How to Start an Ebook Store

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Our guide on starting an ebook store covers all the essential information to help you decide if this business is a good match for you. Learn about the day-to-day activities of an ebook store owner, the typical target market, growth potential, startup costs, legal considerations, and more!

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Start an ebook store by following these 9 steps:

You have found the perfect business idea, and now you are ready to take the next step. There is more to starting a business than just registering it with the state. We have put together this simple step guide to starting your ebook store. These steps will ensure that your new business is well planned out, registered properly and legally compliant.

STEP 1: Plan your Business

A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:

  • What are the initial costs?
  • Who is your target market?
  • How long it will take you to break even?
  • What will you name your business?

Luckily we have done a lot of this research for you. Skip on ahead to the Business Overview for more detailed answers to all your questions.

Choosing the right name is very important. We recommend checking if the business name you choose is available as a web domain and securing it early so no one else can take it.

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STEP 2: Form a legal entity

Establishing a legal business entity such as an LLC prevents you from being personally liable if your ebook store is sued. Consider using a registered agent service to help protect your privacy and stay compliant.

STEP 3: Register for taxes

You will need to register for a variety of state and federal taxes before you can open for business.

STEP 4: Open a business bank account

Using dedicated business banking and credit accounts is essential for personal asset protection.

When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.

STEP 5: Set up business accounting

Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.

STEP 6: Obtain necessary permits and licenses

Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.

STEP 7: Get Business Insurance

Insurance is highly recommended for all business owners. If you hire employees, workers compensation insurance may be a legal requirement in your state.

STEP 8: Define your brand.

Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.

STEP 9: Establish your Web Presence

A business website allows customers to learn more about your company and the products or services you offer. You can also use social media to attract new clients or customers.

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Select your state below for an in-depth guide on completing each of these steps in your home state.

Business Overview

Just as the digital camera has revolutionized the photography industry, the tablet and ebook reader have transformed bookselling. Ebooks today command a major section of the publishing industry. In the United States alone, 487 million ebooks are sold each year for a revenue of $3.1 billion.

Ebook businesses sell ebooks to readers. With low startup costs and a huge market, this is a promising business opportunity that many have taken advantage of.

Who is this business right for?

Anyone who enjoys writing may be well-suited for running an ebook business. This business model requires a lot of writing, but business owners are free to write on most any topic. There are ebooks on all manner of subjects.

What happens during a typical day at an ebook store?

Most of the time spent running an ebook store business is devoted to writing ebooks, which includes researching, actually writing and editing books. When not writing ebooks, business owners may spend time working with editors and cover designers, and marketing their business.

What is the target market?

Ebooks appeal to almost everyone, including people of both genders and of all ages. The genre that’s chosen will determine the particular demographic that a business targets, but there are genres for every interest and every person.

How does an ebook store make money?

An ebook store makes money by selling copies of ebooks. Ebooks are usually sold through an existing platform, which may be a business owner’s website, Amazon, Barnes and Noble, iTunes or another platform.

What is the growth potential for an ebook store?

An ebook store business is an easy business to scale. With just a click, business owners can have an ebook available in multiple countries. How many books they’re able to offer depends on how quickly they can write. Some business owners have just one or two books available, while others have many titles. For example, Hugh Howey and Amanda Hocking both have over 30 books for sale.

What are some skills and experiences that will help you build a successful ebook store?

In order to run an ebook store business, business owners must know how to write a book and have the technical expertise to publish their work as an ebook.

Business owners who don’t have writing experience can learn by reading grammar manuals and taking one or more writing classes. The Elements of Style is a classic grammar book. For a writing class, business owners can check the offerings at their local community college or enroll in an online course. Stanford and Gotham Writers both have online writing courses.

To publish an ebook, business owners will have to convert their book to a .mobi (for Amazon) or .epub (for other platforms) format. Most ebook platforms have guides on how to publish through their platform. For instance, AmazonApple and Barnes and Noble all have guides for their respective platforms.

What are the costs involved in opening an ebook store?

The startup costs for opening an ebook store business are minimal because business owners usually write their books themselves. The Write Life interviewed three authors on the expenses they did pay when publishing their first ebook. The authors paid for:

  • professional editing ($60 to $1,500)
  • cover design ($0 to $240)
  • formatting ($0 to $299)

Business owners who have limited capital can do each of these themselves or ask a talented friend to assist them. Many people are willing to help someone they know get a book published.

Some ebook store businesses also choose to set up a website, which can be done inexpensively (or free).

Where can I find a business mentor?

One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.

Having a support network in place to turn to during tough times is a major factor of success for new business owners.

What are some insider tips for jump starting an ebook store?

The cover design of an ebook is often the only part of the book that customers actually see before they purchase it. Therefore, the cover must capture potential reader’s attention and show them that the book is professionally done.

To maximize ongoing sales, business owners frequently write series of books. In fiction, the first book in a series might be offered for free. Customers who like the first book will usually pay for the sequels. In nonfiction, business owners frequently write several books on similar topics to reduce the research they need to do and maximize their writing output.

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Growing Your Business

How to promote & market an ebook store

One of the most popular and effective ebook marketing strategies is specifically for Amazon, which is the largest seller of ebooks. Amazon offers a program that lets business owners discount their books or offer the books for free. The discount lasts for a limited time, but downloads often increase during this time. The increase in downloads can help a book rank in Amazon’s searches and pages, which can lead to more sales after the promotional period.

Recommended: Get started with local advertising for your business with a $300 credit from Yelp.

How to keep customers coming back

An ebook store business can keep customers coming back and purchasing new titles by running an email newsletter. A newsletter gives business owners a way to connect with their readers on another level, and it provides an opportunity to share when new books are being released.

How and when to build a team

Most ebook store businesses are run by just one person. A few business owners who are highly successful may grow their business by hiring writers to produce books for them. Only a small number of ebook store business owners take this approach, though.

Legal Considerations

State & Local Business Licensing Requirements

Certain state permits and licenses may be needed to operate a ebook business. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.

Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses.

For information about local licenses and permits:

Maintain Personal Asset Protection

Don’t think that just forming an LLC, or any other type of business, will save your personal assets in case of a lawsuit or other matter by itself.

When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your LLC is sued. In business law, this is referred to as piercing your corporate veil.

Two of the simplest steps that will protect your business, and yourself, are to:

Open a business bank account

  • This separates your personal assets from your company's assets, which is necessary for personal asset protection.
  • It also makes accounting and tax filing easier.

Get a business credit card

  • This helps you separate personal and business expenses by putting your business' expenses all in one place.
  • It also builds your company's credit history, which can be useful to raise money and investment later on.
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To learn more about maintaining your LLC's corporate veil, read our guide and protect your personal assets.

Earning Potential

How much can you charge customers?

Most ebooks sell for anywhere from $0.99 to $9.99. The most popular price range is between $2.99 and $9.99, for publishing platforms frequently offer higher royalties at these price points. (This discounts ebooks that are given away for free to grow readership).

What are the ongoing expenses for an ebook store?

The ongoing expenses for an ebook store business are identical to the startup costs. They include web hosting fees, and editing, cover design and formatting costs for new books. Continuing to sell already published books usually costs nothing.

How much profit can an ebook store make?

An ebook store business can be a highly profitable venture, but success is far from guaranteed. One survey found that the average income of self-published authors was $10,000, and half of self-published authors earned less than $500 in a year. Some businesses, however, earn much more. Hugh Howey earns six-figure sums in a month, and Amanda Hocking has over $2.5 million in sales. (These sums aren’t only from ebook sales, but ebooks account for a large portion of these figures.)

How can you make your business more profitable?

An ebook store business can increase revenue by offering print books through a print-on-demand service and audio books. Once a book a written, it’s easy to convert it from an ebook to either of these other formats.

Next Steps

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