Ecommerce Platform

How Profitable Is An Ecommerce Platform? (Updated for 2024)

Pat Walls

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Updated: October 5th, 2024

How Profitable Is An Ecommerce Platform? (Updated for 2024)

So you want to start an ecommerce platform?

And the first question that came to your mind was, “well, are ecommerce platforms actually profitable?”

With a market size of $2.72T - there’s plenty of business to go around.

Especially considering:

You could start a ecommerce platform with as low as $20
Based on our data, ecommerce platforms generate an average of $2.43M per year
You could see gross margins as high as 75% with ecommerce platforms

There’s money to be made. Don’t worry.

But, I don't want to spoil it all. Below we’ll cover everything you need to know when it comes to the profitability of a ecommerce platform.

Let’s dive in!

Is an ecommerce platform profitable?

Yes, an ecommerce platform is generally a profitable business. However, you still need to consider several factors since these things always impact the overall outcome.

For instance, since average revenue is $2.43M per year with an estimated gross margin of 83%, you could expect to recover your investment within 10 months or even less.

But of course, it all comes down to how much you earn compared to the potential revenues of your ecommerce platform.

To determine whether your business is profitable, you should earn more than your expenses in the beginning months. However, while you're in your first month, it can be challenging to know what to expect.

Therefore, you should maintain a record of your monthly expenses and income to determine whether you're meeting your goals. By doing this step, you can see how your ecommerce platform is doing and if any changes or adjustments need to be made to enhance or maintain your efforts.

Is an ecommerce platform worth it?

If you’re wondering if a ecommerce platform is worth it, the answer is a big YES. With ecommerce platforms, you have the potential to earn $2.43M per year (this is based on data reported by real founders).

Further, you could have your initial investment back within months. Simply put, it’s a business worth a shot, especially if you have the resources and make the necessary efforts to achieve or surpass the target.

With a market size of $2.72T, it will be possible for you to build something that grows and turns into a flourishing business. As such, it’s the type of business you might want to consider starting.

Of course, you must learn and understand every aspect of running a ecommerce platform to ensure success. Still, as long as you have the initial investment and can endure a few months before your actual gains, this business could be worth it.

You might want to consider reading more specifics about successful ecommerce platforms case studies.

Examples Of Profitable Ecommerce Platforms

Here are a few examples of profitable ecommerce platforms, and a few more details about them:

1. StoreYa ($24M/year)

StoreYa was founded by Eyal Reich and his brother Yariv, along with Pasha Zaft, with the goal of creating a profitable business model in the e-commerce industry. They started by launching the first Facebook shop app, which gained traction and led them to develop on-site promotion apps. Recognizing the challenge of getting targeted traffic, they then created Traffic Booster, which leverages their expertise in PPC and technology to automate Google Ads using AI. StoreYa has since become a successful marketing and advertising platform, with over 200,000 online sellers and generating $700K MRR.

Is it profitable? Yes
How much money it makes: $24M/year
How much did it cost to start: $5K

How We Started A $700K/Month Business Getting Targeted Traffic For Online Sellers

StoreYa co-founders Eyal Reich and Yariv Dror, along with CTO Pasha Zaft, created a suite of marketing and advertising apps that include Traffic Booster, which has generated an average of $700,000 MRR and helped the business win a 2018 Google Acquisition Performance award, as well as becoming a PayPal exclusive advertising partner.

Read this case study

Read by 11,192 founders

2. Bagisto ($600K/year)

Saurav Pathak, the Chief Product Officer of Bagisto, came up with the idea for the open-source e-commerce platform after realizing there was a huge gap between demand and supply for platform-driven e-commerce solutions. With the goal of making it simple for developers to create their own online stores, Bagisto has generated over $1 million in revenue and has a user base of 200,000.

Is it profitable? Yes
How much money it makes: $600K/year
How much did it cost to start: $10K

How We Built A MillIon Dollar Ecommerce Platform [India]

Open-source e-commerce platform Bagisto has generated over $1 million in revenue in the past four years, with $350,000 annual recurring revenue for the past two years, has over 70,000 downloads, 5,000 Github stars, 5,000 community members globally, and over 150 contributors enhancing its features.

Read this case study

Read by 6,050 founders

3. CartFox.io ($18K/year)

Simon, the founder, started his eCommerce business with a 5K EUR investment inherited from his grandmother. After successfully creating several brands and generating over 150M+ EUR in revenue, he identified the need for a SaaS solution for SMS marketing and cart abandonment recovery in the competitive EU eCommerce market. This led to the birth of CartFox.io, which aims to become their flagship product within a year or two.

Is it profitable? Yes
How much money it makes: $18K/year
How much did it cost to start: $120K

How We Built A $1.5K/Month SMS Marketing SaaS With Just A Plain PHP Tech Stack

Slovenian eCommerce business owner turns internal solution into SaaS product CartFox, with over 150M EUR revenue generated through several brands, but still breaking even $1.5K/month with salaries included from CartFox.

Read this case study

Read by 2,061 founders

Learn more about starting an ecommerce platform:

Where to start?

-> How much does it cost to start an ecommerce platform?
-> Pros and cons of an ecommerce platform

Need inspiration?

-> Other ecommerce platform success stories
-> Marketing ideas for an ecommerce platform
-> Ecommerce platform slogans
-> Ecommerce platform names
-> Ecommerce platform Instagram bios

Other resources

-> Ecommerce platform tips

How much can you make with an ecommerce platform?

With a ecommerce platform, you can make an average of $2.43M revenue per year (based on data reported by real businesses).

You can start with an initial investment as low as $20. Then, with proper knowledge and sustained effort, you could have an ROI (return of investment) within 10 months.

How much does a ecommerce platform make a week?

Based on our data, average weekly revenue for a ecommerce platform ranges around $50.6K. As such, you could see monthly revenues of $202K.

To know if your ecommerce platform achieves the weekly profit target, you need to keep track of the total earnings you get per day. Afterward, you'll want to consider subtracting the expenses you have daily.

Learning your weekly profit can also show whether you're hitting your target goal for your ecommerce platform.

How much do ecommerce platforms owners make?

The income of an ecommerce platform owner can vary depending on various factors such as location, size, competition, and the owner's business skills.

But to give you some idea, the weekly revenue of an established ecommerce platform is about $50.6K. But this can be lower or higher depending on so many factors - it's almost impossible to say exactly.

While the potential for earning a good income as an ecommerce platform owner exists, success in this field requires a commitment to providing quality products and services and building a strong reputation within the community.

Ecommerce Platform Profit Margins

Generally speaking, an ecommerce platform can expect profit margin of around 83%. Profit margins refer to the percentage of revenue that remains after deducting all expenses associated with running a business. In the case of an ecommerce platform, profit margins can vary depending on various factors, such as the type and quality of products sold, the size of the store, and the level of competition in the area.

However, these figures can vary depending on the pricing strategy, inventory management, and overall efficiency of the business. To maintain healthy profit margins, ecommerce platform owners must focus on managing costs, negotiating favorable supplier terms, and providing high-quality products and services to attract and retain customers. By doing so, ecommerce platform owners can ensure long-term sustainability and profitability for their business.

Ecommerce platform owner salary

The salary of an ecommerce platform owner is an unpredictable figure. It's significantly influenced by numerous factors, including the store's location, its size, and the degree of competition. An owner of a well-established ecommerce platform, in a prime position, might see an average weekly salary around the ballpark of $42K.

But it's worth noting, such numbers aren't always consistent. The earnings can vary wildly, potentially swinging by as much as 80% either way.

Achieving consistent success and maintaining a reliable income stream in this industry requires a deep commitment. It's imperative to offer high-quality products, deliver impeccable customer service, and nurture a trusted bond with the community you serve.

Conclusion

In a nutshell, based on many of our examples, a ecommerce platform may be a promising business to start - but the success of your ecommerce platform mostly depends on your effort and your approach.

If you focus on these, you'll have a much higher chance of a profitable ecommerce platform.

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Starting An Ecommerce Platform: Everything You Need To Know

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