E-commerce business plan: the stamp of your e-commerce success?

Are you planning to open your own e-commerce business? And do you want to make your e-commerce business plan to start on a good foundation?

Appvizer refreshes your memory and tells you all about e-commerce business plan starting from its usefulness to guiding you in making your business plan!

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Definition of a business plan: what is a business plan in a nutshell?

A business plan is a concise document that will allow you to present the pros and cons of your project in a simple and effective way so that you can clarify your business idea. Your e-commerce business plan will allow you to answer the following questions:

• Is my project feasible? Will it be profitable?
• What activity will I perform precisely? What is my expected turnover?
• What types of products will I sell on my e-commerce platform?
• What strategy will I use? In what niche will I position myself?
• Who are my competitors? What factors will differentiate me from them?
• How will I distribute my products or offer my services? Through which channel?
• What will be the timing of putting my products on sale?
• Will I work alone or do I need to hire other employees?
• What is the total amount of my investment?
• How will I finance these investments?

The business plan is a real tool for clarifying ideas and structuring the project. It should never be overlooked.

A business plan is a reference document whose goal is to present your plan to create an e-commerce business. It explains, in the most pedagogical way possible, the economic model of your e-commerce, the type of product proposed, your medium- and long-term strategy, and your sources of financing.Your business plan must convince an outside observer of the feasibility of your project, the adequacy of your skills.

Why is it necessary to make an e-commerce business plan?

The business plan has mainly three main objectives. It allows you to:

• Understand whether your e-commerce project is feasible.Your business plan will allow you to determine the relevance of your project from a strategic and financial point of view.Thanks to the business plan you can plan your costs and actions.
• Convince business or financial partners of the quality of your project.To be credible with external partners, you must present them with a feasible project, with a financial plan that confirms its profitability with concrete evidence.
• Serve as a guide during project implementation: for the entrepreneur, as for his team, the business plan serves as a reference point throughout implementation.

Depending on your objective, the interlocutor will therefore not be the same, so your business plan must adapt to the interlocutor and highlight the elements that may interest him/her.For example, if your objective is to sell the company you will put the light on certain elements such as receipts and the market if, on the other hand, you want a bank loan you will have to focus more on the financial plan. For this you need to determine what are the brakes and decision factors of your interlocutor.

How long should an e-commerce business plan be?

The business plan is a document that follows several norms and standards. However, in practice, no single page number prevails. In its form, a business plan should be consistent. Some projects will require a lot of detail, so their business plan might be about 30 pages long. On the other hand, other projects will be limited to the essentials and their business plan might be only a few pages. There is only one rule: get to the point to convince the reader of your document.

Guide to creating an e-commerce business plan

Because each project is unique, there is no universal e-commerce business plan template suitable for all projects. However, there are some elements that you should necessarily include in your business plan. Here is a business plan template you can follow.

Index

First you should start with a table of contents in which you should list the different parts you will cover in your e-commerce business plan. The table of contents makes the document much easier to navigate.

Writing an Executive Summary

When writing an e-commerce business plan, the introduction should be devoted to the executive summary. It consists of a relatively short part of about 2 pages, but very important in writing your e-commerce business plan.In this part you should summarize what your e-commerce project consists of to give an overview of your e-commerce.

Elements to include are: company name, nature of your business, values and history of the project, target audience and market type (competitors, size, opportunities). It is often essential to introduce the management team.

E-commerce presentation.

The purpose of this third part of your e-commerce business plan is to present and provide an overview of your e-commerce business.

In this part you will need to state the name of your e-commerce, your goals, the type of products you will sell, the industry in which you will operate and its characteristics, and what you think are your strengths that will set you apart from your competitors. At this stage try not to write a papyrus, do not go into too much detail regarding the financial part and your marketing strategy, you will have the opportunity to dwell in later parts on these two points. Rather, your ecommerce presentation should focus on the industry in which you operate and show the opportunities there.Also, try to explain what elements will differentiate you from other ecommerce businesses. If you are using the business plan to apply for financing, explain the usefulness of this financing for your project without going overboard.

Introduce your people

Introduce the education, background and skills of each member of your team. You will need to specify the role of each of your collaborators and that of each co-founder. You also need to designate the person who will serve as the company's legal representative and manager.

The goal is to explain the importance of the people who will work with you and their usefulness to your e-commerce in order to convince potential funders and partners of the relevance of the project.

Description of the product or service

In this part of your e-commerce business plan you will need to talk about the products you want to sell in your e-commerce and what kind of need they meet.

You will first need to describe the characteristics of the product or service you wish to sell on your e-commerce, how it can be used, and what distinguishes the products you wish to sell from those already on the market.

Do a market analysis

To write an e-commerce business plan properly, there are three main elements that you will necessarily need to include in your market study:

• Supply: you will need to identify the supply available in your target market. Competitors are the key component. It is important to know how many competitors are in the market, the variety of their offerings and the prices they charge. Understanding their e-commerce strategy is also essential to understanding the existing supply in the market.
• Demand:you will need to carry out a careful study of the target customers, their consumption habits, average budget, unmet expectations, etc.
• A potential market gap:you will have to identify one or more needs that your competitors do not meet allows you to determine the advantages that can be exploited by your e-commerce to position yourself better.

The best way to identify your target market is to go out and meet your customers, competitors and other market players. The rule is simple: to create your e-commerce business plan, you must be able to understand the concrete expectations of your future customer base.

Good to know: it is rare not to have competitors. There is always competition, even if it is indirect. Warning. For many investors, the absence of competitors is a sign of an idea that the public is not interested in, or worse, a company that has not analyzed the market properly.

Defining an e-commerce strategy

To define an e-commerce strategy, many entrepreneurs resort to the classic 4Ps method also called mix marketing.

• Price: it must contain the list of products and/or services offered by the company, the proposed formulas and detailed prices (price list, scaled rates, etc.).
• Product: a catalog of goods and/or services should be drawn up, indicating the characteristics of each product, packages offered, promotional offers, etc.
• Place: the distribution strategy must be carefully defined. It must be determined through which channels the company will sell its products or services (e-commerce site, social networks, etc.)
• Promotion (communication): this point corresponds to the communication strategy.

The important thing is to plan a feasible and profitable strategy, no matter how big or small your business is.

Business strategy defines how the business will succeed in the marketplace. The communication strategy is about making your e-business known to future customers.

Determine your communication strategy

Determining your communication strategy to draft a business plan allows you to:

• Define your business image: this is about giving your business its own identity by choosing its graphic charter (logo, colors, etc.) and its sales pitch (keywords to use to trigger a sale).
• Publicize your business: it is necessary to determine the channels that will be used to promote your business (creating a website, social networks, newspapers, TV, advertising in transportation, etc.).

Communication strategy should not be neglected in the e-commerce business plan. Today, thinking about an online communication strategy especially when it comes to e-commerce is an essential element if you want to keep your project alive.

The Financial Plan

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The financial plan allows you to make an estimate of the future financial situation of your e-commerce business. The financial plan needs to be adapted depending on who you are addressing, the goal is to say the essentials and put the calculations in the appendix. You will mainly need to address the following points:

• Initial Expenses and Capitalization: Talk about the cost required to start your business and the revenue you could make from it.
• 12-month (month by month) and three-year (quarter by quarter) profit and loss projection
• A 12-month cash flow projection and a three-year cash flow projection (quarter by quarter)
• A projected budget at the start and end of years 1-3
• A breakeven calculation

The business plan is the first step to think about before starting a project, so you can figure out whether your project will have a smooth life or encounter problems in the short or long term.

Making an e-commerce business plan is essential, not only if you are looking for investors or getting a loan, but also to understand if your project is feasible, carry out all the steps in your business plan to reach your goal!