The Most Important Components of an eCommerce Business

The Most Important Components of an eCommerce Business

Setting up an eCommerce business is exciting. It is significantly different from running a brick-and-mortar business. Being an expert in it might not prepare you for an eCommerce business.

eCommerce can quickly scale and attract a large number of customers. As a business owner, you have to learn to build the right infrastructure to manage this inflow of business. Supply chain, inventory management, and customer support take a different shape online. Big profits are waiting if you master the skill and art of selling online.

We will help you understand the most important eCommerce business components to set up a successful business online. By the end of this article, you will be ready to take concrete steps to start your business.

1. Catalogue Management

Let us follow the simple logical flow of a customer going to your eCommerce site. The first thing they would look for is the product display.

Catalogue management is the art of showing your inventory to your customer in the most logical way. Searches on your site should show accurate results. Displaying products in an attractive way is a good eCommerce business strategy. Items with images sell two times more, according to various research studies.

Use smart recommendations to surface relevant products that your customers may not discover themselves. Make it easy to sort and filter the products. Your catalogue is the real money earner and one of the important eCommerce business components. The easier you make it to find the right product, the higher the chance of a sale.

Have a reliable payment gateway for online payments. Provide multiple payment options like a credit card, debit card, bank transfer, UPI, etc. Many customers want to pay after the delivery of the item. Provide a COD option for this purpose.

2. Supply Chain

You must be in a position to physically ship the sold item to the delivery address. Having strong supply chain management in place is one of the mandatory eCommerce business components. 

Letting the customer know that an item is out of stock after they make a payment is a bad experience. You will lose customers for mistakes like this. Pay close attention to activity on your website and maintain a healthy supply. Oversupply and undersupply are equally bad for your profits. 

Ensure your suppliers maintain high quality and meet the expectations you are setting on your website in line with your eCommerce business strategy. Be smart about your warehouse locations if you hold your own inventory. Align them with the places from where you are getting most orders to reduce your shipping costs. You can also deliver faster this way.

3. Shipping Services

Almost all of your business transactions happen online. However, you still have to physically deliver the product to your customers. Your shipping partners do this job. Recruit a reliable shipping partner. A good shipping company efficiently delivers products on time. 

Shipping services also need a robust return capability. Major eCommerce businesses experience about 15% of returns every day. Poorly executed return deliveries add to operational costs and reduce overall profit.

Shipping services are usually outsourced. Small and medium-sized companies rarely manage their shipping operations. Find a provider who has experience delivering your kind of products.

All shipping companies also have online tracking systems. Consider integrating the tracking system into your eCommerce site. This would improve customer experience and make it easy to buy products from you and is a good eCommerce business strategy.

4. Customer Service

We have now gone through the discovery, sale, and shipping aspects of your eCommerce business. Now let us look at customer service.

Things go wrong all the time, and customers have experiences that they do not expect. You have to provide a reliable channel for them to share their grievances. You have an option of either outsourcing or building your own customer support operations. Several companies specialise in providing dedicated customer experience services.

You build your eCommerce business strategy around what is allowed and what is not for your outsourced services. Work with your outsourcing partner to build logic for every possible query. You then determine what the expected outcome needs to be and how to handle exceptions.

Customer service is another one of the critical eCommerce business components. It can be email support, chat support, phone support, or all three of these modes. Depending on the size of your business, you can share your phone number or have an army handling all these channels.

5. Risk Management

Not all customer interactions are innocent. You will encounter experiences where people will take advantage of your loopholes. Weaknesses in your online buying logic or customer support will lead to people defrauding you. 

To avoid being scammed, you should have an eCommerce business strategy with a specific focus on understanding fraudulent activities on your site and finding ways to combat them. You have to work very closely with your outsourcing partner if you choose not to manage this independently. Not plugging holes can result in massive losses.


Setting up an eCommerce business can be a highly profitable venture. Customers predominantly buy goods online these days. An online business transcends boundaries and can expand your customer base exponentially.

For your benefit, we have summarised the article, so you get the most out of the tips we are sharing:

  • To be successful, you need a few eCommerce business components in place. These components should run efficiently and keep operational costs low. High operational costs will eat into your profits.
  • Set up a robust catalogue management system. Make it easy for your customers to browse your catalogue and discover products they want to buy.
  • Keep the products attractive and recommend more products to buy.
  • Set up a robust payment mechanism. Customers prefer paying through different modes.  Acommodate as many of these as possible as part of your eCommerce business strategy.
  • Finding the right supply chain model that works for you is one of the key eCommerce business components. Follow your data closely and maintain the right amount of inventory. Identify where your sales are originating from and try to keep your warehouses around these locations.
  • Find a robust shipping partner who can handle both shipping and returns efficiently and integrate a tracking system in your eCommerce site.
  • Do not ignore the importance of having a strong fraud detection system.
  • Finally, have a good customer support system in place. 

With all of these in place, you are off to a great start to set up your dream eCommerce business.

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