Maximize Your Profits: Save $30K in Taxes

If you’re an aspiring e-commerce seller, the thought of scaling to six or even seven figures might seem like a pipe dream. Until you doola it.

Now you’d ask:

How to start and scale an e-commerce business?

Whether you’re launching a dropshipping store, selling private-label products, or building a brand from scratch, the secret to going from $0 to $100K lies in having the right mindset, a solid business structure, and a growth-driven strategy.

But starting and scaling an e-commerce business isn’t just about finding winning products or running ads; it also requires staying compliant and financially organized.

That’s where doola’s e-commerce formation and compliance come in.

From LLC formation and tax efficiency strategies to bookkeeping and financial compliance, doola helps you build a legally sound and scalable business, so you can focus on growing sales without the compliance headaches.

In today’s e-commerce playbook, we will answer: how to start and scale an e-commerce business?

We will also break down the key takeaways from AC Hampton’s webinar at Shopify HQ, covering practical steps for starting and scaling an e-commerce business while keeping your operations tax-efficient and legally compliant.

Meet AC Hampton: The $0 to $100K Scaling Expert

Before we cover the step-by-step strategies on how to start and scale an e-commerce business, let’s introduce the expert sharing his insights.

AC Hampton is a multi-million-dollar e-commerce entrepreneur, mentor, and educator. Known for scaling online stores from scratch, he has generated over $10 million in revenue and helped thousands of entrepreneurs build profitable, sustainable businesses.

In the Shopify HQ webinar, AC reveals his proven strategies for finding winning products, scaling ad campaigns, and building a long-term e-commerce brand. All while staying tax-efficient and legally compliant.

The Mindset for Success in E-Commerce

Success in e-commerce requires the right mindset, discipline, and long-term vision. Whether you’re aiming to reach your first $100K or scale to seven figures, knowing how to start and scale an e-commerce business starts with a goal-driven strategy and unwavering consistency.

That, precisely, is the time-tested formula for sustainable growth.

Understanding Your “Why”

Success in e-commerce starts with a clear purpose. Why do you want to start an online business? Is it financial freedom, flexibility, or creating generational wealth?

Defining your “why” will help you push through obstacles and stay committed even when things get tough.

AC Hampton, the mastermind behind today’s insights, credits his multi-million-dollar e-commerce success to having a clear and compelling “why.”

He grew up in Kansas City, Missouri, raised by a single mom, and hustled through various jobs before finding his breakthrough in dropshipping. What kept him going? A vision of financial independence and the desire to build a lasting legacy.

Setting SMART Goals

While having a vision is important, execution is everything. The best way to stay on track when learning how to start and scale an e-commerce business is by setting SMART goals:

• Specific: Define exactly what you want to achieve (e.g., launch your Shopify store in 30 days).

• Measurable: Track performance through sales, website traffic, or ad conversions.

• Achievable: Set realistic targets to avoid burnout or frustration.

• Relevant: Ensure your goals align with your overall business vision.

• Time-bound: Set deadlines to stay accountable and measure progress.

Here’s a perfect example of a SMART Goal:

“Generate $20K in revenue from Facebook Ads by the end of Q2.”

The Power of Consistency

No matter how strong your strategy is, e-commerce success requires resilience and consistency.

And the following guiding principles:

• You won’t become a six-figure seller overnight.

• The most successful entrepreneurs show up every day, learn from failures, and refine their strategies.

Speaking of consistency, AC Hampton draws inspiration from Kobe Bryant’s legendary work ethic: the unwavering commitment to daily improvement. As you learn how to start and scale an e-commerce business, apply the same consistency and dedication by continuously testing, optimizing, and scaling.

With the right mindset and goals in place, it’s time to move on to the strategic steps for building and scaling a profitable e-commerce business.

Up next, we’ll cover how to start and scale an e-commerce business through winning products, high-converting Shopify stores, and a solid customer acquisition strategy.

How to Start and Scale an E-Commerce Business: Step-by-Step Guide

Launching and growing a profitable e-commerce business takes a clear roadmap, strategic execution, and consistent effort. Let’s understand how to start and scale an e-commerce business following the right steps and build you a sustainable and scalable online store.

Step 1: Choose the Right Business Model

Your business model defines how you source, sell, and profit; so getting this part right is essential when figuring out how to start and scale an e-commerce business. Here are the three most popular e-commerce models to consider:

• Dropshipping: A low-cost, low-risk model where you sell products without holding inventory. The supplier ships directly to the customer.

• Private Labeling: Customize and brand products to build a recognizable business. It offers higher profit margins but requires more upfront investment.

• Print on Demand: Create and sell custom products (apparel, accessories, etc.) without upfront inventory.

Choosing the right model depends on your budget, experience, and risk tolerance; so pick the one that aligns with your goals.

Step 2: Find Winning Products

Not all products sell well. To succeed, find items that solve problems, tap into trends, or offer unique benefits. Use these strategies to find profitable, in-demand products:

• Market research: Spot trending products with tools like Google Trends, TikTok searches, or Amazon’s Movers & Shakers.

• Competitive analysis: Scope out what’s working for competitors, identify gaps in their offerings and establish unique differentiators for your product.

• Test before scaling: Run small ad campaigns on Meta (Facebook/Instagram) or TikTok to validate demand before investing heavily.

The sweet spot? Products with rising demand but low market saturation; they’re your gateway to higher profit margins.

Step 3: Build Your Online Store

Your storefront is your digital real estate.

Use platforms like Shopify, BigCommerce, or Wix to create a professional and user-friendly store.

Here’s how to optimize it for conversions:

• Seamless user experience: Ensure fast loading speed, clear navigation with easy-to-find products, and mobile optimization.

• Compelling product descriptions: Don’t just list features; highlight product benefits. Use persuasive language to boost conversions.

• Payment gateways: Ensure smooth transactions and offer multiple payment options (credit cards, PayPal, BNPL services).

As you learn how to start and scale an e-commerce business, remember, a clean, intuitive store with compelling product pages and easy checkout will maximize your conversion rates.

Step 4: Marketing and Customer Acquisition

Once your store is live, it’s time to drive traffic and make sales. Implement these proven techniques to get traction from your target audience:

• Paid Ads: Use Meta (Facebook & Instagram) and Google Ads to reach targeted buyers. Test different creatives, audiences, and offers to maximize ROI.

• Organic Growth: Create SEO-optimized blog content and leverage social media platforms like TikTok, YouTube, and Pinterest to boost visibility.

• Influencer Collaborations: Partner with micro-influencers in your niche to build trust and credibility.

And ultimately, consistency is key. Regular marketing efforts will help you build momentum and scale your revenue over time.

Step 5: Scaling the Business

Once you’re seeing consistent sales, it’s time to reinvest profits and scale your operations for long-term growth:

• Increase ad spend: Double down on high-performing campaigns and reinvest profits into expanding your reach.

• Expand product offerings: Based on demand, add new, complementary products to increase average order value (AOV).

• Third-party logistics (3PL): Use 3PL to handle warehousing and shipping. This frees up your time to focus on growth.

• Optimize conversion rates: Run A/B tests on product pages and landing pages. Use retargeting ads to re-engage abandoned carts.

Now that you know how to start and scale an e-commerce business, it’s time to protect your profits with the right business structure.

Up next, we’ll cover how to maximize tax efficiency, reduce liability, and stay compliant with doola’s expert guidance.

Business Structure for Maximum Tax Efficiency

When learning how to start and scale an e-commerce business, choosing the right legal structure is just as important as finding winning products or running effective ads.

A proper business structure impacts your liability, tax obligations, and overall profitability—helping you keep more of your hard-earned revenue.

LLC vs. C Corp vs. S Corp: What’s Best for You?

The legal structure you choose will directly influence your tax liabilities, personal protection, and growth potential. Here’s how the most common options compare:

• LLC: Ideal for small business owners seeking liability protection and tax flexibility. Profits pass through to the owner’s personal tax return, avoiding double taxation.

• C Corp: Best for startups aiming to raise venture capital. Profits are taxed at the corporate level, and dividends are taxed again on personal returns (double taxation).

• S Corp Election: Reduces self-employment taxes by allowing business owners to split income between salary and distributions. Thus making it highly tax-efficient for e-commerce sellers earning over $75K annually.

📌 doola Tip:

Many e-commerce entrepreneurs opt for an LLC with an S Corp election to maximize tax savings while maintaining personal liability protection.

Tax-Saving Strategies for E-Commerce Entrepreneurs

Once your business structure is in place, the next step in understanding how to start and scale an e-commerce business is optimizing for tax efficiency.

Here are five strategies to reduce your tax burden:

S Corp Election:

Lowers self-employment taxes, essential for business owners earning $75K+ in net income. By splitting income between salary and distributions, you reduce tax liabilities.

Home Office Deduction:

If you run your e-commerce business from home, you can deduct rent, utilities, and internet expenses.

Education & Training Deduction:

Write off expenses for courses, webinars, and mentorship programs that improve your business skills.

Startup Cost Deduction:

Deduct up to $5,000 in formation, consulting, and marketing expenses in your first year.

Technology & Software Deductions:

Expenses for laptops, Shopify subscriptions, email marketing tools, and business software are tax-deductible.

Make sure you track and categorize all business expenses throughout the year to maximize deductions and reduce taxable income.

Ready to scale your e-commerce business the smart way? Let doola help you stay legally compliant and tax-efficient while you focus on growing your brand.

Book a free consultation with us today!

Essential Tools for E-Commerce Success

When understanding how to start and scale an e-commerce business, having the right tools is just as important as choosing winning products or running effective marketing campaigns.

The right tech stack helps you streamline operations, track performance, and optimize growth— giving you a competitive edge. Here’s your go-to list:

1. Shopify: The go-to platform for e-commerce sellers, Shopify makes it easy to build and manage your online store, handle payment processing, and streamline order fulfillment.

2. doola: Your one-stop solution for business formation, bookkeeping, and tax compliance. With doola by your side, you can focus on growing your store while staying legally compliant and tax-efficient.

3. Google Analytics: This powerful tool helps you track customer behavior, website traffic, and sales performance—providing valuable insights to optimize your store’s conversion rates.

4. Meta & Google Ads Manager: Essential for scaling paid traffic campaigns, these platforms help you target the right audience, track ad performance, and maximize ROI.

Now that you have the tools to start and scale an e-commerce business, the next step is ensuring your business remains compliant and financially organized. Up next, we’ll cover bookkeeping best practices and legal compliance tips to help you stay audit-ready and maximize profitability.

Compliance and Bookkeeping Best Practices

Sloppy compliance or messy financial records can lead to costly fines, tax issues, or worse—legal trouble. So when it comes to starting and scaling an e-commerce business, staying legally compliant and keeping your books in order is non-negotiable.

Here’s how you can keep your business compliant and financially organized from the beginning.

Staying Legally Compliant

Compliance isn’t just about avoiding fines; it’s about protecting your business and keeping it in good standing with the IRS and state authorities. Here are the key steps you need to follow:

1. Use a Bookkeeping Solution

Accurate financial records are the backbone of a healthy e-commerce business. Use tools like doola Bookkeeping to automate your expense tracking, reporting, and tax preparation. This ultimately saves you time and reduces human error.

2. Set Up a Business Bank Account

Keep your personal and business finances separate. Why? Because mixing them is a recipe for tax nightmares and makes your books harder to manage.

3. File the BOI Report

Disclaimer: Please note that as of March 31, 2025, Beneficial Ownership Information (BOI) requirements are no longer in effect. This change may impact previously published content on this blog related to BOI compliance. Always consult current regulations or a legal professional for the most up-to-date information.

New in 2024, business owners must report Beneficial Ownership Information (BOI) to the Financial Crimes Enforcement Network (FinCEN) within 30 days of formation. This report identifies the individuals who own or control your business. And skipping it could mean hefty penalties.

4. Stay on Top of State & Federal Filings

Stay ahead of filing deadlines by submitting your annual reports, EIN filings, and state and federal tax documents on time—because missing them could mean hefty fines or even business dissolution.

How doola E-Commerce Formation and Compliance Services Can Help

If you’re still thinking how to start and scale an e-commerce business, doola has you covered— handling all the formation, compliance, and bookkeeping details so you can focus on growing your store without sweating over tax forms.

doola is for do’ers and here’s what we bring to the table:

✔️ Hassle-Free Business Formation

Whether you’re setting up an LLC, C Corp, or S Corp, we’ll handle the end-to-end formation process—fast, accurately, and compliant with all regulations.

We’ll register your business in any state, provide you with a registered agent, and ensure you’re legally compliant from day one

✔️ EIN and Tax ID Registration

doola helps you skip the IRS hassle. Our experts secure your EIN (Employer Identification Number) for you, so you can open a business bank account, file taxes, and apply for your reseller certificate without the paperwork headache.

✔️ Sales Tax Registration & Compliance

More often than not, sales tax can be a maze of state-specific rules; but doola makes it simple. We’ll register your business for sales tax permits in every state you operate and manage ongoing compliance and filings, so you stay stress-free.

$100K Is Just the Beginning: Scale Your E-Commerce Empire With doola

We’ve spoken with thousands of e-commerce CEOs over the years, and we’ve never heard anyone say:

“I’ve finally hit $100K in sales! Time to hang up my hat and retire.”

Because the $100K mark is a great milestone; but your business has the potential to grow beyond.

But scaling an e-commerce business beyond this point requires more than just a great product. It demands strategic reinvestment, financial optimization, and airtight compliance.

By following this playbook on how to start and scale an e-commerce business, you’ll have the tools and strategies to launch, grow, and streamline your store. Whether you’re just starting or looking to scale to 7-figures, implementing these insights will position your business for long-term growth.

If you’re serious about your $100K goal and want to learn more about how to start and scale an e-commerce business, now is the time!

Book a free consultation and build your e-commerce empire with doola!