This blog is created to help you determine if your e-commerce business idea is feasible. To identify questions and problems you will face, in converting your idea into reality, and to prepare for starting your e-commerce business.
We feature all the essential aspects you must consider, before you start your e-Commerce business. This will allow you to predict problems, before they happen, and keep you from losing your shirt on dog business ideas.
What should you include in your e-commerce business plan?
Here are the 10 sections that you should include in your business plan:
- Executive Summary: The first section is your executive summary which is essentially the introduction to your business plan.
- Company Analysis: Then the next section is your company analysis which gives a little more background.
- Industry Analysis: Next up is your industry analysis when you talk about your market and trends.
- Customer Analysis: The fourth section of your business plan is your customer analysis where you go more in-depth about your target market.
- Competitive Analysis: The fifth section is your competitive analysis where you provide an analysis of your competition including what differentiates you from your competitors.
- Marketing Plan: The sixth section is your marketing plan where you lay out your marketing strategy.
- Operations Plan: The seventh section of your business plan is your operations plan where you explain how you actually run or will run your business.
- Management Team: The next section of the management team is where you provide bios of your team.
- Financial Plan: The ninth section is your financial plan in which you give financial forecasts.
- Appendix: Finally, the tenth and last section of your business plan is your appendix where you provide any additional supporting information.
5 Key Factors To Develop Your E-Commerce Business Plan
It may feel very difficult trying to think about how to approach your business plan. This is the five different elements if you are sitting down to trying to plan exactly what you want:
Number one what you need to think about is the industry. If you’re starting an e-commerce business you need to think about what type of industry do i want to get into. For example, you may want to get into retail, fashion or selling toys. Research that industry. What you need to do is think about “How big is that industry?” and “How quickly it’s growing?”.
There are certain things that you can do to try and get this information. For example, searching online to see how big the industry is. Is it growing? What are the key trends within there? That will give you an idea of how many potential customers there are and how big the industry is.
2- Product or Service
The second thing we want to talk to you about is your product or your service offering. Thinking about what you are trying to sell and how you’re going to sell it.
If you’re going to sell a product online, then you need to think about creating a prototype as quickly as possible and getting it out there into the market. That is kind of the same thing as well if you’re trying to offer a service, a coaching course or something.
The reason why you want to create a prototype is because you want to try and refine it and as much as you can before it goes to the finalized product.
The third thing you want to look at is your competition. You want to try and understand who’s currently in the market today, who are the small and big players. In a market when it’s very competitive there is a lot of competition. You want to have a look at what they’re offering and how they’re offering it. This will give you an insight and as to how to approach it.
What you need to be careful of in this element though is to not copy. Make sure that you’re looking at what’s existing out there but you’re also differentiating yourself. So, think about what it is that you can offer that other people aren’t offering already or what it is that someone else is offering that you can change a little bit or add value to make it even better.
Sometimes there may not be any competition. So, within a market you have different phases and different stages. If what you’re launching is very good then it is likely that people will want to enter the market.
The fourth thing we want to talk about is your customers and your consumers. Your customer might not be equal to your consumer and you need to think about “Do the people who buy it use it?”
Another question you want to ask yourself is trying to understand exactly who they are and where they hang out. To define your customers, you need to think about:
- Who are they?
- How to split that out into a profile?
- What gender are they?
- What income do they have?
- Where do they locate?
- What brands do they like?
- What specific things do they like to do?
- What hobbies do they like to do?
Try to think about it as a bit of a simple profile of one person and you need to have a couple of those to try and understand exactly who your target audience is. A lot of people talk about target audiences and it may be quite difficult to target an audience when you don’t know who they are.
Also, have a think about where they are hanging out. Obviously in a well-precovered way if they are going to certain events or conferences. Have a think about how you can specifically target them. If you are selling a product online, it’s best to kind of use online methods to have the global reach that you want.
You also want to think about very specifically the geographical locations of where your customers are. And do you really want to target the whole world at the beginning or do you want to target specific markets like the US or the UK market.
This is very important for online sales especially if you have a product because you need to think about the cost of shipping and also the logistics behind that.
Finally, the fifth thing we want to talk about is your suppliers. When you refine your product and when you’re working with your suppliers to get your product in place, you need to think about if the supplier should be local or international.
If you’re working with a local supplier and (it’s probably best if you start off that way) this means that the supplier and your conversation and with them and your working relationship with them will be a lot quicker. Even though it may cost a bit more if you’re developing your own product or if you have a product already existing and you’re enhancing it.
The reason why you should choose local suppliers at the beginning if you’re starting out is obviously because of the time that we mentioned earlier. If you think about it from a timing perspective and you choose a supplier in China for example, and you live in the UK then you will have a mismatch.
That’s because if you think about it, the products that it takes to ship from China to the UK at best may be the quickest of the week. However if you have a local supplier which is within your own country then the shipping may take a day. So, that’s kind of five days or four days there you’re already delaying your product from one end to another.
If you think about it from a longevity perspective and you want to go back and forth with your supplier that time is crucial. Something that may take you a month to develop and you’re working with offshore suppliers that could take you months to develop.
Thinking about the kind of the postage and the delivery is one key element that will probably determine your supplier to be local at first.
The other thing you need to think about is the cost. If you are also looking at trying to put your own packaging onto something, then think about how that could work. There are suppliers nowadays that allow integration. So, if you send them your personalized packaging, then they can put stuff in there for you.
There are also suppliers which do the whole end-to-end for you. For example, if you are looking at print on demand businesses then that would be something that. Certain businesses would do the end-to-end. So, once they receive the order they would make the products. They would also pack it and then ship it and deliver it to your customer.
Writing a comprehensive business plan is essential to evaluate the viability of your business idea. When you record what you want to achieve, you are more likely to turn your vision into reality. Take time to find out what makes your products different, and be mindful of how you will find customers.
When you’re ready to create your eCommerce store, turn to Shopiroller’s eCommerce platform. Contact us to learn more.