India’s E-commerce landscape has rapidly expanded due to increased internet access, revolutionizing business practices and altering the global market. E-commerce in India involves online sales and services, offering benefits like lower costs and more choices to consumers. This sector relies on digital technologies for quick transactions, including the Internet and mobile
What is an E-commerce Company?
An E-commerce company in India operates as a digital marketplace, facilitating the online exchange of goods and services, along with monetary transactions, over the internet. These transactions can vary:
- B2B (Business-to-Business): Transactions between businesses.
- B2C (Business-to-Consumer): Direct sales from businesses to the end consumer.
- C2C (Consumer-to-Consumer): Transactions between consumers, typically facilitated by a third-party platform.
- C2B (Consumer-to-Business): Consumers offer products or services to businesses.
With the growing penetration of the internet and smartphones, the number of Ecommerce businesses in India is rapidly increasing. This has made starting an eCommerce business an attractive venture for the country’s burgeoning young entrepreneurial base, primarily due to its low capital requirement.
Is company registration required for Online Sellers?
Today, most of the customers do not visit the retail shops and aren’t at the mercy of the traders selling a particular merchandise. The current scenario of online shopping has in a true sense transformed the market and has become a customer-centric market from a seller-centric.
Why Is It Necessary To Register Online Company?
Basically, if you’re doing any business are required to register such business either as a Company or a Firm or an LLP (Limited Liability Partnership). Instead of going for company registration, you could register the business as a Sole proprietorship. If your objective is to sell goods through online marketplaces or create your own web store, then consider for proprietorship while indulging in the retail business.
A proprietorship is a business form which is run by a sole person and wherein there isn’t any key distinction between the business and the owner. The owner has the direct control of every element of the business and is accountable for all the finances of that business and might include loans, debts, loss etc.
When doing online business, you have to maintain a current account in the name of your business. To do this, you need to ensure that your business is a legal entity. To prove this, you get registered with the taxation authorities and also obtain establishment license.
For your web store to gather online payment, you need to register your business. This method will permit you to integrate your site with the recognized gateway. Furthermore, registering online proprietorship assists you to avoid hassles and confusions with the law & the registered business is likely to receive more trust.
Documents needed for starting Sole proprietorship business
- PAN card (Permanent Account Number) and valid government recognized ID proof (passport, voter card, aadhar, etc.) of the proprietor
- Bank statement or a copy of a cancelled cheque
- Copy of electricity bill/ landline bill, water bill
- NOC (No objection certificate) of the Proprietor/owner
- Rental agreement (if premises are rented)
- Declaration to comply with the provisions
FAQs
Benefits of Starting Ecommerce Business in India?
- Access to a Vast Market: India’s large and growing internet user base offers a vast market for eCommerce businesses. With over 560 million internet users, the potential customer base is expansive and diverse.
- Lower Operational Costs: Ecommerce businesses often incur lower operational costs than traditional brick-and-mortar stores. Savings come from reduced need for physical space, lower personnel costs, and efficient supply chain management.
- 24/7 Business Operations: Unlike physical stores with fixed hours, e-commerce platforms operate 24/7, allowing customers to shop at their convenience and businesses to generate sales around the clock.
- Easy Market Entry: Starting an e-commerce business in India is relatively easier and less capital-intensive than setting up a physical store. This ease of entry encourages entrepreneurship and innovation.
- Scalability: Ecommerce businesses can scale up or down quickly in response to market demand without significant investment. This flexibility allows for rapid growth and expansion.
- Data-Driven Insights: E-commerce platforms can collect valuable data on customer behaviour, preferences, and purchasing patterns, enabling businesses to tailor their offerings and marketing strategies effectively.
- Wide Range of Products and Services: E-commerce enables businesses to offer a wider range of products and services without the limitations of physical shelf space, meeting diverse customer needs.
- Global Reach: An e-commerce company in India can reach customers domestically and internationally, opening up global markets without the need for a physical presence abroad.
- Personalized Customer Experience: E-commerce platforms can provide personalized shopping experiences through customized recommendations, deals, and customer service, enhancing customer satisfaction and loyalty.
- Contribution to Digital India: By participating in the e-commerce sector, businesses contribute to the Digital India initiative, promoting digital literacy, infrastructure, and economic growth.
- Government Support: The Indian government offers support and incentives for digital businesses, including e-commerce, through various policies and initiatives to boost the digital economy.
- Environmental Benefits: E-commerce can be more environmentally friendly than traditional retail through efficient logistics, reduced material use, and digital transactions, contributing to sustainability.
Becoming a Seller on Established E-commerce Platforms
- Business Registration: Formalize your business entity, whether a sole proprietorship, partnership or private limited company, to ensure legal compliance and professional credibility.
- Trademark Registration: Secure your brand name and logo to protect your identity and prevent potential infringement.
- GST Registration: Mandatory for selling online in India, GST registration ensures tax compliance and enables you to issue GST invoices.
- Bank Account: Open a dedicated business account in the name of your registered business for financial transactions.
- Product Listings and Fulfillment: Prepare detailed product listings with high-quality images and descriptions. Familiarize yourself with the platform’s fulfilment processes, whether you’ll handle shipping yourself or use the platform’s fulfilment services.