Technology is drastically changing the business world as e-commerce offers endless opportunities for entrepreneurs with quick, easy and inexpensive ways to create an online business. However, a well thought out business plan is still crucial to have a lasting and profitable company.
This article, How to create an online store: 10 Steps to write your business plan, covers everything you need to plan, strategize and ultimately start a successful e-commerce business.
What’s in an e-commerce business plan?
A business plan is vital to succeed in this lucrative market. Even if you aren’t planning to share it with other professionals, it’ll force you to ask yourself the right questions to help you cut your losses and stay focused on your goals.
Here are the important aspects of a business plan:
1. Executive Summary – This may be the toughest part of writing a business plan, you may want to outline it and then finalize it after you’re finished with everything else. It should include your company’s objectives, mission and keys to success.
2. Company Summary – Here is where you’ll give share important details about your company. Make sure to include an overview of all the requirements to start your business as well as goals, target demographic and competitive advantages.
3. Products – This is where it starts to get fun. Outline all of your products, your inventory and packaging. You’ll also want to start thinking long term: What products will I add to my inventory? Am I manufacturing my products or buying them wholesale? What brands will I sell? Take a look at my blog post on products to sell online.
4. Market Analysis – You should be an expert in your industry before starting your online store. Gain an in-depth understanding of the current market and your competition. Take a look at Google Trends to know if the demand for your products fluctuates throughout the year(s). Take a look at the demand for “cashmere scarf” in 2013 for example.
5. Strategy and Implementation – Think long and hard about this since you’ll rely heavily on this part of your business plan! You need detailed strategies and forecasts for sales, customer service and customer acquisition. Include milestones to make sure you’re always on track.
6. Marketing Strategy – This is where you’ll set yourself apart from competitors. You should have a clear vision for your branding and how you’ll communicate with customers. It’s important to keep your mission in mind when developing your brand and how it will attract your target demographic. Some things to think about: a blog, social media, advertising and SEO.
7. Web Plan – Here’s where you might need to do some research, but that’s what the PrestaShop blog is here for! Consider all the development requirements for your site by drawing wire frames of what you want your ideal e-commerce site to look like. Use an e-commerce solution that gives you the flexibility and features you’ll need. With PrestaShop, you’ll be able to create and manage your online shop for FREE and unlike competing solutions, you’ll never give up a percentage of your sales or pay a hefty monthly fee. Also, check out my recent blog post on the top e-commerce design trends for your online store.
8. Management Summary – Outline all the employees you’ll need as well as their responsibilities. Map out how much each employee will cost you and what value they will add to your company. Think about how you’ll find qualified employees and how they can grow within your company.
9. Financial Plan – This entails a lot of work but it’s a pivotal part of your business plan. You should have at least the following: budget planning, break-even analysis, projected profit and loss, projected cash flow and funding requirements. I know, that’s a lot of math – this article on Practical E-commerce will help!
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10. Exit Plan – How you plan to exit your business is just as important as how you start. Think long-term plans: Are you going to sell your company to an investor? Do you have a 4 year timeline for this project? This will get your business off the ground and help you cut your losses before you even get started.
E-commerce business plan resources
These articles will help you out:
- Free course on how to build a start up on Udacity.com instructed by Steve Blank, a Silicon Valley entrepreneur.
- Free business plan guide and template includes all the details you’ll want to think about before starting your e-business.
- Feel like you can’t finish? Get motivated with 99u.com Elizabeth Grace Sanders’ inspiring article.
You’ve got everything you need to get started. Facing any challenges? Feel free to comment below and exchange best practices and advice!