What Does It Cost to Run an Online Store in India?
The recurring costs behind an online store, beyond the build price.
What does an online store cost to run?
Running costs include platform subscription or hosting, payment gateway percentages on every order, shipping costs, packaging, returns handling, app or plugin subscriptions, and marketing to generate demand. For most stores, gateway fees and shipping together exceed the platform cost considerably.
Store budgets usually account for the build and underestimate everything that recurs. These are the costs that continue after launch and determine whether the store is actually profitable.
What are the fixed monthly costs?
Platform subscription or hosting, domain renewal, any paid apps or plugins, and maintenance if you are self-hosting. These are predictable and usually the smallest part of the total once the store is trading.
App subscriptions accumulate quietly. Auditing them twice a year typically finds several that are no longer used.
What are the per-order costs?
Payment gateway fees as a percentage of order value, shipping cost, packaging, and a provision for returns and failed cash-on-delivery deliveries. In some categories return handling is a larger cost than the gateway fee.
Cash on delivery carries a specific cost in refused deliveries and return shipping, which should be modelled per category rather than averaged.
How much should I budget for marketing?
Enough for one channel to produce readable data. A store with no existing audience needs continuous acquisition spend, and this is usually the largest ongoing cost of all. Budget it as a core operating cost rather than an optional extra.
Calculate what you can afford to pay per order by working back from margin. That number, not a percentage of revenue, is what should govern acquisition spend.
What about GST and compliance costs?
GST registration and filing, accounting support, and correct invoice handling. These are routine business costs but should be planned, particularly if you sell across states or through marketplaces where compliance requirements differ.
Rules vary by category and turnover and change over time. Get specific advice from a chartered accountant rather than working from general guidance.
How do I know if the store is profitable?
Calculate contribution per order: selling price minus product cost, gateway fee, shipping, packaging, expected return cost and acquisition cost. Many stores with growing revenue have negative contribution and discover it late.
Do this per product category rather than overall. Averages routinely hide categories that lose money on every order.
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