If you have been thinking about how to start an online shop in Uganda, we have surely got you covered. When you start an online shop in Uganda, you can reach a wider audience and increase your business revenue.
Looking at the top-ranking websites in Uganda in terms of traffic, you will notice that online shopping websites like Jumia Uganda, Ubuy, and Jiji Uganda top the list. This indicates that Ugandans are getting more comfortable purchasing goods and services online. The e-commerce industry in Uganda is growing, and it is important that you take advantage of this opportunity.
If you have products and services to sell to Ugandans, one of the most innovative ways to reach your target market is to set up an online store that is unique to your business. Your store doesn’t necessarily need to be as big as Jumia Uganda. You can set up a store that offers only one or a few products. You can create an online store that sells specialized products like computers, clothes, shoes, flowers, perfumes, phones, auto spare parts, etc. Your online store might not become as popular as Jumia but be assured that you will make money big time with the right strategies.
Starting an online store in Uganda is a simple task; however, the process can be a bit challenging, especially if you are new to online businesses and how much knowledge about how websites work. This article will take you through a step-by-step guide to starting an online store in Uganda, from writing a business plan to building a website and promoting your store.
Whether a total beginner or a small retail shop owner that wants to get their business online, this guide will provide you with all the information you need to get your online store up and running. Read on to learn more…
Also read;Top 16 Online Shopping Sites in Uganda 2024
Interesting statistics about e-commerce / online shopping in Uganda
Here are some of the statistics available about online shops and e-commerce in general:
- In 2020, global ecommerce sales reached $3.9 trillion, and it is expected to reach $6.5 trillion in 2023.
- The ecommerce trade is growing rapidly in Uganda. The number of online shoppers is expected to reach 2.1 million from 1.5 million in 2019.
- According to a report by the Uganda Communications Commission (UCC), mobile phone-based e-commerce transactions in Uganda rose from UGX 12.3 billion ($3.5 million) in 2019 to UGX 131.3 billion ($36.5 million) in 2020.
- Online sales in Africa are expected to hit $75bn by 2025, and the number of online shoppers is expected to reach 180M – report by Google, Temasek and Bain Company.
- The most popular online shops in Uganda include Jumia, Jiji, Ubuy, Kilimall, and Condala. These shops generate significant sales monthly.
- According to Global Online Consumer Report, electronics, clothing, and home appliances are most purchased online in Uganda.
Also read;The state of ecommerce in Uganda in 2024
Why should you start an online store in Uganda? (Benefits, Advantages, Pros)
We are living in a digital era where everything is now going online. With the emergence of ecommerce trade, businesses are no longer defined by their geographical boundaries. In the classic era, the only way people could get to know about your business was when they passed by your business place and saw a small signpost with your business name. Today, this is a thing of the past as business can be easily accessible online with just a tap of a button.
Nowadays, almost everyone owns a smartphone and can access the Internet from literally anywhere. And for this reason, moving your business online would bring it closer to millions of Ugandans looking to purchase goods and services online. The Internet allows you to reach more people than you would reach with a traditional brick-and-motor shop.
An online store also allows businesses to operate 24/7, meaning customers can purchase products anytime, anywhere, even when the physical store is closed. This can increase sales and revenue for the business.
Also, setting up an online shop can be relatively low-cost compared to opening a physical store since rent and warehouse expenses are eliminated. But like a conventional storefront, you need capital to start an online store. Statistically, an online store managed the right way stands a higher chance of making more profits than a conventional store.
Many Ugandans entrepreneurs have embraced this internet trade and are already earning big from it.
Also read;How to sell online in Uganda
Steps to start an online store in Uganda
If you are new to the online world of business, it can be challenging to know how to get started or which direction to take. Below is a step-by-step guide on how to start an online store in Uganda.
- Decide what you want to sell
- Develop a business plan
- Choose a name for your online shop.
- Register your business
- Pick a domain name and buy web hosting.
- Build your website
- Setup a payment gateway and receive payments
- Stock your store
- Establish a Shipping/Delivery Plan
- Test your store before the launch
- Launch Your Store
- Promote Your Store
Also read;13 Reasons to Shop Online in Uganda
Step 1: Decide what you want to sell.
The first step in starting an online shop in Uganda is deciding on the products you want to sell. If you already have a physical store, you may have existing products to sell online. However, if you are starting from scratch, it’s essential to research and identify marketable products that are in demand by your target audience.
Choose products that align with your target audience’s needs and preferences. To succeed in an online business, you must sell what people are searching for, not just what you want to sell.
Take the time to research gaps in the market and understand what your target audience is searching for online. For example, if your target audience is looking to buy clothes online, focus on selling a variety of clothing options, rather than trying to sell unrelated products like computers.
Finding the right products to sell online is crucial to starting an online shop in Uganda. It requires research and understanding of your target audience and market trends, but it will set the foundation for the success of your online shop.
Here are some of the product ideas you can sell online in Uganda:
- Electronics
- Fashion
- Handmade crafts
- Wearables, e.g., watches
- Beauty products
- Food delivery
- Home use items
- Jewelry
- Footwear
- Eyewear
- Baby products
- Herbal products
- Natural Nutritional Supplements
- Technology devices
- Hair products
- Mobile makeup
- Beverages
- Agricultural produce
- Second-hand products
- General Merchandise
- Books (bookstore)
Step 2: Develop a business plan.
Developing a comprehensive business plan is important in starting any business, including an online shop. A business plan helps to outline your business objectives, target market, and financial projections. It also enables you to identify potential obstacles and develop strategies to overcome them. Whether you are seeking funding from investors or not, having a well-crafted business plan will guide you in making your online shop successful. When developing your business plan, consider the following key elements:
- Marketing strategy and its associated costs.
- The cost of developing a website (online shop).
- Taxes, such as URA tax and website/domain annual renewal fees.
- Employee wages, if applicable.
- Shipping costs and how orders will be delivered to customers.
- Production costs if you plan to manufacture products yourself.
Step 3: Choose a name for your online shop.
Choosing a name for your online shop is an essential step in creating the image of your business. A name can make or break your business, so it is important to choose one that is simple, short, brandable, and descriptive of your online shop. A brandable name can also be any word without a specific meaning, but it should be memorable, such as Jumia or Zolanda. A good shop name can help attract customers, establish a brand identity, and improve visibility on search engines such as Google, Bing, and Yahoo Search. When choosing a name for your online shop in Uganda, consider the following key factors:
- Uniqueness: Ensure that other businesses do not already use the name.
- Memorability: The name should be easy to remember and easy to pronounce.
- Simplicity: The name should be simple, catchy, and easy to pronounce.
- Relevance: The name should be relevant to the products or services you offer, creating a clear connection between your name and your business.
- Brandability: The name should be catchy and easy to remember.
- Flexibility: The name should be flexible and adaptable for the future expansion of your business.
- Domain Availability: The name should be available for registration as a .com domain.
Tip: For optimal SEO performance, it is recommended that your store name aligns with your domain name. For example, if your store name is “My Shop,” your domain should be www.myshop.com if it is still available for registration.
Step 4: Register your business.
Once you have chosen a name for your online shop, it is important to register it with the relevant authorities to operate legally and acquire the necessary operational licenses. While it may be optional to register an online shop in Uganda before its operation, any organized and credible business should be registered.
Avoiding registration and taxes may seem like a way to save money to many people, but it is a serious offense that can attract heavy penalties or result in the closure of your business if caught by authorities. Also, some customers may be hesitant to buy from an unregistered business, as it may be perceived as illegitimate.
Registering a business name in Uganda costs UGX 50,000 while registering a limited company costs UGX 130,000. If your business is registered, it will be acknowledged as a legal entity, making it easier for customers to trust your business and also easy to obtain funding from investors, traditional banks, or local credit unions.
Here are the general steps to register a business with the Uganda Registration Services Bureau (URSB):
- Choose a unique and appropriate business name and reserve it via the URSB website for UGX 20,000
- Fill out the business registration forms, which can be obtained from the URSB website or office.
- Pay the registration fee of UGX 50,000 for a business name or UGX 130,000 for a limited company and submit the completed forms and required documents.
- Wait for approval, which typically takes a week or two.
- After approval, collect your business registration certificate from URSB.
- Obtain a TIN from the Uganda Revenue Authority website.
Step 5: Pick a domain name and buy web hosting.
In simple terms, a domain name is the address of a website on the Internet. It’s the name that people type into their web browser to access a website. For example, the domain name of Condala is “condala.com,” and the domain name of Jumia Uganda is “jumia.ug”.
Think of it like a street address for a house. Just as a street address helps people find a specific house, a domain name helps people find a specific website.
When starting an online shop, you must choose a unique domain name that someone else has not registered. Once you have selected a domain name, register it with a domain registrar. Some popular domain registrars include:
The best domain extension is .com. However, if your shop only targets the Uganda audience, you can choose the .ug domain. Dotcom (.com) domains go for an average of $12 (UGX 45,000), while Dotug (.ug) domains go for an average of $25 (UGX 100,000).
A good domain name must have the following characteristics:
- Short and easy to remember (not exceeding 15 characters)
- Unique and not already taken
- Relevant to the website content
- Easy to spell and pronounce
- Brandable, e.g., Apple.com or Amazon.com
- Available in the .com top-level domain
- Does not contain any hyphens or numbers
- Reflects your business identity
Once you have chosen the domain you want to register, it is now time to buy web hosting and get your shop online. So, what is web hosting? Web hosting is a web-based service that allows you to store your website files on a powerful computer known as a server so that anyone on the Internet can access it.
Think of web hosting like renting a space to store your things. Just as you need a place to store your clothes, food, furniture, and other belongings, a website needs a place to store its files, images, and videos. This place is called a server, and it is what makes your website accessible to people all over the world.
When you create a website, you need to find a web hosting provider that will store your website files on their server. Some examples of top web hosting providers are:
Tip: You will get a special price discount when you purchase your hosting through the above links.
A good web hosting service goes for an average of $65 (about UGX 250,000/-). The good news is that most top web hosting providers offer a free .com domain to their first-time customers. This means when you buy web hosting from a web hosting company like Bluehost or Hostgator, you will get a free domain.
I do not always encourage anyone to host their website or online store with local web hosting companies in Uganda because of their record of unprofessionalism, unreliability, and poor support. Look for a global hosting provider that is credible and reputable.
When choosing a web hosting provider, go for a company that offers the following services:
- Fast and reliable
- 24/7 customer support
- Offers features you need to run your online shop
- Has a 99% uptime
- Offers adequate storage and bandwidth
- Offers cPanel or other control panel options
- Regular backups
- SSL certificate included in the hosting plan
Step 6: Build your website.
Once you’ve registered a domain and purchased web hosting, it’s now time to build your website for your online store. To run any online store, you must have a website. There are various ready-made ecommerce solutions or tools you can use to build your online store, even if you have no coding knowledge.
These solutions usually come with pre-built websites that can be used with drag-and-drop features, making it easy and fast to set up an online store. One of the most popular ecommerce solutions for creating online stores is Shopify. Shopify is easy to use, and anyone can get started with it. Other best ecommerce platforms for setting up an online store include:
Using ready-made ecommerce solutions is a short-term solution as most of them come with limited features and limited customization capabilities. They also attract monthly or annual fees, which may be costly for beginners. For example, Shopify’s basic plan costs $24 (about UGX 90,000) per month and $288 (about UGX 1,100,000) per year. The good thing with Shopify is you don’t need to buy a domain and hosting separately as everything is included in one package.
Alternatively, if you cannot afford ready-made commerce solutions like Shopify and you are not a web developer, you will need to hire a professional web designer in Uganda, so they can create an online store for you using premium WordPress ecommerce templates/themes.
The developer can also create a website for you from scratch based on your store requirements and functions. However, note that building a website from scratch is more costly than building it using premium themes/templates. So, define your budget accordingly.
Premium ecommerce themes at Themeforest go for an average of $59 (about UGX 230,000). This cost excludes hosting, domain, and the web designer’s labor costs.
Most website designers in Uganda charge UGX 700,000 for basic theme-based websites. If you want a custom-built website, be ready to part with a minimum of UGX 1,500,000 (basic).
Build a website that only has features your store needs, and it must allow room for your business to grow, i.e., it must be scalable and upgradable.
A good online shop website should have the following qualities:
- A clean, simple, and uncluttered design that is easy to navigate
- A consistent and coherent layout throughout the website
- A visually appealing and professional aesthetic that reflects the brand
- Clear and easy-to-find call-to-action buttons
- A responsive design that adapts to different screen sizes and devices, both mobile and desktop
- An easy-to-use search and filtering system
- A well-organized and easy-to-find product categories
- A clear and easy-to-read typography
- Visually appealing and high-quality product images and videos
- A seamless and secure checkout process
- Integration with social media platforms
- SEO optimized to rank well on search engines
- Good customer support with multiple communication channels
- Fast and reliable shipping options with tracking
Tip: If you’re looking for a skilled online store designer in Uganda, consider contacting ICT Guys Ltd. You can contact them via WhatsApp at +256797326164. Keep in mind that you also have the option of hiring a different skilled developer or web design agency of your preference.
Also read; How to start an online store in Uganda
Step 7: Set up a payment gateway and receive payments.
Now that you’ve created your online store website, it is ready for customers to visit and begin making orders. However, in order to collect payments, you’ll need to register for an ecommerce payment system. This system will be integrated into your online store, allowing customers to pay for their purchases online through your website/store.
If you built your shop on ready-made ecommerce solutions like Shopify, you will find everything you need in one package, including payment systems, and you’ll need to select the most suitable options.
If your shop is built on WordPress or was custom-built from scratch, you will need to find and integrate a third-party payment system, which your developer will incorporate. Keep in mind that to use these payment systems on your site/store, you must be a registered business, and you will be required to submit your business registration documents.
The most popular online payment systems in Uganda include:
- Mobile Money
- Credit/Debit Card payments
- Pesapal
- Flutterwave
- EasyPay
- PayPal (If you have a supported account)
However, due to the high number of scams and skepticism Ugandans have towards paying online while shopping online, most Ugandans prefer placing orders online and paying cash on delivery. This is because some unscrupulous online sellers have taken advantage of Ugandans by receiving cash before delivery, only to fail to deliver or deliver something different from what was ordered. If your customers are primarily Ugandans, to increase your sales, it is recommended that you set cash on delivery as the default and primary payment method.
Also read; Top 7 Payment Methods for Online Shopping in Uganda
Step 8: Stock your store
Now that your website is set up, it is time to start stocking your store with products that customers can purchase. Choose products that are in high demand and can be easily sourced at competitive prices. This means selecting products with a strong customer base and are likely to sell well. For example, if you are starting an online clothing store in Uganda, consider stocking popular clothing items such as t-shirts, shirts, jeans, and hoodies. These are some of the items that are commonly worn and are in high demand in Uganda.
Find suppliers who can provide you with products at a price that allows you to make a good profit while still being competitive with other sellers. For example, if you are starting an online electronics store in Uganda, you should look for suppliers who can provide you with popular electronics such as computers, phones, and tablets at competitive prices. This would allow you to sell these products at a price that is competitive with other stores while still making a good profit.
It is also important to consider the quality of the products and the supplier’s reputation. A good product supplier should have a good reputation for quality products and also good customer service. They should have the ability to provide you with products that are of excellent quality, and that will meet the expectations of your customers. Selling poor-quality products can hurt the reputation of your online store and will make you lose customers.
Additionally, it is not necessary to physically have all the products listed on your store in stock. You can research and identify the product and its supplier and only source it from the supplier when a customer orders that specific item. This approach is used by most store owners in Kampala. It is especially advantageous for those with limited capital, as it eliminates the need to stock a large number of products in a warehouse. The same approach applies to those running dropshipping stores.
Here are a few places you can source your products:
- Local Chinese and Indian suppliers in Kampala
- Local manufacturers
- Suppliers in China
- B2B platforms like Alibaba
Step 9: Establish a Shipping/Delivery Plan
Before you begin accepting orders, it’s important to consider how those orders will be delivered to customers. Delivery is a crucial aspect of your online store’s operations and requires careful planning. Establish a robust delivery system that ensures customers receive their orders on time. You can implement an in-house delivery system or partner with a third-party delivery company.
If your store targets a small geographical location, such as Kampala and its surrounding areas, you can establish an in-house delivery system. This could involve delivering orders with your personal car, a newly-purchased motorbike or vehicle dedicated to deliveries, or a hired vehicle or motorbike. For a start, if you can afford it, you can purchase one motorbike and employ a delivery boy to deliver customer orders on this motorbike.
If you are targeting a larger geographical area, such as the whole of Uganda, and are unable to set up your own in-house delivery system, you can partner with bus couriers to deliver your orders nationwide. Bus companies that deliver packages include:
- Link Buses
- Easy Coach Buses
- Global Packaging Courier by Global Buses
- K.K. Coaches
- Y.Y. Coaches
Also, consider partnering with reputable last-mile delivery companies to deliver your orders. Popular last-mile delivery companies include:
- CourieMate
- Uganda Post Limited (UPL)
- Sendy
- Prime Couriers
- Nation Couriers
If your store sells products globally, consider partnering with reputable global couriers such as DHL, FedEx, EMS, UPS, and Aramex.
It’s important to research and compare the different options available to find the best fit for your business in terms of cost, speed, and reliability. Make sure to clearly communicate your delivery options and estimated delivery times to customers on your website, so they are aware of what to expect when placing an order.
Step 10: Test your store before the launch.
Before launching your online store, it is essential to thoroughly test-run it to ensure it is functioning correctly and without any errors or bugs. This step is crucial as launching a website with technical issues can create a negative first impression for potential customers, potentially damaging your business reputation. During the testing phase, pay close attention to the following:
- Is the website mobile responsive and properly displayed on different devices?
- Are there any technical errors or bugs that need to be fixed?
- Are all links redirecting to the correct pages?
- Does the checkout process work smoothly without any issues?
- Are payments processed successfully and without any errors?
- Is the website’s overall user experience (UI/UX) smooth and seamless?
Note: It is important to keep in mind that if you are not technically inclined, this step may require the help of your web developer or another technical expert in the ecommerce field. Having a few people test the store and provide feedback to identify and fix any glitches is also recommended. Once all issues have been resolved, your online store will be ready for launch.
Step 11: Launch Your Store
After completing all the necessary steps to set up your online store, it is now time to prepare and launch it for the public.
You can begin by planning a soft launch, where you can test-run the store with a small group of people to address any issues before going live.
Then, schedule a specific date and time for the launch. Build anticipation by creating a “coming soon” landing page and running a pre-launch campaign.
To create buzz and excitement around your online store launch, you can organize a launch event, whether online or offline, to showcase your products and services and demonstrate how customers can use your website to purchase products online.
Step 12: Promote Your Store
With everything set, your online store is now ready to start receiving orders from customers. But remember that customers will only come to your online store if you actively promote it to your target audience. Even if you have the most beautiful website in the world, if people don’t know about it, you won’t make any money from it. Let’s discuss ways to market an online store in Uganda.
How to promote an online store in Uganda
1. Content Marketing
Create high-quality, valuable, and relevant content for your online store. This could include creating and publishing blog posts, infographics, videos, and other relevant content that aligns with your brand and industry. Content marketing helps to attract and engage potential customers.
2. Influencer Marketing
Identify popular social media influencers that align with your brand, and work with them so they can give your store the much-needed hype to drive sales. Working with popular social media influencers can help boost the visibility and credibility of your online store, as well as increase your sales.
3. Email Marketing
Email marketing is an important strategy for driving sales. Start collecting emails from day one and build an email list. Sending personalized and targeted email campaigns to potential and existing customers can increase brand awareness, drive sales, and retain existing customers.
4. Social Media Marketing
Promote your store on popular social media platforms such as Facebook, Twitter, TikTok, Instagram, Pinterest, YouTube, Telegram, and WhatsApp. Utilizing social media platforms to promote your online store can help increase brand awareness and drive sales. This would include creating and managing social media accounts, publishing regular content, engaging with your audience, and running paid advertising campaigns. For example, if you sell baby products, your promotion efforts should be concentrated on female-dominated groups such as Mama Tendo Foundation and other relevant forums about motherhood and parenting. While you can promote your online store on some of these forums and channels without paying, you will need to pay to leverage more channels like Google Ads and Facebook Ads.
5. Search Engine Optimization (SEO)
Optimize your online store’s content and structure so you can rank higher in search engine results pages (SERPs). Ranking higher in search engines like Google, Bing, and Yahoo Search can help increase your store’s visibility and drive more traffic to it. This would include researching and using relevant keywords, creating high-quality content, and building backlinks to your website.
6. Referral Marketing
Encourage existing customers to refer their friends and family to purchase from your online store. This will help increase the visibility of your store and drive sales. To execute this, you can offer incentives and rewards for successful referrals, making it easy for customers to share referral links.
7. Paid Advertising
Running paid advertising campaigns on platforms such as Facebook, Google, and Instagram can help increase visibility and drive traffic to your online store. This typically includes researching and targeting your ideal audience of potential customers, creating engaging visuals and ad copy, and regularly monitoring and adjusting your campaigns for maximum performance.
8. Affiliate Marketing
Partner with blog websites to promote your online store. This can help increase sales. Recruit affiliates, create affiliate marketing materials, and provide commissions or incentives to partners for successful sales.
9. Run Special Offers and Deals
Running special offers and deals is a great and effective way to promote your online store. Offer discounts or promotions on certain products to attract new customers and increase sales. Special offers can include limited-time discounts, bundle and combo deals, Buy one, get one free (BOGO) deals, free shipping/delivery, and loyalty rewards. These special deals and offers should be used strategically and not overused, as they can devalue the products and make customers less likely to buy at full price. Track the results of these promotional offers to see which ones are most effective and adjust your strategy accordingly.
10. Sales Literature
Sales literature such as flyers, business cards, and brochures are an effective way to promote an online store. Distribute these materials personally at trade shows, events, or even by email to potential customers. You can also leave them at local businesses or distribute them door-to-door in the local community.
11. Advertise on Mainstream Media
Advertising on mainstream media such as radio, T.V., newspapers, and billboards is another effective way to market your online store. These traditional forms of media can be expensive to advertise with but have a broad reach and can help to increase brand awareness and attract new customers to your store. For example, if you run a T.V. advert during primetime hours, your ad can reach millions of viewers.
Conclusion
Starting an online store in Uganda can be an excellent opportunity for businesses to expand their reach and increase revenue. The e-commerce industry in Uganda is fast growing. Therefore, it is crucial to take advantage of this opportunity, set up your online store, and start making money. Though the process of starting an online store in Uganda may seem challenging, with the proper knowledge and strategies, you can easily set up a successful store and make a lot of money. You should have a well-written business plan, choose the right developer to build your website, and effectively promote your store using the marketing and promotional strategies discussed in this guide. Use this step-by-step guide as a roadmap to navigate the process of starting an online store in Uganda and take your online business to the next level. You can also check out our guides on how to start an online business in Uganda and how to make money online in Uganda.
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