{"id":18714,"date":"2022-11-28T12:19:05","date_gmt":"2022-11-28T11:19:05","guid":{"rendered":"https:\/\/trilogi.com\/blog\/your-ecommerce-tco-what-is-it-and-how-is-it-calculated-2\/"},"modified":"2026-10-23T18:29:20","modified_gmt":"2026-10-23T16:29:20","slug":"your-ecommerce-tco-what-is-it-and-how-is-it-calculated-2","status":"publish","type":"post","link":"https:\/\/trilogi.com\/blog\/en\/your-ecommerce-tco-what-is-it-and-how-is-it-calculated-2\/","title":{"rendered":"Your eCommerce TCO: what is it and how is it calculated?"},"content":{"rendered":"\n

With the digital revolution of recent years, many companies have considered creating an eCommerce store<\/a> to sell their products. It is an important strategic decision for any organization. One of the main challenges is knowing how much it costs to run an eCommerce business, given the technological and operational needs you may have.<\/p>\n\n\n\n

This is where the concept of Total Cost of Ownership (TCO) <\/strong>comes in. It is the sum of the initial cost of the eCommerce platform (license, plug-ins, development\u2026) and operating costs over the first 3\u20135 years. It is an important analysis, since 43% of companies report that costs are higher or much higher than calculated in the TCO<\/strong> (source: Forrester).<\/p>\n\n\n\n

Calculating the TCO for different platforms will help you decide before launching your eCommerce, stay within budget and minimize surprises down the road.<\/p>\n\n\n\n

What should you consider when calculating TCO?<\/h2>\n\n\n\n

When we talk about the initial costs of an eCommerce store, we mean the license price, hosting, extensions (add-ons), third-party applications (plug-ins), feature development, graphic design and ongoing maintenance.<\/p>\n\n\n\n

You also need to factor in opportunity cost, which plays a key role in TCO analysis. Opportunity cost is the value of the potential loss from choosing one platform over another. <\/strong>For example, a platform may be cheaper upfront but suffer frequent outages or issues, resulting in lost revenue and extra maintenance costs. Or a platform may fit your current requirements but be unable to scale in the future as your business grows.<\/p>\n\n\n\n

How to calculate TCO<\/h2>\n\n\n\n

The most basic formula is: <\/p>\n\n\n\n

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TCO = Total costs \/ Annual sales<\/strong><\/p>\n<\/blockquote>\n\n\n\n

It is recommended to run this calculation over 3 years to know more precisely whether you are making the right decision. <\/p>\n\n\n\n

As we mentioned, the hardest part may be knowing how much running your eCommerce really costs, since some expenses are hidden. It is also important to know that an online store does not cost the same in its first year as in its second. <\/strong>You can average the first three years to get an accurate estimate.<\/p>\n\n\n\n

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Source: Forrester<\/figcaption><\/figure>\n\n\n\n

You can ask yourself a few questions that can help you estimate the total cost of your eCommerce:<\/p>\n\n\n\n