBA, if you do business and don't register any other structure, you're automatically a sole proprietorship. That's simple, but there's no legal separation between you and the business: you can be held personally liable for its debts and obligations.

  • Setup — Sole proprietorship: Automatic once you start doing business; LLC: Registered with your state
  • Personal liability — Sole proprietorship: You're personally liable for business debts; LLC: Protects your personal assets in most cases
  • Taxes — Sole proprietorship: Business income on your personal return; LLC: Profits and losses can pass through to your personal income; members pay self-employment tax
  • Good fit — Sole proprietorship: Testing an idea, low risk, one owner; LLC: Inventory, partners, higher sales, or products with liability risk

Many stores start as sole proprietors and form an LLC once sales are steady. If you sell products that could hurt someone, or you're investing serious money in stock, talk to an accountant or attorney before you launch.

Step 3: Get your tax IDs, licenses and permits

  • EIN: the IRS says you never have to pay a fee for an Employer Identification Number, and if your online application is approved, the number is issued immediately. You need one if you hire employees or operate as a partnership or corporation, among other cases. Sole proprietors without employees can often use their Social Security number, but some get a free EIN anyway so they don't have to hand out their SSN to suppliers.
  • State tax registration and sales tax: the SBA notes that tax obligations, including sales tax, vary by state and locality. Check your state revenue department's website to see whether you need to register and collect sales tax before your first sale.
  • Licenses and permits: the SBA says most small businesses need a combination of federal and state licenses and permits. Federal ones apply to specific regulated activities; states regulate a broader range, and cities and counties often regulate retail. If you run the store from home, zoning rules can still apply. Note renewal dates, because some permits expire.

Step 4: Open a business bank account

Keep business money separate from day one. Payouts from your payment provider land here, and your bookkeeping gets much simpler. The SBA lists an EIN, or a Social Security number for sole proprietors, among the documents a bank will ask for.

Step 5: Choose your platform and domain

You need three things: a platform that hosts your store and checkout, a domain name, and a simple brand (name, logo, colors). When you compare platforms, look past the monthly fee:

  • Transaction fees the platform takes on top of payment processing.
  • What's included: hosting, SSL certificate, backups and updates, or extra apps you'll pay for.
  • Checkout: which payment methods it supports and whether shipping rates show before the last step.
  • Reporting: can you see profit per order, not just revenue?

Pick a domain that's short, easy to spell and matches your store name.

Step 6: Build the pages customers check before they buy

  • Product pages: clear photos, an honest description, price, stock status and shipping cost or delivery estimate.
  • Shipping policy: where you ship, how fast, and what it costs.
  • Returns and refunds policy: how long customers have, who pays return shipping, and how refunds are paid.
  • About and contact pages: a real email address and, ideally, a business address. New stores win trust by being easy to reach.
  • Privacy policy and terms: what data you collect and the terms of sale.

Step 7: Set up payments

Connect a payment provider to your checkout so card details go straight to the provider's secure page and never touch your server, and add at least one wallet customers already use. We cover providers, fees and PCI basics in how to accept payments on your website.

Step 8: Plan shipping and keep your delivery promise

Decide your shipping rates (flat, free over a threshold, or calculated by weight) and your carriers before launch. Then make a promise you can keep. Under the FTC's Mail, Internet, or Telephone Order Merchandise Rule, if you state a shipping time you need a reasonable basis for it; if you don't state one, you must expect to ship within 30 days of the order. If you can't ship on time, you have to tell the customer and offer the choice to accept the delay or cancel for a prompt refund. Refunds for cancelled orders paid by card through a third party are due within seven working days. The FTC lists civil penalties of up to $53,088 per violation, so keep your "ships in 2 days" banner honest.

Step 9: Test everything, then launch

Before you announce the store, run through it as a customer:

  1. Place a test order with a real card and refund it.
  2. Check the order confirmation email and the shipping notification.
  3. Open the store on a phone, not only on a laptop.
  4. Print a shipping label and pack a real parcel to check weight and box size.
  5. Submit your products to Google's free listings through Merchant Center. Google notes that this gives permission to show your products for free across Search, the Shopping tab, Images and YouTube, but doesn't guarantee they'll appear.

Then launch to the people who already know you, ask your first buyers for honest feedback, and fix what slows them down.

Your launch checklist

  • Product tested for demand and margin — Before you launch: Products, policies and contact page live; Launch week: Tell your existing audience
  • Business structure chosen — Before you launch: Payments connected and tested; Launch week: Submit products to free listings
  • EIN, state tax registration, licenses checked — Before you launch: Shipping rates and delivery promise set; Launch week: Ask first buyers for feedback
  • Business bank account open — Before you launch: Test order placed and refunded; Launch week: Review profit per order

How Favenda helps

In Favenda you set shipping rates by weight or by size, add a free shipping threshold, and give each sales region its own currency, payment methods and shipping rates. For international orders, DHL Express, UPS and FedEx are built in: labels print from the order screen, a commercial invoice is created with the shipment, and tracking updates automatically. Each order shows real profit after shipping and payment costs, so from your first sale you can see whether your prices work. There are no transaction fees on your sales. The Store plan is $69 a month excluding tax, with two months free when you pay annually.

See Favenda →

FAQ

Can I start an online store with no money?
You can start with very little, but not with nothing. At minimum you'll pay for a domain and a store platform, and you need stock or samples to sell, unless you make products on demand. Keep the first range small, test demand before you buy inventory, and use free channels such as Google's free listings before paying for ads.

Do I need an LLC to start an online store?
No. According to the SBA, you're automatically a sole proprietor once you start doing business, and many stores begin that way. An LLC adds protection for your personal assets in most cases, which matters more as sales, stock and risk grow.

How long does it take to start an online store?
The store itself can be set up in days. What takes longer is the groundwork: testing products, registering for taxes and licenses, getting a payment provider approved and agreeing on shipping. Run those steps in parallel and you avoid waiting on one before starting the next.

Sources: U.S. Small Business Administration, "Choose a business structure", "Apply for licenses and permits" and "Get federal and state tax ID numbers"; IRS, "Get an employer identification number"; Federal Trade Commission, "Business Guide to the FTC's Mail, Internet, or Telephone Order Merchandise Rule"; Google Merchant Center Help, "Free listings". All read on 24 October 2026. Rules vary by state and city; check with your state and local agencies, and an accountant or attorney, before you launch.