Revenue:
Expenses:
EBITDA:
Net income:
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Carl Torrence is a Content Marketer at Marketing Digest. His core expertise lies in developing data-driven content for brands, SaaS businesses, and agencies. Carl’s work has been featured in Famous Bloggers, The Inspiring Journal, and AllTopStartups.
Sean is the Senior Editor for The Ecomm Manager. He's spent years getting to know the ecommerce space, from warehouse management and international shipping to web development and ecommerce marketing. A writer at heart (and in actuality), he brings a deep passion for great writing and storytelling to ecommerce topics big and small.
The ecommerce market is full of innovative ventures that started as an ecommerce business plan. This guide tells you how to convert your vision for an ecommerce company into a strategic plan.
Click and Cart Revolution: Ecommerce is massively expanding, now a $6.31 trillion market, expected to rise above $8 trillion by 2026. Online sales are booming, making now a ripe time for starting an ecommerce venture.
Blueprint for Success: An ecommerce business plan is essential, serving as a detailed roadmap for starting, running, and growing an online store. It includes market analysis, product details, and financial strategies to achieve business goals.
Investor's Compass: A well-crafted ecommerce business plan is crucial for attracting investment, showcasing your business model, revenue generation plans, and overall strategy to build brand value and equity in the competitive market.
DIY Business Plan: Creating an ecommerce business plan involves outlining your vision, analyzing the market, and detailing operational strategies. An essential step includes drafting an executive summary that encapsulates the company's mission, history, and unique selling points.
Ecommerce is rapidly growing around the world. We love to buy our little treats and trinkets on the internet.
The industry has reached a market valuation of $6.31 trillion worldwide and is expected to cross $8 trillion by 2026.
In 2023, ecommerce accounted for 20.8% of all retail sales .
The contribution of ecommerce is expected to grow even further to cover 24% of retail sales in 3 years.
This seems like a good time for anyone thinking about starting an ecommerce business. Despite many companies enjoying pieces of this $6 trillion pie, starting an online store is not a piece of cake (pause for laughter...).
As with any other business, you need research and careful planning before jumping into action. That’s exactly what this guide is about.
I will shed light on some basic business concepts, discuss examples, provide insights with statistics, and give you ready-to-use templates for various stages.
But first, let’s begin with the fundamentals.
An ecommerce business plan is a document containing the roadmap for initiating, maintaining, and expanding an online selling company.
This document contains several details that are crucial for establishing your ecommerce business.
It serves to guide the formation of a company and draw insights to make business decisions to achieve short-term and long-term goals.
The ecommerce business plan also contains information about the market, competitors, products, pricing strategy, company finances, supply requirements, etc. The more details you can add to an ecommerce business plan, the better you can execute it.
An ecommerce business plan acts as a roadmap for your online business, helping you navigate the market and scale your brand. It's your ecommerce north star, so to speak.
It helps you analyze the market systematically and develop strategies to stand out from the competition. This plan covers various aspects of your business, such as your goals for marketing, operations, and finances, and shows how these parts are connected.
For example, it can help you see how your marketing budget affects your overall cash flow. You’ll get these insights from the market research and financial sections of your business plan.
If you’re looking for funding, a business plan is essential. Investors use it to assess the feasibility of your business. It outlines your business strategy and makes a strong case for why you need investment.
Entrepreneurs can highlight their operational plans and budget to show how they will run a successful ecommerce store.
Most importantly, it demonstrates the value proposition to potential investors, showing how the company will generate revenue, build brand value, and increase equity.
Let’s look at the step-by-step process for creating an ecommerce business plan.
Each of these stages will help you get a deeper understanding of your business. It'll also help you define your vision through organizational structure and processes. Let’s begin with the executive summary.
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Although this is the first part of an ecommerce business plan, it's better to tackle the executive summary after completing the entire document.
The executive summary gives an overview of the business plan on a single page.
The executive summary presents a company overview and highlights of the most important parts of the document.
It gives a brief overview of what the new business is about and what it sets out to achieve. You will discuss these points in-depth later in the document.
You can use the below template to draft your executive summary:
Why does the company exist? "To provide eco-friendly products that promote sustainable living." | |
Origin and background of the company "Founded in 2010 as a small eco-friendly shop, now expanded to a global online presence." | |
Key leadership figures and their qualifications "Jane Doe, CEO, MBA from Harvard, 15 years in ecommerce." | |
Individuals or entities with a stake in the company "Founders, investors, key employees." | |
Specific market segment the company serves "Eco-conscious consumers aged 25-45." | |
Items the company will sell "Reusable bags, bamboo toothbrushes, eco-friendly cleaning products." | |
Services offered to customers "Subscription boxes, personalized eco-living consultations." | |
What makes the products or services unique "Products made from 100% recycled materials, carbon-neutral shipping." | |
How the company stands out against competitors "Exclusive partnerships with green manufacturers, award-winning customer service." | |
External products or services required "Sustainable packaging suppliers, logistics providers." | |
Future financial outlook "Projected revenue of $1M by year 2, break-even by year 3." | |
Cost and types of resources required "Initial investment of $500K for inventory and marketing." | |
Strategic objectives "Become the leading online retailer for sustainable products within 5 years." |
You will have better clarity regarding some of these aspects after you complete the entire ecommerce business plan.
For instance, you can provide a more accurate competitive analysis after conducting market research.
Similarly, you will have a clear understanding of financial projections and investment requirements after you source potential suppliers.
You can create a rough draft of the executive summary at the beginning. Then you can circle back to it when you have more clarity.
Tips for an effective executive summary:
In this section, you provide details about your brand. At this point, the ecommerce business plan begins to take shape.
Start filling out the details in the template below to describe your company using the examples to help give it some shape.
What will the company do, and how does it help the target customer? Why will the company succeed? "Providing eco-friendly products to promote sustainable living. Our unique products cater to the growing demand for sustainable solutions, ensuring market success." | |
What core values will the company uphold in customer service, operations, and employee management? "Sustainability, Integrity, Innovation, Customer Centricity." | |
What roles are needed to run the company's operations? "CEO, Operations Manager, Marketing Team, Customer Support, Logistics Manager." | |
Where will the company's office be located? "Headquarters in San Francisco, with additional offices in New York and London." | |
What resources does the company already possess? "Established supply chain, experienced management team, proprietary technology, initial funding of $1M." | |
What additional resources are needed for the company to be operational? "Additional funding of $500K, office space, skilled labor, marketing tools, logistics partners." |
In this section, you'll outline what your company will look like and what it'll do.
You'll detail the types of people needed to run the company, along with the resources you already have and the ones you'll need.
For example, if you've already purchased a domain name and registered your company name as a trademark, you can list these as existing resources.
If you still need to develop an ecommerce website, list that under required resources (and find the right ecommerce platform to make your job easier).
This section also provides an overview of your company’s hierarchy and management team. Describe the different departments in your company and the key team members for each one.
You should also specify which operations will be done in-house and which will be outsourced to external agencies .
This part of your business plan will give you a clear picture of your current status and help you identify what you’re missing. Keep in mind, this section may change as you do more research and discover new requirements.
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In this section, you'll define details about the products and services your ecommerce brand will offer. You'll describe what you're offering to your customers.
It includes both products and services. You can use the ecommerce business plan template below to define these aspects.
Various names of your products. : Key characteristics of the product. Unique features of the product. Advantages and benefits for the customer. How the product can be used. Different versions or variations of the product. Manufacturing cost per unit. Selling price of the product. | |
Name of the service. Key characteristics of the service. Who provides the service. Unique features of the service. Advantages and benefits for the customer. Cost to provide the service. Selling price of the service. | |
Name of the product or service being priced. Strategy used to price the product or service (e.g., cost-plus, competitive pricing). Expected profit margin. |
While you might only sell products on your ecommerce platform , you could also be selling services (which many ecommerce platforms allow you to do).
For each product, include a short description and pricing information. Specify whether you're selling physical or digital products, and explain how customers will receive them.
Describe any services you provide, such as digital subscriptions or in-person consultations. Specify how customers will access these services and any relevant pricing information.
This is the most important part of an ecommerce business plan. You must analyze several factors concerning the market segment, competing brands, and competitor products.
You must understand how your products, services, and brand perception compares against the competition .
Use the template below to create a detailed overview of the market you will compete against.
Who are the potential customers? "Eco-conscious millennials aged 25-40, living in urban areas, interested in sustainable living." | |
Create a detailed profile based on different target audiences. "Jane, 30, urban professional, shops online for eco-friendly products, values sustainability and quality." | |
What specific needs does your ecommerce business fulfill? "Providing high-quality, eco-friendly household items." | |
What challenges or problems does your company resolve for customers? "Difficulty finding reliable eco-friendly products at affordable prices." | |
Where are your customers? "Primarily in the US and Europe, with growing interest in Asia and Australia." | |
Brand name of competition. Where does the competitor stand in the market? What are the competitor's strengths? What are the competitor's weaknesses? How is the competitor similar to your business? How is the competitor different from your business? Which marketing channels does the competitor use? |
This analysis will affect several other aspects of your ecommerce business plan.
At this stage, you must analyze the market and decide what place your company can take in the competitive landscape. You can also use other methods for market research, such as SWOT analysis or Porter’s Five Forces analysis.
Regardless of the method, you need an accurate understanding of what your competitors offer and how you can differentiate your ecommerce brand.
This brings us to marketing.
Components of a strong market analysis:
The marketing plan for an ecommerce business primarily depends on three factors.
These are the target audience, customer segmentation, and market forces. You will draw relevant insights from the market analysis to define your marketing plan.
Here's a template to help you define the marketing strategy for your online store.
How will you differentiate your brand in the market? Example: "Positioning as a premium eco-friendly brand that combines sustainability with luxury." | |
Which products are relevant to this audience segment? Example: "Eco-friendly household items." Age, gender, income level, etc. Example: "25-40 years old, both genders, middle to high income." Lifestyle, values, interests. Example: "Values sustainability, enjoys outdoor activities." Where is this audience located? Example: "Urban areas in the US and Europe." What are their main interests? Example: "Eco-friendly living, wellness." What motivates their purchases? Example: "Quality, sustainability, brand reputation." How will they use the product? Example: "Daily household use, gifting." How will the product be positioned for this segment? Example: "Premium quality with eco-friendly credentials." | |
Which marketing channels will you use to reach and acquire new customers? Example: "Instagram, Facebook, Google Ads." Key features of the channel. Example: "Visual content, targeted advertising." Types of content used (e.g., videos, blogs). Example: "Short videos, infographics, sponsored posts." Which stages of the funnel will this channel target? Example: "Awareness, consideration." Which audience segments will you target on this channel? Example: "Eco-conscious millennials." How does the audience behave on this channel? Example: "Engages with visual content, shares posts." Types of campaigns to run on this channel. Example: "Influencer partnerships, seasonal promotions." | |
What tools are necessary for running your ecommerce marketing? Example: "Hootsuite for social media management." Key features of the tool. Example: "Scheduling, analytics, team collaboration." How will the tool be used? Example: "Managing social media posts, tracking engagement." Which channels will the tool connect to? Example: "Instagram, Facebook, Twitter." Is the tool free, paid, or subscription-based? Example: "Subscription-based pricing." |
Your marketing plan should clearly outline how you'll position your brand in the market.
Define the channels you'll use at different stages of the sales funnel. For example, you might use Facebook ads to raise awareness and email marketing to engage existing customers.
Include sections to define your ideal customers using buyer personas. Create different personas for various types of potential customers, associating each persona with a specific product and its use cases.
Finally, list the ecommerce tools you'll need for your marketing efforts, such as automation tools, CRM software , and SEO tools.
Once you know how to attract your audience, the next step in your ecommerce business plan is to define how you'll convert them into customers.
At this stage, you will define several aspects concerning your customers.
These include purchase journeys and after-sales services. This strategy serves as an extension of the marketing plan.
See the template below to define your sales and customer service strategy.
Approaches and techniques used to close sales. Example: "Consultative selling, solution selling." Services provided after the sale to ensure customer satisfaction. Example: "Warranty services, returns processing." | |
Methods used to identify and reach potential customers. Example: "Cold emailing, social media outreach." Locations or platforms where sales transactions occur. Example: "Online store, mobile app, pop-up shops." Tools used to support sales activities. Example: "CRM software, sales automation tools." | |
Methods through which customers find and engage with the business. Example: "SEO, content marketing, social media." | |
Methods through which the business reaches out to potential customers. Example: "Email campaigns, cold calling, direct mail." | |
How sales transactions are processed. Example: "Online payment gateways, mobile payment options." | |
How the company stays in touch with customers post-sale. Example: "Follow-up emails, feedback surveys, loyalty programs." | |
Organization of the sales team. Example: "Sales manager, account executives, sales representatives." | |
Different stages in the customer interaction process. Example: "Pre-sale inquiries, post-sale support, ongoing engagement." Platforms used for customer communication. Example: "Email, live chat, phone support, social media." Tools used to manage customer service. Example: "Helpdesk software, customer feedback tools, knowledge base." Organization of the customer support team. Example: "Support manager, support agents, technical support specialists." |
With this template, you are essentially defining customer experience with your brand. You'll create a strategy for selling the products on different channels.
These include ecommerce websites, marketplaces, affiliate websites, social media, etc. You'll have to define the sales process for each channel.
You must also draft a plan to create memorable customer experiences. This is crucial for developing a community.
It also has a direct impact on sales and revenue. Repeat customers spend 67% more than first-time buyers. Once you have a strategy for acquiring customers, you must build a strategy for delighting and retaining customers.
The supply chain strategy includes the journey of the product from the supplier to the customer.
It includes procurement, manufacturing logistics, warehousing , distribution, order fulfillment , and reverse logistics . Use the template below to create your supply chain strategy.
Where do your products come from? Example: "Local manufacturers, international suppliers." Specific details about one of your procurement sources. Name of the supplier or manufacturer. Example: "ABC Manufacturing Co." What products are sourced from this supplier? Example: "Eco-friendly cleaning products." How much product is sourced? Example: "10,000 units per month." Cost per unit from the supplier. Example: "$2.50 per unit." | |
Time it takes for products to be delivered from suppliers. Example: "2-3 weeks." How will you manage the procured inventory? Amount of inventory held. Example: "50,000 units." Size of the warehouse required. Example: "10,000 sq ft." Locations of warehouses. Example: "San Francisco, New York, London." Primary markets where orders will be fulfilled. Example: "North America, Europe." How will and managed? Example: "Using an system. How will inventory be replenished? Example: "Just-in-time replenishment based on sales data." | |
How will you move the products through the supply chain? Example: "Using third-party logistics providers." Vendors used for logistics. Example: "FedEx, DHL." Different stages in the movement of inventory. Example: "From manufacturer to warehouse to customer." Methods used to transport goods. Example: "Air, sea, road." How will inventory be distributed to various locations? Example: "Centralized distribution from main warehouse." Process for fulfilling customer orders. Example: "Using automated order processing systems." How will returns be handled? Example: "Setting up a dedicated returns center." Total cost of logistics operations. Example: "$5 per unit." |
In this section of the ecommerce business plan, you will outline how the product will make its way to the customer.
Supply chain management involves everything from sourcing the products from a supplier to shipping the products to the customer.
Alongside the strategy, you also need to define the stages that you will outsource. Creating your supply chain is quite resource intensive.
That's why ecommerce businesses outsource certain aspects to 3PL companies . Some of the commonly outsourced services include distribution and logistics (42%), manufacturing (37%), product finishing (29%), and packaging (23%).
This process accounts for a significant portion of ecommerce expenses. It will also impact several customer-facing aspects of the business. This includes the availability of stock, shipping charges , delivery time, and more.
Hence, you should define a supply chain strategy for speed, efficiency, and cost-effectiveness.
In this section, you will also cover the applicable legal frameworks for running the ecommerce business .
These include business registration, taxation, permits, legal structure, trade laws, etc. Use the template below to define the legal obligations in your ecommerce business plan.
What are the legal and compliance obligations of the company? Example: "Ensuring all business activities comply with federal, state, and local laws." | |
Required business registrations. Example: "Registering the business with the state, obtaining an EIN from the IRS." | |
Necessary product registrations. Example: "FDA registration for food products, CE marking for electronics." | |
Required trade permits. Example: "Import/export permits, health and safety permits." | |
Necessary product licenses. Example: "Licenses for selling specific products such as alcohol or pharmaceuticals." | |
Relevant regulatory bodies. Example: "FDA, FTC, OSHA, local health departments." | |
Business taxes that apply. Example: "Corporate income tax, payroll tax, property tax." | |
Sales taxes that apply. Example: "State and local sales taxes, use tax." | |
Required insurance coverage. Example: "General liability insurance, product liability insurance, workers' compensation insurance." |
You must understand the laws applicable to running an ecommerce business in your region.
If you plan to ship products internationally, you must also understand international shipping laws, customs clearance requirements, import/export regulations, and trade laws in the target market.
This section ensures that your company always remains on the right side of the law.
The final section of an ecommerce business plan is concerned with finances and legal compliances.
The preceding sections will give you estimates regarding different aspects of your ecommerce business.
These include operations, marketing, procurement, logistics, and so on.
Based on these estimates, you will define the financial projections for your ecommerce business. This includes both revenue and expenses.
You can use the template below to define the financial aspects of your business.
How much funds will you need to start the ecommerce business? Example: "Initial capital requirement is $150,000." The . Example: "$150,000." Detailed allocation of the startup budget. Example: "Inventory: $50,000, Marketing: $30,000, Technology: $20,000, Legal and Compliance: $10,000, Miscellaneous: $40,000." | |
What is the annual budget required to run the business? Example: "Annual operating cost is projected at $120,000." The overall annual cost. Example: "$120,000." Detailed allocation of the annual budget. Example: "Salaries: $50,000, Marketing: $20,000, Inventory Restocking: $30,000, Technology: $10,000, Miscellaneous: $10,000." | |
How many products will the company sell each year after initiating? Example: "Projected to sell 10,000 units in the first year." Expected profit margins per product. Example: "20% profit margin." Projected revenue per year. Example: "$200,000 in the first year." | |
How long will it take for the company to recover the investment? Example: "Expected to break even within 18 months." Projected growth in sales and revenue year over year. Example: "20% annual growth rate." Projected annual costs over the years. Example: "$120,000 in the first year, $140,000 in the second year." The point at which revenues will cover costs. Example: "Achieved at $150,000 in sales." Detailed analysis of expected profits and losses over time. Example: "First-year profit: $40,000, second-year profit: $60,000." |
If you pitch the ecommerce business plan to an investor, you must add other details to this section.
These would include funding requirements, funding stages, value offerings, etc. This section of your business plan also sheds light on a company’s assets and liabilities.
You must also clarify what you offer the investors against the funds. This can be equity stake, debt, dividends, and so on.
This helps potential investors conduct a cost-benefit analysis.
You can go a step further and present key elements of cost-benefit analysis for the ecommerce company. This should highlight the short-term and long-term gains for the new business.
You can use this section to show potential investors how your new business will grow in market value based on milestones. These milestones can be defined based on sales, inventory size, revenue, market acquisition, etc.
With this section, you conclude your ecommerce business plan.
You need to revisit the executive summary and ensure it aligns with the rest of the document. It is best to review the entire document a few times to ensure you present a unified vision for starting and running your ecommerce business.
With your fresh business plan in hand, you're ready to get moving on the foundational parts of your ecommerce journey.
To start strong, you want to choose an ecommerce platform that has all the essential features that ensure your business will be a success.
You can also take a peek at what we think are the top ecommerce platforms for a variety of brands, from big to small. Here's our shortlist of the best ones out there:
The purpose of creating an ecommerce business plan is to represent your vision systematically.
This document will shed light on several aspects of your ecommerce business idea. It will also serve as a guide, philosopher, and friend when you launch your company.
If you are pitching your idea to investors, this document will show them the value that your ecommerce business idea can generate for them.
The next step for you is to turn the ecommerce business plan into a company.
You should subscribe to The Ecomm Manager newsletter for more news, trends, tips, and guides related to ecommerce. These articles can help you optimize and expand your business further.
There are always more questions for the end of the post. So, here we are, answering some more questions.
The profitability of ecommerce businesses depends on several factors. This includes market condition, business structure, product demand, revenue model, etc. You can understand the profitability of your ecommerce business idea by checking brands selling similar products. When first starting out, you can cut costs by leveraging tools like free inventory management software . This can help ease the financial burden of being a new business.
A business plan gives structure to an ecommerce business idea. It is a really helpful document for business owners and entrepreneurs. This document helps you measure the viability of the business model, products, marketing strategy, financial plan, legal structure, operations, and other aspects of the company.
Written by Dave Lavinsky
Whether you are planning to start a new ecommerce business or grow your existing ecommerce business, you’ve come to the right place to write an ecommerce business plan.
We have helped over 10,000 entrepreneurs and business owners create ecommerce business plans and many have used them to start or grow their own ecommerce businesses.
Below is a sample of each of the key elements of an ecommerce business plan template to help you write your own business plan:
Business overview.
TrendyFit.com is a startup ecommerce store that sells fitness clothes and accessories for the young, trendy, and stylish individual who enjoys working out and staying fit. The clothes are unique and designed to fit the latest trends of the most popular online YouTube or TikTok celebrities, yet functional and comfortable for working out at the gym or just hanging out. All products are made in the United States, are made with the highest quality fabric, and come with a money-back customer guarantee if the fit or style doesn’t satisfy the customer. TrendyFit.com is sold exclusively online; no retailers will be carrying any TrendyFit.com products.
TrendyFit.com is owned by Devon Ming. Devon will utilize a dropshipping company to receive all orders placed on TrendyFit.com, fulfill the order, and ship directly to the consumers. Devon will also employ a team of three creative designers to develop the website and social media presence by utilizing targeted social media ads and will recruit social media influencers as brand ambassadors. Devon will also employ a team of two customer service representatives to ensure complete customer satisfaction.
The following are the services to be offered by TrendyFit.com:
TrendyFit.com will target all fitness enthusiasts and trendsetters in the United States and internationally. The target market will be social media savvy and spend a large portion of their day browsing through their social media sites. The ideal customer will be young, either in high school or college, a working professional, or a gym rat who frequents the trendiest fitness gyms and establishments.
Devon Ming is a graduate of Harvard University’s Business School and after graduation, has spent the last three years developing the brand image, vision, and researching products for TrendyFit.com. Devon wanted to utilize his Master’s degree in Business Strategy & Marketing, and has devoted all of his time and energy into launching his ecommerce store.
As CEO of TrendyFit.com, Devon will oversee the strategy and development of the company. He will be in constant communication with the dropshipper, creative team, and customer service representatives. He will also focus on strategic growth and the long term vision of the company.
TrendyFit.com is primed for success by offering the following competitive advantages:
TrendyFit.com is seeking $200,000 in debt financing to launch TrendyFit.com. The funding will be dedicated for the down payment with the dropshipping company, three months of payroll expenses for the creative team and customer service representatives, and any business licensing necessary. There will also be funding dedicated to the social media campaign and website development. The breakout of the funding is below:
The following graph below outlines the pro forma financial projections for TrendyFit.com.
Who is trendyfit.com.
TrendyFit.com is a startup ecommerce store that sells fitness clothes and accessories for the young, trendy, and stylish individual who enjoys working out and staying fit. The clothes are unique and designed to fit the latest trends of the most popular online YouTube or TikTok celebrities, yet functional and comfortable for working out at the gym or just hanging out. All products are made in the United States and come with a money-back customer guarantee if the fit or style doesn’t satisfy the customer. TrendyFit.com is sold exclusively online; no retailers will be carrying any TrendyFit.com products.
TrendyFit.com is owned by CEO Devon Ming and will be sold exclusively through a dropshipper that has agreed to fulfill all product orders placed by TrendyFit.com and ship within the continental United States in 2-3 business days and within one week to anywhere outside of the continental United States. Devon has placed his pricing model to be competitive with other popular online fitness clothing retailers, but more affordable as the base of his customers will be young and not have as much disposable income as other individuals outside of the target market.
Devon Ming has spent the last three years developing the brand image, vision, and researching products for TrendyFit.com. After graduating from college with a Master’s degree in Business Strategy & Marketing, Devon has devoted all of his time and energy into launching his ecommerce store.
Since incorporation, TrendyFit.com has achieved the following milestones:
TrendyFit.com will offer the following ecommerce products:
As a result of a significant shift from traditional retail to online retail, the E-Commerce industry is expected to grow to over $835 billion in the next five years. Data shows that consumers prefer the convenience of finding, comparing and purchasing products online easily and quickly.
The industry’s main drivers include faster internet speeds, an increase in mobile internet connections, accelerating per capita disposable income growth and the continued surge in internet traffic volume.
Strong economic conditions will also aid retailers that purchase inventory from overseas, while revenue growth and wage growth are expected to continue their strong trajectory over the next five years as technology continues to boost worker productivity.
The greatest opportunity for growth will come from product categories that were traditionally dominated by brick-and-mortar shopping, including groceries, major appliance products and clothing.
Demographic profile of target market.
Total | Percent | Male Percent | Female Percent | |
---|---|---|---|---|
Total population | 327,167,439 | (X) | (X) | (X) |
AGE | ||||
Under 5 years | 19,646,315 | 6.00% | 6.20% | 5.80% |
5 to 9 years | 19,805,900 | 6.10% | 6.30% | 5.80% |
10 to 14 years | 21,392,922 | 6.50% | 6.80% | 6.30% |
15 to 19 years | 21,445,493 | 6.60% | 6.80% | 6.30% |
20 to 24 years | 21,717,962 | 6.60% | 6.90% | 6.40% |
25 to 29 years | 23,320,702 | 7.10% | 7.40% | 6.90% |
30 to 34 years | 22,023,972 | 6.70% | 6.90% | 6.60% |
35 to 39 years | 21,571,302 | 6.60% | 6.70% | 6.50% |
40 to 44 years | 19,927,151 | 6.10% | 6.10% | 6.00% |
45 to 49 years | 20,733,440 | 6.30% | 6.40% | 6.30% |
50 to 54 years | 20,871,804 | 6.40% | 6.40% | 6.40% |
55 to 59 years | 21,624,541 | 6.60% | 6.50% | 6.70% |
60 to 64 years | 20,662,821 | 6.30% | 6.10% | 6.50% |
65 to 69 years | 17,107,288 | 5.20% | 5.00% | 5.50% |
70 to 74 years | 13,464,025 | 4.10% | 3.90% | 4.40% |
75 to 79 years | 9,378,512 | 2.90% | 2.60% | 3.10% |
80 to 84 years | 6,169,441 | 1.90% | 1.60% | 2.20% |
85 years and over | 6,303,848 | 1.90% | 1.40% | 2.50% |
TrendyFit.com will primarily target the following customer profiles:
TrendyFit.com will face competition from other ecommerce businesses with a similar company profile. A summary of the competitor companies is below.
Nike is a popular consumer products company that designs, develops, and markets their product line of footwear, apparel, equipment, and accessory products worldwide. It designs athletic, casual, and leisure footwear for men, women, and children. Nike’s footwear products include running, training, basketball, football, soccer, sport-inspired urban shoes, and children’s shoes. Nike, named for the greek goddess of Victory, also markets sports-inspired products for children and various competitive and recreational activities. Nike also sells sportswear under the Converse brand. The company, which generates some 60% of sales outside the US, sells through more than 1,090-owned retail stores worldwide and an e-commerce site, and to thousands of retail accounts, independent distributors, licensees and sales representatives. Customers in North America account for about 40% of total revenue.
Nike is headquartered in Beaverton, Oregon and was initially founded as Blue Ribbon Sports in 1962. The company rebranded as Nike in 1972 and the company went public in 1980.
Under Armour makes performance clothes for doing battle on the sports field and in the gym. The company offered collegiate, National Football League (“NFL”) and National Basketball Association (“NBA”) apparel and accessories, baby and youth apparel, team uniforms, socks, water bottles, eyewear and other specific hard goods equipment that feature performance advantages and functionality similar to our other product offerings. The company also makes technology that helps customers track their fitness. It sells online, by catalog, and through retail and outlet stores worldwide. Under Armour operates worldwide but generates most of its revenue in North America.
Under Armour’s marketing and promotion strategy begins with providing and selling their products to high-performing athletes and teams at the high school, collegiate and professional levels. They execute this strategy through outfitting agreements, professional, club, and collegiate sponsorship, individual athlete and influencer agreements and by providing and selling their products directly to team equipment managers and to individual athletes.
Under Armour was founded in Washington, DC, in 1996 and moved to Baltimore, Maryland, two years later. It promoted apparel specifically for athletes, fabric designed to keep them cool when it is hot and keep them warm when it is cold. It continued focusing on the sports world, inking supplier or licensing deals with the NHL, MLB, and USA Baseball in the early 2000s. Under Armour went public in 2005. The following year the company moved into footwear with a line of football cleats; it eventually became the official footwear supplier to the NFL.
Lululemon athletica inc. is a designer, distributor and retailer of lifestyle inspired athletic apparel and accessories. The Company’s segments include Company-operated stores and direct to consumer. Its apparel assortment includes items such as pants, shorts, tops, and jackets designed for a healthy lifestyle including athletic activities such as yoga, running, training, and other sweaty pursuits. It also offers fitness-related accessories. Its direct to consumer segment includes electronic commerce website www.lululemon.com, other country and region-specific websites, and mobile applications, including mobile applications on in-store devices. Its Company-operated stores include approximately 491 stores. Its Company-operated stores are branded lululemon and Ivivva. The Ivivva branded stores specializes in athletic wear for female youth. It also offers weekly live classes, on-demand workouts and one-on-one personal training through its subsidiary.
TrendyFit.com will be able to offer the following competitive advantages over their competition:
Brand & value proposition.
TrendyFit.com will offer the unique value proposition to its clientele:
The promotions strategy for TrendyFit.com is as follows:
TrendyFit.com will blow up social media sites with targeted ads and TrendyFit.com will be seen on all major social media sites (Facebook, Instagram, Twitter, YouTube, TikTok, SnapChat, etc.). A large portion of the funding will go towards purchasing targeted ads and having a creative team to develop the social media advertising.
Devon’s creative team will also develop a professionally designed and visually appealing website to gear customers to when they click on the social media ad. The website will have a gallery of all the available products, shipping information, return information, FAQ’s, etc. The SEO will also be managed to ensure that anyone searching “trendy fitness apparel” or “trendy clothes for young adults”, will see TrendyFit.com listed at the top of the Bing or Google search engine.
TrendyFit.com will recruit a team of social media influencers who have over 100k followers on at least one social media site. By having the brand ambassadors post of TrendyFit.com and wear the clothing, TrendyFit.com will gain a massive amount of followers because one of their favorite internet celebrities is wearing the brand. The brand ambassadors will include a code in their post and will be paid a portion of revenue for whomever purchases from TrendyFit.com using that code.
The pricing of TrendyFit.com will be moderate and on par with competitors so customers feel they receive value when purchasing its products.
The following will be the operations plan of TrendyFit.com.
TrendyFit.com will have the following milestones completed in the next six months.
6/1/202X – Finalize agreement with dropshipping company for them to receive orders directly from TrendyFit.com website, fulfill them, and ship straight to consumers.
6/10/202X – Hire team of Creative Designers to begin design work on the TrendyFit.com website and social media platforms.
7/15/202X – Begin social media campaign for TrendyFit.com.
8/1/202X – Recruit team of brand ambassadors.
8/15/202X – Hire team of Customer Service Representatives.
9/1/202X – TrendyFit.com website officially launches and goes live. Customers are now able to place orders on TrendyFit.com.
Devon Ming will be the Owner and CEO of TrendyFit.com.
Devon Ming is a native of San Jose, California and attended college in Cambridge, Massachusetts at Harvard University. After subsequently being accepted into Harvard’s prestigious business school and graduating, Devon spent the next three years developing the brand image, vision, and researching products for TrendyFit.com. Devon wanted to utilize his Master’s degree in Business Strategy & Marketing, and has devoted all of his time and energy into launching his ecommerce store.
As CEO of TrendyFit.com, Devon will oversee the strategy and development of the company. He will be in constant communication with the dropshipper, creative team, and customer service representatives. He values the customer service representatives as much as the rest of the team because he wants to get involved on customer feedback and any issues they are having. He can then implement those issues and feedback to the creative team and adjust product design if necessary. He will also ensure complete customer satisfaction and make sure the dropshipper is aware of any customer issues with product packaging and delivery.
As TrendyFit.com becomes more and more popular, Devon will be prepared for growth and hire a CFO when necessary and when the company is able to afford to do so. When the company is primed for growth and its dominance in the market is made, Devon and future CFO will strategize on a plan to take the company public.
Key revenue & costs.
The revenue drivers for TrendyFit.com will be the revenue obtained from all products sold on TrendyFit.com.
The cost drivers will be the cost to maintain the dropshipper per the contract. The dropshipper will receive fees on all products it fulfills and ships. Other cost drivers will be the salaries for the creative team and customer service representatives. Lastly, other cost drivers will be the costs for purchasing targeted ads on various social media sites and maintaining the website.
Key assumptions.
The following outlines the key assumptions required in order to achieve the revenue and cost numbers in the financials and in order to pay off the startup business loan.
Income statement.
FY 1 | FY 2 | FY 3 | FY 4 | FY 5 | ||
---|---|---|---|---|---|---|
Revenues | ||||||
Total Revenues | $360,000 | $793,728 | $875,006 | $964,606 | $1,063,382 | |
Expenses & Costs | ||||||
Cost of goods sold | $64,800 | $142,871 | $157,501 | $173,629 | $191,409 | |
Lease | $50,000 | $51,250 | $52,531 | $53,845 | $55,191 | |
Marketing | $10,000 | $8,000 | $8,000 | $8,000 | $8,000 | |
Salaries | $157,015 | $214,030 | $235,968 | $247,766 | $260,155 | |
Initial expenditure | $10,000 | $0 | $0 | $0 | $0 | |
Total Expenses & Costs | $291,815 | $416,151 | $454,000 | $483,240 | $514,754 | |
EBITDA | $68,185 | $377,577 | $421,005 | $481,366 | $548,628 | |
Depreciation | $27,160 | $27,160 | $27,160 | $27,160 | $27,160 | |
EBIT | $41,025 | $350,417 | $393,845 | $454,206 | $521,468 | |
Interest | $23,462 | $20,529 | $17,596 | $14,664 | $11,731 | |
PRETAX INCOME | $17,563 | $329,888 | $376,249 | $439,543 | $509,737 | |
Net Operating Loss | $0 | $0 | $0 | $0 | $0 | |
Use of Net Operating Loss | $0 | $0 | $0 | $0 | $0 | |
Taxable Income | $17,563 | $329,888 | $376,249 | $439,543 | $509,737 | |
Income Tax Expense | $6,147 | $115,461 | $131,687 | $153,840 | $178,408 | |
NET INCOME | $11,416 | $214,427 | $244,562 | $285,703 | $331,329 |
FY 1 | FY 2 | FY 3 | FY 4 | FY 5 | ||
---|---|---|---|---|---|---|
ASSETS | ||||||
Cash | $154,257 | $348,760 | $573,195 | $838,550 | $1,149,286 | |
Accounts receivable | $0 | $0 | $0 | $0 | $0 | |
Inventory | $30,000 | $33,072 | $36,459 | $40,192 | $44,308 | |
Total Current Assets | $184,257 | $381,832 | $609,654 | $878,742 | $1,193,594 | |
Fixed assets | $180,950 | $180,950 | $180,950 | $180,950 | $180,950 | |
Depreciation | $27,160 | $54,320 | $81,480 | $108,640 | $135,800 | |
Net fixed assets | $153,790 | $126,630 | $99,470 | $72,310 | $45,150 | |
TOTAL ASSETS | $338,047 | $508,462 | $709,124 | $951,052 | $1,238,744 | |
LIABILITIES & EQUITY | ||||||
Debt | $315,831 | $270,713 | $225,594 | $180,475 | $135,356 | |
Accounts payable | $10,800 | $11,906 | $13,125 | $14,469 | $15,951 | |
Total Liability | $326,631 | $282,618 | $238,719 | $194,944 | $151,307 | |
Share Capital | $0 | $0 | $0 | $0 | $0 | |
Retained earnings | $11,416 | $225,843 | $470,405 | $756,108 | $1,087,437 | |
Total Equity | $11,416 | $225,843 | $470,405 | $756,108 | $1,087,437 | |
TOTAL LIABILITIES & EQUITY | $338,047 | $508,462 | $709,124 | $951,052 | $1,238,744 |
FY 1 | FY 2 | FY 3 | FY 4 | FY 5 | ||
---|---|---|---|---|---|---|
CASH FLOW FROM OPERATIONS | ||||||
Net Income (Loss) | $11,416 | $214,427 | $244,562 | $285,703 | $331,329 | |
Change in working capital | ($19,200) | ($1,966) | ($2,167) | ($2,389) | ($2,634) | |
Depreciation | $27,160 | $27,160 | $27,160 | $27,160 | $27,160 | |
Net Cash Flow from Operations | $19,376 | $239,621 | $269,554 | $310,473 | $355,855 | |
CASH FLOW FROM INVESTMENTS | ||||||
Investment | ($180,950) | $0 | $0 | $0 | $0 | |
Net Cash Flow from Investments | ($180,950) | $0 | $0 | $0 | $0 | |
CASH FLOW FROM FINANCING | ||||||
Cash from equity | $0 | $0 | $0 | $0 | $0 | |
Cash from debt | $315,831 | ($45,119) | ($45,119) | ($45,119) | ($45,119) | |
Net Cash Flow from Financing | $315,831 | ($45,119) | ($45,119) | ($45,119) | ($45,119) | |
Net Cash Flow | $154,257 | $194,502 | $224,436 | $265,355 | $310,736 | |
Cash at Beginning of Period | $0 | $154,257 | $348,760 | $573,195 | $838,550 | |
Cash at End of Period | $154,257 | $348,760 | $573,195 | $838,550 | $1,149,286 |
You can download our free e-commerce business plan template PDF here . This is a business plan template you can use in PDF format. You can easily complete your ecommerce business plan using our Ecommerce Business Plan Template here .
What is an ecommerce business plan.
An e-commerce business plan is a plan to start and/or grow your online business. Among other things, it outlines your business idea , identifies your target customers, presents your marketing strategies and details your financial projections.
Launching an e-commerce business is an exciting venture with the potential for substantial rewards. To maximize your chances of success, follow this strategic roadmap.
1. Conduct In-Depth Market Research: Thoroughly analyze your target market, identify consumer pain points, and discover product gaps. This research will be the cornerstone of your business strategy, informing product selection, pricing, and marketing efforts.
2. Craft a Compelling Business Plan: Develop a solid business plan outlining your business goals, target audience, unique value proposition, business model, sales strategies, and financial projections. This document will serve as your roadmap and a valuable tool for attracting potential investors or securing loans.
3. Choose a Profitable Product Niche: Select a product niche that aligns with your passion and possesses strong market demand. Consider factors such as competition, profit margins, and scalability when making your decision.
4. Build a Strong Brand Identity: Create a memorable brand name, logo, and visual identity that resonates with your target audience. Develop a compelling brand story to foster customer loyalty and emotional connections.
5. Develop a User-Centric E-commerce Store: Design an online store that is visually appealing, easy to navigate, and optimized for conversions. Prioritize fast loading times, clear product descriptions, high-quality images, and secure checkout processes.
6. Source Reliable Suppliers: Establish relationships with reputable suppliers who can provide high-quality products at competitive prices. Consider factors such as order fulfillment times, shipping options, and return policies.
7. Optimize Pricing Strategy: Conduct thorough market research to determine competitive pricing for your products. Implement effective pricing strategies, such as discounts, promotions, and tiered pricing, to maximize revenue and profitability.
8. Masterful Marketing and Promotion: Develop a comprehensive marketing strategy that leverages various sales channels, including social media, search engine optimization (SEO), email marketing, and paid advertising. Create compelling content that engages your target audience and drives traffic to your store.
9. Fulfill Orders Efficiently: Implement a streamlined order fulfillment process to ensure timely and accurate delivery of products. Consider using order management software and partnering with reliable shipping carriers.
10. Prioritize Customer Satisfaction: Build a strong customer support system to address inquiries and resolve issues promptly. Encourage customer feedback and implement improvements based on customer insights.
By following these steps and continuously adapting to market trends, you can build a thriving e-commerce business that generates sustainable profits.
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Home > Business Plan Templates > The Ultimate E-Commerce Business Plan Template With Examples
Apr 26, 2024 | Business Plan Templates
This customised business plan template is specifically designed for those crafting a strategy for an e-commerce business. It contains every essential element of the e-commerce business plan that you need to consider—from your Executive Summary to the important Appendices. It has all the key components: Business Description, Market Analysis, Business Structure and Team Composition, Products and Services, Marketing and Sales Strategy, Operational Plan, and Financial Analysis, including Projections.
This template is structured to be comprehensive yet straightforward, simplifying the process of writing an e-commerce business plan . The added examples provide context and make the content more relatable. Yet, they can be swapped with specific details relevant to the planned e-commerce business.
Table of Contents
The executive summary serves as a brief introduction to your e-commerce business, summarising the key points of your business plan. It is normally best to prepare this section last, allowing you to cover all the vital inputs from your marketing plan.
Start with a clear snapshot of your business. What’s its name? What does it sell? Is it a B2B or B2C e-commerce store? Make this information gripping and engaging.
Example: XYZ Fashion Boutique is an online clothing store specialising in trendy and affordable apparel for women and men, focusing primarily on the B2C market.
Specify your e-commerce business’s mission and vision statement. This should spell out your company’s objectives, strategic goals, financial plan and commitment to your cause.
Example: Our mission is to offer high-quality fashion at accessible prices while providing an exceptional and seamless online shopping experience. Our vision is to become a leading online fashion boutique, empowering individuals to express themselves through our trend-led fashion.
Explain your e-commerce business model. Detail how your own e-commerce business now generates revenue. Does it dropship products, produce its own goods, act as an affiliate, or use a different model?
Example: XYZ Fashion Boutique operates on a dropshipping business model, allowing us to offer a wide variety of products without needing physical inventory, thereby significantly reducing operational costs.
Lay out your short-term and long-term business goals first. These should be SMART (Specific, Measurable, Achievable, Realistic, Time-bound) goals.
Example: Our key goal over the next year is to increase our monthly website traffic by 60% and to boost conversion rates by 3%. In the long term, we aim to expand our product offerings and enter international markets.
This section offers a deeper insight into your business, explaining what it is, what it does, and its status in the e-commerce landscape.
Start by introducing your e-commerce business, discussing when and why it was founded, and what needs it targets to address.
Example: XYZ Fashion Boutique was founded in 2018 with a vision to make trendy, affordable fashion accessible through a convenient, user-friendly online shopping platform.
Explicitly mention your e-commerce platform. Is it a standalone website, or do you use third-party platforms such as Amazon or eBay? Why did you choose this platform?
Example: Our store operates on Shopify, a robust e-commerce platform that offers great customisation options, integrated payment gateways, and a user-friendly interface.
Identify what makes your e-commerce business unique. You can highlight distinctive product offerings, customer service, pricing model, or any other specific strengths here.
Example: Our unique sales proposition lies in our trend-led designs at affordable prices, along with efficient customer service and speedy, reliable delivery.
Specify your business’s legal structure. Is it a sole proprietorship, partnership, a Limited Liability Company (LLC), or a different type of entity?
Example: XYZ Fashion Boutique is a Limited Liability Company (LLC), ensuring our personal assets are protected should the business incur debts or liabilities.
This segment offers an overview of your e-commerce landscape, including the competitors you face, the potential customers you target, and the opportunities you aim to seize.
Provide a brief overview of the current e-commerce and specific product category landscape, discussing its size, growth rate, and trends.
Example: In the thriving e-commerce industry, the online fashion sector has grown exponentially over the past few years, driven by consumer demand for variety and convenience.
Elaborate on your target market. Detail their demographics, behaviours, and shopping habits.
Example: Our primary target market includes fashion-forward men and women ages 18-35 who value style and affordability. They are tech-savvy and prefer online shopping for its convenience and variety.
Describe your main competitors and analyse their strengths and weaknesses. Discuss what sets your business apart.
Example: While our competitors offer fashionable attire, not all of them provide the combination of trendy, affordable, and quality products that we do. We also emphasise fast shipping and responsive customer service to distinguish ourselves further.
Explain how your e-commerce business is positioned to better address the needs of your target market than your competition’s e-commerce businesses.
Example: Our store is positioned as a go-to online destination for on-trend yet affordable fashion, aiming to provide an unmatched shopping experience through exceptional customer service and a smooth user interface.
This section delves into the structure of your e-commerce business and introduces the key players in your team.
Discuss the structure of your online business now. How is the management organized? Who manages the website, inventory, customers, ads, and similar aspects if it’s an online store?
Example: XYZ Fashion Boutique employs a well-structured management team comprising an operations manager, customer service representatives, a digital marketing specialist, and a part-time accountant to effectively manage various business aspects.
Give brief profiles of the core team members and explain their roles. Highlight their relevant experience and skills.
Example: Our Operations Manager, Jane Doe, has over five years of experience in the e-commerce sector, successfully managing various online stores. She oversees daily operations, from order processing to inventory management.
Detail the outsourced tasks. This could include website development, SEO, content creation, etc.
Example: We outsource our website maintenance and SEO to a digital services agency, a decision driven by their expertise and cost-effectiveness compared to hiring in-house.
If you have mentors or advisors, introduce them briefly and mention how they contribute to the business.
Example: Our advisor, John Smith, a veteran in the retail industry, provides invaluable advice on strategic planning and business expansion.
This section provides detailed information about the products or services your e-commerce business offers, explaining how they meet the needs and preferences of your target customers.
Provide a comprehensive description of your products or services. Highlight their features, benefits, and what makes them unique or appealing to ideal customers.
Example: XYZ Fashion Boutique offers a wide range of clothing items, from casual wear to formal attire. Our products stand out for their high quality, trendy designs, and affordable prices.
Describe your pricing strategy. How do you price your products or services compared to your competitors, and why?
Example: We follow a competitive pricing strategy, keeping our prices slightly lower than our competitors while still maintaining product quality. This strategy caters well to our target customers, who seek quality fashion at affordable prices.
Discuss how your products are created, sourced, stored, and delivered to customers.
Example: We operate on a dropshipping model, procuring products directly from trusted suppliers, which are then shipped to the customers, eliminating the need for storage. The suppliers have been selected for their reliable product quality and efficient delivery services.
Explain where your products or services are in their life cycle. Are they in the growth stage, maturity stage, or decline stage?
Example: Given the constant need for fashionable garments, our products exhibit a rapid life cycle and are constantly updated with new trends to match consumer demand.
This chapter discloses how your e-commerce business plans to promote its products or services and its sales plan to convert prospects into sales.
Explain your strategy to generate awareness and interest from potential investors in your e-commerce business. Detail how you plan to reach and engage your target market.
Example: Our marketing strategy utilises digital channels, including social media, email marketing, SEO, and PPC ads. We strive to create compelling content that resonates with our own target audience of consumers, from the latest fashion blogs to engaging social media campaigns.
Outline your sales strategy. Describe how you plan to transform interested prospects into paying customers.
Example: We utilise a mix of aggressive retargeting campaigns, personalised email marketing, and offering time-sensitive discounts to entice customers to complete their purchases.
Discuss your customer retention strategies. How do you ensure that the first-time customers become recurring customers?
Example: We prioritise providing an excellent shopping experience through a user-friendly website, exceptional customer service, and incentive initiatives like loyalty programs and personalised offers to encourage repeat purchases.
What key performance indicators (KPIs) will you track to measure the success of your marketing and sales strategies?
Example: We track KPIs such as website traffic, conversion rate, average order value, customer acquisition cost, and customer lifetime value to measure and optimise our marketing and sales strategies.
This section conveys a company overview of your e-commerce business’s daily operations, indicating how it functions and establishing timelines for execution.
Describe how your orders are processed and delivered. How are customer inquiries, complaints, or returns handled?
Example: Once an order is placed, our automated system alerts the suppliers, who pack and ship the product directly to the customer. Within 24 hours, our in-house customer service team handles customer inquiries, complaints, or returns.
Provide information regarding your suppliers if applicable. What are your backup plans in case of supply chain disruptions?
Example: Our suppliers are reputable manufacturers from overseas. To mitigate supply chain disruptions, we have alternate suppliers for each product category lined up.
Discuss how your inventory management works, especially if you’re not dropshipping.
Example: As a dropshipping business, we avoid traditional inventory management challenges. However, we regularly check our suppliers’ stocks and update our website accordingly to prevent overselling.
List some of the tools and technology you use to run your operations efficiently. This could include e-commerce platforms, customer service tools, email marketing software, etc.
Example: We use Shopify for our e-commerce platform, ZenDesk for customer service, MailChimp for email marketing, and Google Analytics for tracking and analysing website data.
This section delves into the financial elements of your e-commerce business, detailing how you will generate revenue and manage your costs.
Identify your primary revenue streams. Is it purely product sales, or do you have other income sources like affiliate marketing, ads, or membership fees?
Example: Our major revenue source is product sales. However, we generate minor income through affiliate marketing and ads on our blog pages.
Break down your high costs. These could include website operation costs, marketing expenses, taxes, shipping costs, and any other significant expenditures relevant to your business model’s operations plan.
Example: Our major costs include website operation and maintenance, advertising and promotional expenses, taxes, transaction fees, and customer service expenses.
Present your financial projections for the company description for the next five years, including projected revenue, costs, and net profit.
Example: We project a steady 20% YoY growth in revenue over the next five years as we expand our product range and enter new markets. Our costs are expected to grow by 15% YoY, primarily due to planned increases in marketing spend and product diversification.
Detail your break-even point. When does your e-commerce business expect to become profitable?
Example: With our current cost structure and projected growth rate, we anticipate breaking even at the end of the second year.
This section comprises any additional documents or supportive content related to your business plan.
Include screenshots of your e-commerce website to provide visual insights into your product offerings, website design, layout, and user interface.
Example: Enclosed are screenshots of our homepage, product pages, and shopping cart page to give a glimpse of our user-friendly website interface and varied product range.
Include any market research that supports your business plan. This could be from recognised industry reports, customer surveys, or other relevant data.
Example: Included are excerpts from the ‘Online Fashion Retail Report 2021’ that underscore the growing demand for online fashion shopping, particularly within our target demographic.
If available, provide detailed financial statements such as income statements, cash flow statements, balance sheets, etc.
Example: The detailed financial statements for the past two years, enclosed, demonstrate our business’s steady growth and robust financial health.
By using this template, business owners or potential entrepreneurs can efficiently outline their plans, anticipate potential challenges, establish clear goals, and define strategies to achieve them. Ultimately, this tool will guide you in shaping an effective business plan to navigate your business idea or e-commerce venture towards success.
Remember, although the template provides a sturdy structure, it’s crucial to tailor your free business plan template to reflect your unique business situation, market dynamics, and strategic intentions. Business planning is not a ‘one-size-fits-all’ task; your business plan should echo the distinctive heartbeat of your e-commerce endeavour.
Good luck with your business planning!
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Dream of being your own boss? So do lots of other people, including 64 percent of the UK workforce and 65 percent of Americans . And I’m sure you’d see similar figures across a bunch of other countries.
I get it—after all, I did it myself.
But sadly, not every business is destined to become the next Amazon, Google, or Sleeknote.
Much-quoted data from the US Bureau of Labor Statistics show that about one in five new businesses survive for 12 months or less , while only half make it to the five-year mark:
So what separates the successes from the also-rans and the never-weres?
While some people will tell you the secret to “making it” lies in adopting a rise-and-grind mentality , truth is there is any number of reasons why some businesses thrive and others fail.
But I can categorically tell you there’s one thing every successful startup has in common, and that’s a killer e-commerce business plan.
What is an e-commerce business plan, why do i need an e-commerce business plan, how to write an e-commerce business plan.
E-commerce business plans are roadmaps that plot the route to achieving your business goals. They set out who you are, what products you sell, and how you plan to operate (among many other things).
Just like a real roadmap, e-commerce business plans also highlight potential hazards, helping you plot alternate routes well in advance.
No one expects you to stick precisely to your original plan throughout the entire lifespan of your business. But by gathering business-critical information like cash flow, sales projections, and marketing budgets in a single place, your business plan can help you build a persuasive pitch to win backing from investors, which can be absolutely vital at the start of your journey.
And even if you’re not looking for external funding, figuring out your strengths, weaknesses, and objectives early on will save you a lot of pain down the line.
I know what you’re thinking: “I’ve got a to-do list as long as my arm; why should I spend days or weeks writing a business plan? Why can’t I just get on with it?”
You’re not completely wrong. Honestly, if you think buying a house or having a baby is stressful, try starting a business.
One study claims the biggest challenge founders face in the first three months is building a customer base, but there are countless others.
From dealing with suppliers to building a website and chasing invoices, it’s one headache after another, and you never feel like you have enough time to give each problem your full focus.
But you really can’t afford to overlook your e-commerce business plan. Here are five benefits to creating one.
You might like to think of yourself as a visionary, but I can pretty much guarantee that someone, somewhere has had a similar business idea to yours.
They might have been doing it for years, or they might be gearing up to hit the market at the same time as you.
Either way, you need to know about them, and the research you carry out while building a business plan will naturally help you do that. Which means you’ll be better placed to differentiate yourself through marketing.
Another key element of creating a business plan is assessing the market you’re trying to reach. That means digging into who you’re selling to, where they hang out online and “in real life”, and what they’re looking for in a product like yours.
Why would they buy it? When would they buy it? How much would they spend on it?
All of that will help inform your messaging .
Unless you have a metaphorical (or literal) gold mine to fall back on, money is definitely going to cause you a few headaches in the early days of your business.
Even successful e-commerce companies struggled to keep the lights on when they were just starting up.
Building a business plan will help you identify potential sources of financial backing, like angel investors, business loans, venture capitalists, or wealthy business partners.
There’s a reason Amazon started out as an online bookstore, rather than immediately selling every product you could ever imagine.
As an e-commerce startup, you need a niche . Ideally, you need to go further and find a niche within a niche. Rather than founding a womenswear e-commerce site, launch one that’s 100 percent sustainable and carbon-neutral. Or instead of selling regular sunglasses, sell sunglasses made from hemp (I don’t know, I’m just spitballing here).
My point is, all the other research you’ve done at this stage—studying your competitors, understanding your audience, figuring out your pricing strategy—will naturally guide you toward the best niche with the biggest opportunities.
Admittedly, recruitment might not be on your immediate agenda.
But if things go well, you’re going to need a little help in the not-too-distant future. You might need people in the warehouse, a customer success agent or two, a marketing team, a developer, someone to handle the finances… The list is huge.
Problem is, a lot of other businesses want to get their hands on those people, too.
If you don’t want recruitment to constrain your growth, start reaching out to potential candidates early, using the information in your business plan to get them bought into your project.
Hopefully, by this point, I’ve demonstrated the value of creating an e-commerce business plan. Now, let’s dive into how to do it.
There are no hard-and-fast rules to how long a business plan should be. The more complex the business, the more in-depth the plan. But as a minimum, your business plan should include these seven sections:
You might want to add a few more too. For instance, if you’re entering a largely untapped niche, you might want a section dedicated to the audience you’ll be targeting.
But for most e-commerce businesses, those seven categories should do the job.
Think of this as the “elevator pitch” element of your business plan.
Your goal here is to sum up the rest of your business plan in no more than one page, communicating key information to time-poor reviewers, and (hopefully) tempting them to read on.
Generally, you should look to answer the following questions:
Again, heed the word “overview”. Like the executive summary, this is a concise section that demonstrates who you are, what you do, and why people should care.
Whether you’re seeking investment or planning your e-commerce marketing strategy , it’s vital you get all this information down in one place. Make sure to include your:
A bad product in a good market stands a chance of success.
If you don’t believe me, check out your own purchase history—if you’re anything like me, you’ll have bought your fair share of useless products that sounded amazing when you saw them online.
But a good product in a bad market doesn’t have a cat in hell’s chance. You might be completely changing the game; solving a problem that’s never been solved before. But if no one’s prepared to spend money on it, you’ve not got a business—you’ve got a hobby.
The market analysis stage of your e-commerce business plan should help you find the right market: one with lots of customers who have an immediate need for the “thing” you’re selling (and enough money to buy it). Your market analysis should incorporate the following elements:
It’s impossible to come up with a meaningful financial projection without first estimating the number of people who are potentially interested in buying your product.
Of course, to do that, you first need to figure out who your customers are.
The more demographic and psychographic information you have on them, the more accurately you’ll be able to gauge the scale of your market.
At the same time, remember to factor in broader industry trends. If you’re starting an e-commerce store that exclusively sells gas cans, you might have some early growth potential, but bear in mind there’s a good chance we’ll all be driving electric cars within a decade—in which case your whole market will have dried up.
No e-commerce brand is an island.
To stand out against the competition, you need to find some way to differentiate yourself. That could be through:
SWOT analyses are about assessing your business’s:
Typically, a SWOT analysis is presented as a simple, four-section grid, with bullet points under each heading. Here’s a beautifully presented example from the creative geniuses at Asana :
In a sense, your whole e-commerce business plan will be centered on your products and services.
However, given their importance to your business prospects, a section of your plan should be dedicated solely to outlining what you’re selling.
If you only sell one product or plan to launch with a very small range, give plenty of detail on each. But if you stock a wide selection of products, stick to general features and benefits such as price, unique selling points, and materials.
Additionally, be sure to reference any new products you’re planning to launch in the near future, along with any intellectual property you own.
We know who you are and what you’re selling.
Now’s your chance to explain how you’re going to sell it.
As a marketer, I’m well aware that a marketing plan could easily run to thousands of words, and it can be hard to know where to start—you’ve likely got a lot of ideas about positioning and messaging. To make your life a little easier, use the so-called “four Ps of marketing” as the backbone of your marketing plan:
Discuss the first three relatively briefly, as you’ll cover them in greater depth in other parts of your e-commerce business plan.
Reserve the most detail for that final “P”: promotion. That’s the real meat and drink of your marketing strategy.
This might not be the “sexiest” part of your e-commerce business plan, but it’s important to discuss the systems and processes that will help you reach your goals. Specifically, you’ll want to cover:
Whether you’re seeking backing from an external investor or simply trying to understand your projected revenue and costs, a financial plan is a crucial element of your e-commerce business plan. Most are broken down into three elements.
Designed to demonstrate your revenue sources and expenses over a month, quarter, or year, the income statement also highlights your all-important bottom line. Subtract expenses from revenue and you’ll see whether you’re in profit or loss.
Of course, if you’re yet to launch your e-commerce business, these figures can be projected.
The balance sheet is used to calculate the level of equity in your business—that is, the amount you’d be left with if all debts were paid and assets cashed. To work it out, subtract liabilities (things like loan repayments, wages, and accounts payable) from assets (such as stock and equipment).
Lastly, your cash flow statement is like a real-time version of your income statement. That’s because it takes into account when cash goes in and out of your business, based on when payments are received and debts settled.
Calculating and projecting cash flow should help you identify periods when you’re likely to be in surplus or short on money, which gives you time to prepare.
Sure, an e-commerce business plan requires a whole lot of work.
But as Abraham Lincoln supposedly said: “Give me six hours to chop down a tree and I will spend the first four sharpening the axe.”
All that time spent analyzing your audience, honing your messaging , and crunching the financial numbers will give you a better chance of making it through those tough early days and scaling effectively when the time is right.
And honestly, no one ever said starting a business is easy.
Emil Kristensen
Emil is the CMO of Drip. When he’s not busy writing awesome content and building the Drip brand, he spends his time reading blog posts and listening to podcasts.
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minute read
Writing an eCommerce business plan is one of the first steps you should take if you’re thinking about starting an online business. Whether you’re opening an online-only shop or adding an eCommerce component to your brick and mortar store for an omnichannel retail experience, there’s never been a better time to sell online.
The numbers don’t lie: since 2014, the number of digital shoppers worldwide has grown from 1.32 billion to 2.14 billion. That’s a 62% increase! Currently a $4.28 trillion market, eCommerce is forecasted to make up a fifth of all retail sales by 2024. If you want a slice of the climbing profits, now is the time to get involved.
An eCommerce business plan can help you steer your online shop in the right direction. Fortunately, you don’t need a business degree to create one. Read on to:
Learn everything you need to know build, launch and grow an online store with this free guide.
A business plan is a document that outlines the goals of a business and how the business will achieve those goals. While there is no standard format for a business plan, such documents typically cover what the company will do, what problem it will solve, how the business is structured, who the target market is and how the product or service stands out from the competition.
A business plan serves as a roadmap for your company and helps you stay focused. Having one is also useful for attracting investors and business partners, as it shows you’re serious about your business, have done your research, know your industry and have considered the challenges you may face along the way.
While the structure of a business plan for an eCommerce business won’t differ much from a business plan for any other type of company, the business strategy at the core of the plan may differ greatly from that of a traditional retail store.
For example, a traditional retail business plan might describe plans for leasing and designing a storefront. An eCommerce business plan, in contrast, would focus on the company’s digital storefront: its website. One of your business goals for the first year might be identifying the best eCommerce software , rather than finding the perfect space to lease.
Another notable distinction: while a traditional retail business plan might include an organizational chart with many front of house staff members, an eCommerce business plan would emphasize roles in online customer service , fulfillment and marketing.
Now, if you already run a brick and mortar business and are adding an online selling component, you’ll want to cover all of the topics listed above.
Now that you understand what a business plan is, why you need one, and what differentiates an eCommerce business plan from a traditional retail business plan, it’s time to get into the good stuff. Read along to learn exactly how to write an eCommerce business plan.
This section concisely introduces everything that you’ll be covering in your business plan. Write it last, so that you can source inspiration from the rest of the document.
Explain what your company does and what makes it stand out. Use the company introduction to answer the following questions:
What does your business do?
What problem does it solve, and how?
Going through the exercise of considering these questions and putting your answers into writing will sharpen your focus as a business owner. When opportunities present themselves that don’t align with your values or help you solve your customers’ problems, then you can say no without doubts — or, conversely, you can enthusiastically accept opportunities that align with your vision.
Get to know your customers and competition. Do some soul searching and conduct market research to uncover:
Now it’s time for the less sexy stuff. In this section of your eCommerce business plan you should explain:
Explain what makes your eCommerce shop shine: its products and services. Describe, in detail:
Having great products is fantastic, but that in itself is useless if people don’t know about your products. Include your marketing strategy in your eCommerce business plan to show your team and investors how you’ll get your products in front of customers.
Your marketing strategy should include:
This is the juiciest section of your business plan. It helps you set sales and fundraising goals that will let you explain to investors where you stand financially and why you need their investment.
If your business is pre-revenue, include:
If your business already exists, include information like:
Now that you know everything there is to know about how to start an eCommerce business, it’s time to craft your business plan. Follow the template below to set yourself up for success.
Company name:
Founders/leadership team:
Products/services:
Target market:
Marketing strategies:
Business model:
Mission statement:
Company values:
Ideal customer:
Market size:
Competitive analysis:
What makes your business different from the competition? What are your advantages and opportunities?
Legal structure:
Leadership team:
Organizational chart:
Product/service 1:
Product/service 2:
Product/service 3:
Pricing, positioning and profit margins:
Manufacturing/supply chain:
Intellectual property claims:
SWOT analysis:
Marketing channels:
Marketing goals and KPIs:
Revenue (projected or actual):
Profit or loss:
Investments:
Budget vs. actuals:
When you record what you want to achieve and how you’re going to achieve it, you’re more likely to turn your vision into a reality. Take the time to think about your business, find out what makes your products different, and be thoughtful about how you’re going to find customers.
When you’re ready to build your eCommerce shop, turn to Lightspeed’s eCommerce platform. Watch a demo to learn more.
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Executive summary executive summary is a brief introduction to your business plan. it describes your business, the problem that it solves, your target market, and financial highlights.">, opportunity.
As E-commerce continues to accelerate, so does the problem of merchants and manufacturers needing to process returns. The average rate of returns for Internet-based companies is 9%. In the coming year the value of returned merchandise was $1.5 billion. Every one of these transactions involves financial processing. Many of them require physical shipping of physical goods, plus processing the goods as received. This is a huge hassle.
NoHassleReturn.com strives to position itself as a strategic partnership between online merchants, Web hosting companies and portals, shipping companies, and online payment agents such as credit card issuers. Due to demand aggregation, the strategy will produce reduced or totally free shipping of returned merchandise to consumers. This differentiating element will multiply the consumer acceptance factor and will draw more revenues to all participating companies. The proposed program is therefore a win-win solution to all parties involved. Moreover, the software architecture and website format will be wireless-friendly thus designing the service in such a way that consumers will later be able to easily use it via cellular phones and other personal wireless devices
E-commerce continues to accelerate and the amount of money spent on purchases made through the Internet shows no sign of decline. During the past holiday season (November 20 to December 19), retailers saw online revenues quadruple, jumping 300% to about $11 billion and far exceeding expectations, according to a study by Shop.org and Boston Consulting Group. The study of 30 retailers in such categories as apparel, books and music, home and garden, specialty foods and electronics showed a 270% growth in the number of orders. The study indicated that online sales were growing at 145% annually and it projected online retailer revenues of more than $36 billion for last year. An earlier study conducted by Ernst & Young, before the holiday frenzy, already estimated that total revenues for online retail and consumer products for the calendar year just completed were around $25-30 billion. Currently, the average rate of returns for Internet-based companies is 9%. In the coming year the value of returned merchandise was $1.5 billion. This indicates an amazing opportunity.
The company foresees three types of competition for the services we offer: Direct
If we prove successful, others will follow. Our most worrisome competition would be combining delivery and/or courier services, like something of this type owned or partnered with UPS or FEDEX.
The first competitors to the new service are the online retailers themselves. Since NoHassleReturn.com will need to strike partnerships and strategic agreements with retailers in order to offer its services, they are classified as internal competitors.
With NoHassleReturn.com, at least one selling opportunity will be given to retailers while consumer is on the Web–something a partnership with a carrier cannot provide. Moreover, serving as a demand aggregator NoHassleReturn.com should be able to arrange necessary agreements and provide consumers with greatly reduced, or even free, shipping for all returned merchandise.
Thinking in reverse to the previous paragraph, service providers such as Mail Boxes Etc. and PostNet may try to forge strategic partnerships with numerous online retailers to simplify the return process.
Our mission is to enhance customer service of online merchants, boost their customer retention and increase their sales. We strive to improve the overall image of the online merchant and therefore stimulate growth of online shopping. We put our efforts to increase customer satisfaction when consumers deal with retailers, to enhance the interaction process when retailers communicate with consumers, and to streamline the problem resolution order in all possible ways.
NoHassleReturn.com’s financials are conservative yet quite promising. Once they are up and running and sign up some merchants as customers, NoHassleReturn.com will quickly gain momentum and generate impressive sales.
Financing needed.
We need $50,000 to start. We will get that from the two owners to start $25,000 each.
Problem worth solving, our solution.
NoHassleReturn.com is an e-commerce start-up company positioning itself to become the market leader in offering online merchants and consumers a uniform and trouble-free way to return merchandise purchased online. The company offers a business-to-business solution to online merchants of physical, non-perishable products. The company utilizes a consolidation approach in handling all product returns that allows online merchants to instantly save bad sales, restore customer satisfaction and stimulate repeat sales, while offering consumers a convenient, centralized online location to claim returns. By creating a new service category and utilizing the first-mover advantage, NoHassleReturn.com positions itself for rapid growth and gains a strong opportunity to raise entry barriers for possible competition.
Market size & segments.
E-commerce continues to accelerate and the amount of money spent on purchases made through the Internet shows no sign of decline. During the holiday season (November 20 to December 19), retailers saw online revenues quadruple, jumping 300% to about $11 billion and far exceeding expectations, according to a study by Shop.org and Boston Consulting Group. The study of 30 retailers in such categories as apparel, books and music, home and garden, specialty foods and electronics showed a 270% growth in the number of orders. The study indicated that online sales were growing at 145% annually and it projected online retailer revenues of more than $36 billion for 1999. An earlier study conducted by Ernst & Young, before the holiday frenzy, already estimated that total revenues for online retail and consumer products for the calendar year 1999 were around $25-30 billion.
While a notable amount of positive publicity about the Internet shopping has recently appeared in the media, the number of problems encountered by online shoppers actually increased more dramatically than the sales figures. According to a poll conducted by WebAssured.com, the number of complaints filed between November 25, 1999 and January 13, 2000 was up 404% over the same period last year. Over 62% of the respondents claimed they had experienced at least one problem with an online transaction. Misrepresentation/misinformation and delivering defective products each accounted for at least 22% of all complaints. In the breakdown of types of problems occurred, delivery of a wrong item accounted for 17.2%. These kind of problems ultimately result in product returns that cause additional costs to the consumers and both costs and lost revenues to the retailers.
When a wrong, defective, or misrepresented item was delivered to a consumer, the return process often proved uneasy. According to recent findings by PC Data Online, 30% of all consumers who returned items found the return process difficult. It is apparent that existing return procedures are inadequate and sometimes irritating. The solution, however, does not lie in forcing all online retailers to establish a "no-questions-asked" return policy and to post it clearly at the top of their websites. The entire sequence a consumer has to follow, starting from looking up the procedures on the Web and then having to make a trip to UPS or the Post Office, has to be streamlined. There is clearly a need, as well as an opportunity, for a new service company to improve the overall return process for online shoppers. As a result, the consumer satisfaction will be enhanced and it will translate into increased repeat sales for online retailers.
Market Segmentation
As stated in the previous section, the estimated online retail revenues were around $25-36 billion. Both sources providing the estimates indicated that only merchants selling physical products (books, CDs, electronics, apparel, etc.) were included in the breakdown by category. No mention was made of services such as online hotel reservations, news subscriptions, or online brokerage being included in the total figures. However, it would be advisable to use a more conservative approach when estimating the total revenues of online merchandise sales. Presented below are estimates for Internet retail sales made by National Retail Federation shortly after the 1998 holiday season.
Current alternatives.
Direct Competitors
Based on the current intelligence, there is no independent company out there specializing in a "returned merchandise" service to online consumers. No single company is known to be employing a concept of establishing a single point of presence on the Internet for consumers to claim returns. The current situation allows the new company to gain the first-mover advantage and build entry barriers for any possible new entrants.
Internal Competitors
The first competitors to the new service are the online retailers themselves. Since NoHassleReturn.com will need to strike partnerships and strategic agreements with retailers in order to offer its services, they are classified as internal competitors. Retailers may perceive that their internal return procedures are adequate and fully meet customer demands. However, the discussion under the Need Assessment section of this plan clearly indicated that there are significant drawbacks and shortcomings in the return process across the entire industry. Even companies like Amazon.com that touts a quick and easy return policy now sees its customers go to Barnes & Noble superstores to return books. Partnering with brick-and-mortar retailers may be seen as a solution by some e-tailers. However, from the consumer perspective, there still will not be a centralized location to return merchandise, no quick and easy return procedure, and no savings on shipping costs. Consumers may end up having to go from one physical retailer to another to return various items.
Online retailers may try to partner with carriers and service providers such as UPS, Mail Boxes Etc., or Rite Express. Reportedly, eBay.com is working out an agreement with Mail Boxes Etc. to appoint them as a preferred/exclusive service for product returns. eBay.com may receive rebates per shipment for directing its clients to Mail Boxes Etc., but consumers again will have little or no benefit. The standard shipping rates are applied, the choice of carriers is now limited, and online merchants are not informed about product returns ahead of time so that bad sales could be saved. With NoHassleReturn.com, at least one selling opportunity will be given to retailers while consumer is on the Web–something a partnership with a carrier cannot provide. Moreover, serving as a demand aggregator NoHassleReturn.com should be able to arrange necessary agreements and provide consumers with greatly reduced, or even free, shipping for all returned merchandise.
Channel Competitors
Thinking in reverse to the previous paragraph, service providers such as Mail Boxes Etc. and PostNet may try to forge strategic partnerships with numerous online retailers to simplify the return process. But as it was described, online retailers will be shortchanged in overall customer satisfaction, information exchange, total costs, and additional selling opportunities. Consumers, on the other hand, will lose out on the limited number of "exclusive" carriers for particular retailers, and uniform simplicity in the return process will not be achieved. Moreover, both Mail Boxes Etc. and PostNet combined do not have sufficient physical presence in the market.
Carriers such as UPS and FedEx may try to enter the arena. Those organizations have extensive networks of facilities, experience in shipping, and a track record of quality. The U.S. Postal Service has recently started a TV advertising campaign of a service for online merchants that allows consumers to print return labels online. This is a step towards addressing the shipping end of the return problem, but it falls short of saving bad sales and creating new selling opportunities for merchants. No single shipping company can fully provide the range of benefits the proposed company can. NoHassleReturn.com will be able to arrange strategic alliances with numerous carriers and even play one against the other in negotiating rate reductions and preferential service terms for both merchants and consumers. Being a smaller company with a focus on the e-commerce community, it will also have a greater degree of flexibility in adjusting to customer needs.
At NoHassleReturn.com, we feel we provide a value-added service to a variety of consumers. By having a safe and easy-to-use return service, the company benefits more people than simply the average customer.
Merchants Advantages
Consumers Advantages
In order for the company to operate, a number of specific ingredients are needed. Following are things to put in place before the service can be offered.
Marketing plan.
Because the company’s service is a business-to-business program, it will be initially promoted to online merchants by direct sales force. Personal selling will be necessary to reach decision makers within online organizations. At first, contacts will be made with Internet service providers, such as America Online, that host online stores and shops. America Online claims to have 20% of the total Internet service provider market in the U.S. Therefore, arranging a strategic partnership where NoHassleReturn.com becomes the preferred or exclusive choice for all returned merchandise bought at AOL.com shops will be invaluable for establishing a well-recognized brand and building up entry barriers for any possible competition. Ideally, a company’s banner with a notation "For an Easy, Trouble-Free Product Return Click Here" will be visibly displayed throughout the shopping section of AOL.com. Portals such as Yahoo! will be approached as well. Reportedly, Yahoo! hosts nearly 6,000 merchants where it charges each merchant at least $100 to $300 per month. Arranging a strategic partnership with Yahoo! will provide a strong leverage in negotiating return contracts with individual merchants. Similar to that of America Online, the company’s banner will be displayed throughout the entire shopping section of Yahoo!
Large online merchants such as Amazon.com and Buy.com will be targeted by the direct sales force during the first stage as well. Those companies have already achieved significant volumes of sales–and therefore product returns–and will find the uniform return process of much benefit to them. Strong "category killers" such as eToys and CDnow are also first sales targets. Auction houses such as eBay.com and uBid.com will be approached with a service offer for products sold to consumers by merchants and direct manufacturers.
Wherever possible, smaller online retailers will be personally approached by the sales force. To stimulate awareness and service penetration among smaller players, industrial marketing techniques will be utilized. Those will include advertising in specialized publications such as Internet World and Red Herring, as well as referral fees for retailers who already use the service. Email campaigns will be used to reach decision makers at smaller companies. The email messages will have an invitation to the NoHassleReturn.com website where a specially designed presentation will explain the benefits of the new service. An invitation to be contacted by a service consultant to discuss details will be included.
The company plans to offer its services right before Thanksgiving 2000. In order to stimulate a quicker adoption of the services, the remainder of the year 2000 will be offered free of charge.
It is estimated that the initial expenses to hire a sales force and a customer service unit of up to five people during the first year will be close to $400,000. Another $200,000 will be needed for sales program development, marketing activities, and training (excludes advertising). The initial compensation package for sales force will include a nominal base salary and a progressive commission structure. This should ensure that during the early stage of the company’s growth not only that sales targets are met, but also that customer (customer here means merchant) satisfaction and retention are fully addressed. The sales force will initially be located at the corporate headquarters. A territorial approach will later be implemented, with sales people located in regions. After one year, sales force members will split into two distinct groups. The first group will include pure sales people, the "go-getters" who will be placed in regions and will work on pure commissions. The commission structure will become more progressive and rewarding for such individuals, including a bonus structure. The estimate for an average commission paid on sales is approximately 5-10%. The second group will include client care professionals who will concentrate on customer satisfaction and retention to ensure the continuity of the program. These individuals will remain at the headquarters and will have a base salary with a bonus structure. The base salary for client care professionals is in the mid-five figures. Industrial advertising and promotional expenses in 2000 are estimated at $250,000.
It is also a possibility to sell the services to merchants via the Internet hosting service providers, portals, and software developers. Those companies will then serve as distributors and agents, compensated on commissions. This approach will eliminate the need for a large sales force. The final layout will depend on how quickly agreements with companies such as America Online and Amazon.com are negotiated, how aggressively they will be able to promote the services, and on what conditions.
The following diagram describes the customer approach (customer here means merchant).
Service consultants are the direct sales force that approaches prospective customers with service offers. Once a customer has been signed, a service consultant will only approach the client with new service offers and product upgrades. A client care professional is then assigned to each customer to deal with all customer service issues. Each customer will be advised to direct all service inquiries to the professional. A professional will also proactively call on customers to ensure high quality of service and customer satisfaction. The consultants and professionals will have direct communication lines between themselves to ensure open information exchange and a quick and efficient problem-resolution culture. This structure will guarantee an aggressive sales approach, client-oriented service, and efficient post-sales support.
NoHassleReturn.com will strive to eliminate the shipping costs to consumers by means of strategic agreements with online merchants, shipping companies, and credit card companies. As stated in the last quote, 58% of all product returns were due to merchants’ faults, hence merchants will have to reimburse shipping costs to consumers in those cases. NoHassleReturn.com therefore proposes that 65% of a given shipping cost should be allocated to corresponding merchants. Due to demand aggregation, the company will be able to negotiate a shipping rate discount with companies such as UPS or FedEx. Hence 20% of shipping costs should be allocated to shipping companies in a form of a discount. Credit card issuers such as Chase and BancOne currently offer a 5% rebate to consumers on purchases with selected online merchants. It is therefore feasible to arrange an agreement with credit card companies and/or issuers to include a 5% shipping cost rebate on all returned merchandise. Since product returns are only 9% of all purchases, it will not represent a large cost to credit card companies to add this differentiating feature to their products. These allocations in total will cover 90% of the shipping cost. The remaining 10% will be absorbed by NoHassleReturn.com via a special "instant rebate."
NoHassleReturn.com will charge merchants a program fee that will average only 0.5% of a given merchant’s total sales. Also, the company will charge a low per-claim fee of 12% of each item’s listed price (each item that has been claimed through the company’s website). However, of the 12% charged per item, up to 4% will be instantly given back to merchants to cover the remaining portion of the shipping cost. The previous table indicates that the 4% rebate is sufficient to cover the remainder of the shipping cost in the first product category. It is actually far more than sufficient in other product categories (refer to ASC Coverage Ratio). NoHassleReturn.com can then decide whether to offer merchants a reimbursement of the remaining portion of shipping costs only or a flat 4% "instant rebate" regardless of shipping costs. For the purpose of this business plan and financial projections, a flat 4% "instant rebate" was used thus reducing the per-claim fee from 12% to 8% across the board.
As it was stated in a prior chapter, retailers should see an average sales increase of at least 15% due to the service offered by the company. On the other hand, based on the proposed pricing structure the service should not cost merchants more than 1.5% of their total revenues. The cost-benefit ratio of 10 will be a strong promotional point for NoHassleReturn.com.
While it is a possibility to charge merchants commissions on all sales made through the company’s website (when consumers claim their returns), it would not capture all sales stimulated by the company. The program will increase consumer satisfaction and loyalty. However, when consumers start buying more due to the program’s effect but dealing directly with the merchant, the company will not receive any commissions and will in effect be giving its services away for free. Hence both fees charged should fully reflect the benefits of the easy-return procedure, early information on all returning items, restored customer satisfaction, selling opportunities created during the claim process, and all repeat sales thereafter.
The company also plans to draw revenues from advertising on its website, but for the purpose of this business plan advertising revenues will be considered negligible. A fee/rebate agreement may be arranged with such companies as UPS and Mail Boxes Etc. for bringing customers to them for shipping needs. Other revenue generating activities such as affiliate programs with VISA, American Express, or Citibank can be arranged to promote certain credit cards as a preferred method of payment online. Those revenues will also be omitted in the financial projections. Once the company has generated a sufficient customer database, it may also market information to retailers and other organizations for a fee. Any fees and payments NoHassleReturn.com could generate from consulting activities in the field of product returns will not be included in the financial projections either.
The service positioning in the eyes of online merchants is imperative to the success of the enterprise. The service proposed by the company is a business-to-business solution offered to online merchants of physical, non-perishable products. However, because online consumers will deal directly with the company via its website, the proposed solution also incorporates some features of a business-to-consumer service. It is therefore of utmost importance to clearly define what this company offers is a customer service & customer satisfaction program for online merchants. The most unique feature is that the proposed company takes the systemic problem of product returns and turns it into new selling opportunities for online merchants.
It is also important to note that NoHassleReturn.com does not try to position itself as a competitor to any incumbents with a similar service, online merchants, or shipping companies. The proposed company strives to position itself as a strategic partner to all parties participating in handling product returns. If nothing else, NoHassleReturn.com should be viewed as an outsourcing company to online merchants with the core competency and focus in handling returned merchandise.
The service offered by NoHassleReturn.com is designed to enhance customer retention and loyalty by offering an easy and trouble-free merchandise return process to online shoppers. According to Jupiter Communications, the goal of the 1999 holiday season was not about generating impressive sales, but rather securing long-term relationships. Retailers now need to focus on retention and loyalty. NoHassleReturn.com will help to achieve just that through establishing lasting, productive relationships with online merchants. Providing an easy, uniform, and trouble-free return process to all online shoppers will enhance the overall image of online merchants. While the number of retailers continues to grow, consumers will not have to look up every single one to find out about return policies and later keep abreast for possible changes. A centralized Internet location–the company’s website–will retrieve, summarize, and present the appropriate policies. Based on product information, it will make sure the correct procedures are used. The company’s banner with a notation "For an Easy, Trouble-Free Product Return Click Here" will be placed visibly on retailers’ websites and will serve as a symbol of customer orientation and care.
Moreover, the shipping process will be streamlined. Customers will be able to generate a shipping label on the company’s website thus reducing the hassle at the shipper’s counter. Although some online retailers already supply pre-printed shipping labels for sold items, customers sometimes lose, or throw away, those labels when they first see and like the products they ordered. Shortly after they may change their mind and would like to return a particular item, but the label is gone. With the proposed program, the label is always available online so that consumers can have peace of mind and also reduce the amount of documents they need to keep just in case. The service therefore offers a dual benefit to consumers. The retailers may then choose to stop including a pre-printed return label with every outgoing shipment thus reducing costs of selling. From a shipping company’s perspective, the shipping process is streamlined because the online-generated label will have all the necessary information, possibly including a tracking number if it is going to be shipped by UPS. That way consumers do not have to spend time at UPS counters filling out forms–both a customer service and operations improvement for UPS. NoHassleReturn.com will be a strategic merger between online merchants, carriers, and their partners targeted at overall improvement of customer satisfaction and ultimately the bottom line of merchants.
Another important feature of NoHassleReturn.com is that shipping of returned merchandise should be free of charge to consumers. (Means of achieving it are discussed in more detail in the Pricing and Revenue Generation section.) This differentiating feature will tremendously increase the consumer acceptance factor of the proposed service. The fact that products purchased online can be returned in an easy and trouble-free way, and that shipping is also free, will help expand the entire online shopping industry. The added convenience and peace of mind consumers will gain with NoHassleReturn.com will translate into more shopping with those online merchants that participate in the NoHassleReturn.com program.
When customers go through the sequence of online entries on the company’s website, the retailer whose product is being claimed for return will be offered at least one selling opportunity. At the end of the sequence the retailer will be able to target the consumer with any new sales offers as its website will appear onscreen. Should an exchange or replacement be preferred by the customer during the online return process, the retailer will receive an additional selling opportunity as its website will appear with offers during that step. These opportunities will translate into more sales for retailers. This will also stimulate customer retention, which means repeat sales. All in all, the program will increase customer satisfaction and generate more sales.
The program has a number of unique features. First, it alerts the retailer that a particular customer is claiming a particular product for return as it happens. That way the retailer knows about it as it occurs and not when the merchandise arrives at its warehouse. This allows to plan ahead. Since 9% of all products are returned, this feature offers useful information to better handle logistics and inventory.
Secondly, and more importantly, by asking consumers during the online sequence why they want to return a particular item merchants gain an invaluable piece of information. If the reason for return is defective product (30% of all reported returns), the retailer can save the sale and turn an unhappy customer into a delighted one by sending a new item right away. If the reason for return is wrong color, wrong size, or wrong product altogether (28% of all reported returns), the retailer may choose to send the correct product right then, thus instantly restoring customer satisfaction and saving a bad sale. It will be up to the retailer to decide on payment and credit terms of the exchange. These benefits ultimately translate into increased customer retention, reduced costs, more sales, and improved bottom line.
It is estimated that the program will generate an average sales increase for merchants of at least 15%. Online shopping is still at the early stage of consumer adoption. As stated earlier, about half the people who have not shopped online cited the cost and hassle of returns as a significant factor for not shopping online. Another recent survey found that 89% of online buyers said that return policies influenced their decision to shop with an online retailer. Consumers demand not only convenience but peace of mind. The proposed program offers both and it should increase the number of online shoppers, thus causing a market expansion for online merchants. The first retailers who implement the proposed program will also be able to differentiate themselves and capture a larger market share in their respective segments. Once embraced by the majority of online merchants, the program will become an industry standard.
It is important to note that during the entire process the company will not ask for, or try to gain access to, consumers’ credit card numbers. This will significantly limit possible liabilities and security/confidentiality concerns.
Milestones table.
Milestone | Due Date | Who’s Responsible | |
---|---|---|---|
Nov 15, 2020 | Founders | ||
Jan 27, 2021 | Founders | ||
June 15, 2021 | Founders | ||
June 21, 2021 | Founders | ||
Sept 13, 2021 | Founders | ||
Jan 17, 2022 | Founders |
Our Key Metrics:
Those activities that are not crucial to the corporate success (i.e. payroll) will be outsourced or subcontracted. Below are brief summaries of major responsibilities for corporate officers.
There are two principals that are responsible for the idea and the progress of the firm up. They recognize as the companies quickly grows, certain positions such as CEO and CFO will need to be filled. The company was founded by Steve Logic and Dan Codder. Steve has spent the last ten years at Federal Express. While at FedEx, Steve was responsible for their logistics system. Steve has the incredible skill of perceiving business needs and creating a solution to address the need. At FedEx, Steve was the architect behind their benchmarked logistic system that has the ability to track customer packages and share the information with the client. What this meant for FedEx is that they could tell the customer exactly where their package is at any one point. This logistics system is the main driver behind FedEx’s exponential growth. Dan Codder is a twenty-year veteran in the computer industry. Self taught, Dan has worked at IBM, Cadence, Tektronix, and several other companies. Dan has the ability to design and write computer code very quickly and accurately. NoHassleReturn.com will leverage Dan’s skills for the completion of their customer service software engine.
2020 | 2021 | 2022 | |
---|---|---|---|
Part-Time Disassembly Crew (4.67) | $159,600 | $162,792 | |
Directors (5) | $180,000 | $325,000 | $490,000 |
Sales Manager (0.67) | $40,800 | $41,616 | |
Sales Group (4) | $216,000 | $220,320 | |
Fulfillment Manager (0.67) | $33,600 | $34,272 | |
Fulfillment Group (4) | $172,800 | $176,256 | |
Marketing manager (0.67) | $42,000 | $42,840 | |
Marketing Group (4) | $216,000 | $220,320 | |
Programmers (4) | $360,000 | $367,200 | |
Programmer Manger (0.67) | $60,000 | $61,200 | |
Social Media Group (2.33) | $327,600 | ||
Social Media Manager (0.33) | $50,400 | ||
Disassembly Team (2.33) | $201,600 | ||
Disassembly Team Manager (0.33) | $34,800 | ||
Website Programmers / Bug Finders (2.33) | $462,000 | ||
Website Programmer Manager (0.33) | $72,000 | ||
Shipping Clerks (2.33) | $218,400 | ||
Shipping Manager (0.33) | $39,600 | ||
Office Admins (2.67) | $288,000 | ||
Totals | $180,000 | $1,625,800 | $3,511,216 |
Key assumptions.
Net profit (or loss) by year, use of funds.
START-UP REQUIREMENTS
Start-up Expenses
Stationery etc. $50
Brochures $450
Insurance $100
Research and development $400
Expensed equipment $1,100
TOTAL START-UP EXPENSES $3,000
The two co-owners will each contribute $25,000, for a total startup of $50,000.
The plan depends on $4.1 million investment in the first month.
2020 | 2021 | 2022 | |
---|---|---|---|
Revenue | $12,012,000 | $37,514,400 | |
Direct Costs | $6,437,760 | $19,702,838 | |
Gross Margin | $5,574,240 | $17,811,562 | |
Gross Margin % | 46% | 47% | |
Operating Expenses | |||
Salaries & Wages | $180,000 | $1,466,200 | $3,348,424 |
Employee Related Expenses | $36,000 | $293,240 | $669,685 |
Sales and marketing | $300,000 | $3,000,000 | $6,000,000 |
Research and Development | $120,000 | $120,000 | $120,000 |
Rent | $240,000 | $240,000 | $240,000 |
Utilities | $60,000 | $60,000 | $60,000 |
Telephone | $28,800 | $28,800 | $28,800 |
Insurance | $144,000 | $144,000 | $144,000 |
Legal | $60,000 | $60,000 | $60,000 |
Equipment Upkeep | $108,000 | $108,000 | $108,000 |
office Supplies | $10,800 | $10,800 | $10,800 |
Total Operating Expenses | $1,287,600 | $5,531,040 | $10,789,709 |
Operating Income | ($1,287,600) | $43,200 | $7,021,853 |
Interest Incurred | |||
Depreciation and Amortization | $309,400 | $369,400 | $369,400 |
Gain or Loss from Sale of Assets | |||
Income Taxes | $0 | $0 | $0 |
Total Expenses | $1,597,000 | $12,338,200 | $30,861,947 |
Net Profit | ($1,597,000) | ($326,200) | $6,652,453 |
Net Profit/Sales | (3%) | 18% |
Starting Balances | 2020 | 2021 | 2022 | |
---|---|---|---|---|
Cash | $1,235,990 | $228,946 | $4,932,050 | |
Accounts Receivable | $1,921,920 | $6,002,304 | ||
Inventory | ||||
Other Current Assets | ||||
Total Current Assets | $1,235,990 | $2,150,866 | $10,934,354 | |
Long-Term Assets | $47,000 | $1,847,000 | $1,847,000 | $1,847,000 |
Accumulated Depreciation | ($309,400) | ($678,800) | ($1,048,200) | |
Total Long-Term Assets | $47,000 | $1,537,600 | $1,168,200 | $798,800 |
Total Assets | $47,000 | $2,773,590 | $3,319,066 | $11,733,154 |
Accounts Payable | $213,590 | $1,085,266 | $2,846,901 | |
Income Taxes Payable | $0 | $0 | $0 | |
Sales Taxes Payable | $0 | $0 | ||
Short-Term Debt | ||||
Prepaid Revenue | ||||
Total Current Liabilities | $213,590 | $1,085,266 | $2,846,901 | |
Long-Term Debt | ||||
Long-Term Liabilities | ||||
Total Liabilities | $213,590 | $1,085,266 | $2,846,901 | |
Paid-In Capital | $50,000 | $4,160,000 | $4,160,000 | $4,160,000 |
Retained Earnings | ($3,000) | ($3,000) | ($1,600,000) | ($1,926,200) |
Earnings | ($1,597,000) | ($326,200) | $6,652,453 | |
Total Owner’s Equity | $47,000 | $2,560,000 | $2,233,800 | $8,886,253 |
Total Liabilities & Equity | $47,000 | $2,773,590 | $3,319,066 | $11,733,154 |
2020 | 2021 | 2022 | |
---|---|---|---|
Net Cash Flow from Operations | |||
Net Profit | ($1,597,000) | ($326,200) | $6,652,453 |
Depreciation & Amortization | $309,400 | $369,400 | $369,400 |
Change in Accounts Receivable | ($1,921,920) | ($4,080,384) | |
Change in Inventory | |||
Change in Accounts Payable | $213,590 | $871,676 | $1,761,635 |
Change in Income Tax Payable | $0 | $0 | $0 |
Change in Sales Tax Payable | $0 | $0 | |
Change in Prepaid Revenue | |||
Net Cash Flow from Operations | ($1,074,010) | ($1,007,044) | $4,703,104 |
Investing & Financing | |||
Assets Purchased or Sold | ($1,800,000) | ||
Net Cash from Investing | ($1,800,000) | ||
Investments Received | $4,110,000 | ||
Dividends & Distributions | |||
Change in Short-Term Debt | |||
Change in Long-Term Debt | |||
Net Cash from Financing | $4,110,000 | ||
Cash at Beginning of Period | $0 | $1,235,990 | $228,946 |
Net Change in Cash | $1,235,990 | ($1,007,044) | $4,703,104 |
Cash at End of Period | $1,235,990 | $228,946 | $4,932,050 |
Fill-in-the-blanks and automatic financials make it easy.
No thanks, I prefer writing 40-page documents.
Discover the world’s #1 plan building software
July 6, 2023
Adam Hoeksema
Welcome to the ever-evolving world of ecommerce—a space where countless businesses are launching every day. If you've landed here, we're guessing you too are gearing up to start your own ecom business. Yet, entering ecommerce is not just about setting up a website and listing products—it involves a robust plan that encompasses every aspect from customer acquisition to cash flow forecasting. That's why we've crafted this comprehensive guide. This Ecommerce Business Plan Guide, complete with a sample business plan, should help you check this project off the list.
Although we focus on ecommerce financial models , we know that some of our clients also need a full business plan, so I decided to take a deep dive into the topic. I plan to cover:
How to analyze the competition in ecommerce, how to estimate customer acquisition costs in ecommerce.
With that as our guide, let’s dive in!
It might feel like writing a business plan is a waste of time, and honestly, writing a 40 page plan probably is a waste of time. So why write a business plan? I like to say that you write a business plan primarily because the people with the money (the lenders and investors) are asking for your business plan and projections.
Although I think a business plan could be a good exercise for any ecommerce startup, I know the real impetus for writing a business plan is likely the fact that your potential investors or lenders are asking for one.
I don’t think your business plan needs to be a 100 page dissertation, our ecommerce business plan example is roughly 10 pages. We include the following sections:
We suggest the following business plan sections for your ecommerce business plan:
Analyzing the market for an ecommerce product is a vital step in any business plan. It gives you a better understanding of your potential customers, competitors, and overall market dynamics. Here's a step-by-step guide to help you do this effectively:
I like to use Google Keyword Planner Tool to see how many people are searching for keywords related to the product I plan to sell as a quick and free way to estimate the market size. For example, let’s assume that we are selling a yoga mat. According to Google Keyword Planner Tool there are roughly 90,000 monthly searches for that keyword.
To put some additional rough math to the opportunity, the first organic search result will often get roughly 40% of the clicks, and a solid ecommerce site will have a 3% conversion rate of visit to purchase. So if you ranked first and received roughly 36,000 clicks with a 3% conversion rate you could sell 1,080 mats per month.
Read More: How to Write a Business Plan Competitor Analysis
I like to suggest using Google Trends to see trends in popularity in your market. If we stick with our yoga mat example we can see the following seasonal trends and trend over the last 5 years for the search term yoga mat.
Each of these steps will provide valuable insights that can shape your ecommerce product's marketing strategy, positioning, pricing, and much more. Remember, market analysis is an ongoing process—it needs to be repeated periodically as markets evolve over time.
There are a couple of tools that I like to use when analyzing the competition in ecommerce.
We can also see what keywords are sending the most traffic to that page below where I have highlighted the monthly organic traffic estimate for each keyword.
I like to use Google Keyword Planner Tool to estimate customer acquisition costs as well. As we saw with the Yoga Mat example below the average cost per click to advertise for that keyword was between $0.39 cents and $3.13.
Again if we stick with a 3% conversion rate and assume 50 cents per click that means you are likely to spend roughly $16 to acquire one customer. Not a whole lot of room for margin in this business right? In this case you would need to hope that you can sell multiple products to the same customer over time.
Your customer acquisition costs will be a fundamental assumption in your financial model. Let’s dive into that next.
Just like in any industry, the ecommerce business has its own unique factors that impact financial projections, such as online traffic, conversion rates, and customer acquisition costs. Utilizing an ecommerce financial projection template can simplify the process and increase your confidence. Creating accurate financial projections goes beyond showcasing your ecommerce venture's ability to generate sales; it's about illustrating the financial roadmap to profitability and the realization of your online business goals. To develop precise projections, consider the following key steps:
While financial projections are a critical component of your ecommerce business plan, seek guidance from experienced professionals in the ecommerce industry. Adapt your projections based on real-world insights, leverage industry resources, and stay informed about digital marketing trends and evolving consumer behavior to ensure your financial plan aligns with your goals and positions your ecommerce venture for long-term success.
Explore our E-commerce Business Plan, presented below. If you prefer, you can access a downloadable Google Doc version of this bar business plan template, allowing you to personalize and tailor it to your specific needs. Additionally, a helpful video walkthrough is available, guiding you through the process of customizing the business plan to perfectly align with your unique Ecommerce business.
Executive Summary:
Marketing and Sales Strategy
Operations Plan
Financial Projections
Our ecommerce store, "Eco-Friendly Fashion," aims to provide consumers with stylish and environmentally-friendly clothing options.
Our target customer is the eco-conscious, fashion-forward individual who is looking for sustainable alternatives to fast fashion.
The ecommerce market is growing rapidly, and there is a growing demand for sustainable fashion products. We believe there is a gap in the market for an ecommerce store that offers a wide range of eco-friendly clothing options at affordable prices. Our unique selling proposition is to offer high-quality, stylish clothing that is also environmentally friendly, at a price that is accessible to our target customer.
We plan to launch with a product line of 50 items, including t-shirts, hoodies, and dresses, made from organic cotton and recycled materials. Our products will be manufactured in fair trade factories, ensuring ethical labor practices. Our initial funding will come from personal investments and a small business loan. Our financial projections show that we will break even in the third year of operation and achieve a profit by the fourth year.
Eco-Friendly Fashion is a newly established ecommerce store that will offer a wide range of eco-friendly clothing options for both men and women. The company was founded by two friends, Jane Doe and John Doe, who share a passion for sustainability and fashion. Jane has a background in fashion design and John has experience in ecommerce and marketing.
Eco-Friendly Fashion is a limited liability company (LLC) registered in the state of California. Our team also includes a product sourcing specialist and a freelance graphic designer. Our office and warehouse are located in Los Angeles, CA.
The global ecommerce market is expected to reach $4.9 trillion by 2021, with a significant portion of this growth coming from the fashion industry. Consumers are increasingly turning to ecommerce for their fashion purchases, and there is a growing demand for sustainable fashion products.
Our target customer is the eco-conscious, fashion-forward individual, aged 18-35, with a moderate to high income. This demographic is highly concerned about the environmental impact of their clothing choices and is willing to pay a premium for sustainable fashion options.
Competitors in the eco-friendly fashion market include established brands like Patagonia and smaller, niche brands like Tentree. However, these brands tend to focus on outdoor and athletic wear, rather than everyday fashion, and their products can be expensive. Our competitors in the sustainable everyday fashion market include companies like Reformation and Everlane, but these brands have limited product offerings and their products can also be expensive.
Our marketing and sales strategies will focus on leveraging social media, influencer marketing, and targeted online advertising to reach our target customer. We will also attend sustainable fashion trade shows and events to network and showcase our brand.
Eco-Friendly Fashion will launch with a product line of 50 items, including t-shirts, hoodies, and dresses, made from organic cotton and recycled materials. Our products will be manufactured in fair trade factories, ensuring ethical labor practices. Our products will be designed in-house, with a focus on creating stylish, on-trend pieces that are also environmentally friendly.
Our pricing strategy will be to offer high-quality, stylish clothing at a price that is accessible to our target customer. Our products will be priced slightly higher than fast fashion options, but lower than sustainable fashion competitors like Reformation and Everlane.
We will continuously expand our product line and source new materials and manufacturing partners to ensure we are always offering the latest in sustainable fashion. In addition to our clothing line, we will also offer a recycling program for customers to trade in their old clothing for store credit. This will further demonstrate our commitment to sustainability and encourage customers to make more sustainable fashion choices.
Our plan to grow our ecommerce business and reach our financial targets will follow a 5 pronged marketing approach in order to acquire customers.
Brand Awareness:
Content Marketing:
Email Marketing:
Paid Advertising:
Referral Program:
Eco-Friendly Fashion will operate as an online ecommerce store, with all sales taking place through our website. Our website will feature a user-friendly interface, detailed product descriptions, and multiple payment options. We will also offer free shipping on all orders within the United States, with the option for international shipping at an additional cost.
Our fulfillment and delivery strategies will include partnerships with established logistics companies to ensure efficient and cost-effective shipping. We will also implement a comprehensive returns and exchanges policy to ensure customer satisfaction.
Our ecommerce platform will be powered by Shopify, which offers a range of tools and integrations to manage our website, inventory, and customer data. We will also use a customer relationship management (CRM) system to track customer interactions and improve our marketing and sales strategies.
Our start-up costs will include the cost of product development and manufacturing, website development, marketing, and rent for our office and warehouse. Our initial funding will come from personal investments and a small business loan.
Our financial projections show that we will achieve $75,000 in sales in the first year, increasing to $500,000 in the second year and $1 million in the third year. Our expenses will include product manufacturing, marketing, salaries, and other operating costs. Our projections show that we will break even in the third year of operation and achieve a profit by the fourth year.
To minimize risk, we will continuously monitor our financial performance and adjust our strategies as needed. We will also implement a thorough risk management plan, including carrying appropriate insurance coverage and implementing strong data security measures to protect our customer information.
All of the unique financial projections you see below were generated using ProjectionHub’s Ecommerce financial projection template . Use PH20BP to enjoy a 20% discount on the template.
Eco-Friendly Fashion is poised to fill a gap in the sustainable fashion market, offering a wide range of stylish and environmentally friendly clothing options at affordable prices. With a growing demand for sustainable fashion and our commitment to ethical and sustainable business practices, we are confident in our ability to succeed in the competitive ecommerce market.
Our team is dedicated to offering the highest quality products and customer service, and we are excited to bring our vision of sustainable fashion to life. Our next steps include finalizing our product line and manufacturing partnerships, launching our website, and beginning our marketing and sales efforts.
To start an ecommerce business, you'll need to identify your target market and products, create a business plan, set up an online store or website, source or create products, establish secure payment and shipping methods, and implement marketing strategies to drive traffic and sales.
Popular ecommerce platforms include Shopify, WooCommerce, Magento, and BigCommerce. Consider factors such as ease of use, customization options, scalability, pricing, and integration with other tools or marketplaces when choosing the right platform for your business.
You can drive traffic to your ecommerce website through various strategies, including search engine optimization (SEO), social media marketing, content marketing, influencer partnerships, email marketing, paid advertising, and utilizing marketplace platforms such as Amazon or Etsy.
Essential elements for product descriptions in ecommerce include clear and concise product titles, detailed descriptions highlighting key features and benefits, high-quality product images, pricing information, sizing or specifications, and customer reviews or testimonials, if available.
To optimize the checkout process, streamline the steps involved, offer guest checkout options, provide multiple payment methods, ensure security and trust indicators, display shipping options and costs upfront, minimize form fields, and offer incentives such as discounts or free shipping for completing a purchase.
Adam is the Co-founder of ProjectionHub which helps entrepreneurs create financial projections for potential investors, lenders and internal business planning. Since 2012, over 50,000 entrepreneurs from around the world have used ProjectionHub to help create financial projections.
8 ways to enhance your chances of getting approved for an sba loan.
Learn practical steps to increase your SBA loan approval odds. This guide offers 8 straightforward strategies from an experienced SBA loan officer.
Start your SBA loan application with confidence using ProjectionHub's comprehensive, free SBA Loan Application Checklist. Discover essential tips and resources from experienced professionals to streamline your loan process and enhance your approval chances.
Self Storage facilities seem to be popping up all over the place recently and there's no slow down in sight. Follow this step by step to understand the basics of how to get your self storage business started, how much it will cost, and how much you stand to make!
Writing a business plan is a crucial step in starting an ecommerce business. Not only does it provide structure and guidance for the future, but it also helps to create funding opportunities and attract potential investors. For aspiring ecommerce owners, having access to a sample ecommerce business plan can be especially helpful in providing direction and gaining insight into how to draft their own ecommerce business plan.
Download our Ultimate Ecommerce Business Plan Template
Having a thorough business plan in place is critical for any successful ecommerce venture. It will serve as the foundation for your operations, setting out the goals and objectives that will help guide your decisions and actions. A well-written business plan can give you clarity on realistic financial projections and help you secure financing from lenders or investors. An ecommerce business plan example can be a great resource to draw upon when creating your own plan, making sure that all the key components are included in your document.
The ecommerce business plan sample below will give you an idea of what one should look like. It is not as comprehensive and successful in raising capital for your ecommerce business as Growthink’s Ultimate Ecommerce Business Plan Template , but it can help you write an ecommerce business plan of your own.
Table of contents, executive summary, company overview, industry analysis, customer analysis, competitive analysis, marketing plan, operations plan, management team, financial plan.
Welcome to ClickCart Emporium, your new go-to ecommerce destination based in the vibrant city of Oklahoma City, OK. Our mission is to revolutionize the local ecommerce landscape by providing an unparalleled online shopping experience. With our comprehensive suite of services, we cater to a wide range of customer needs, ensuring secure payment processing, timely delivery, and a user-friendly online retail platform. Our dedication to excellence and our commitment to the Oklahoma City community drive us to serve you better, making online shopping convenient, secure, and enjoyable.
Our confidence in becoming the leading ecommerce platform in Oklahoma City is anchored in our founder’s previous success in the ecommerce industry, combined with our unwavering commitment to superior service. Since our launch on January 4, 2024, ClickCart Emporium has achieved significant milestones, including the development of a distinctive brand identity, securing an ideal operational base, and laying a strong foundation for our future growth. These accomplishments reflect our dedication to excellence and our strategic approach to becoming your preferred online shopping destination.
The Ecommerce industry in the United States, currently valued at over $600 billion, is on an exponential growth trajectory, with projections estimating its value to reach $1 trillion by 2025. This growth is driven by increased internet access, rising disposable incomes, and the proliferation of digital devices, alongside consumer preferences shifting towards online shopping for its convenience and variety. ClickCart Emporium is poised to leverage these trends, offering exceptional customer service and a diverse product range, positioning us to carve out a successful niche within this competitive and rapidly expanding market, especially in Oklahoma City, OK.
ClickCart Emporium targets a diverse customer base in Oklahoma City, focusing on busy professionals, parents, elderly shoppers, tech-savvy millennials, Gen Z, and small business owners. Our platform caters to their varying needs with a wide range of products, convenient and reliable delivery options, and an easy-to-navigate interface. By tailoring our marketing strategies, especially through social media and influencer partnerships, we aim to engage these segments effectively, ensuring a seamless and efficient online shopping experience that meets their everyday needs and preferences.
Our main competitors include Liquidfish, 1stPride, and Plenty of Pixels, each offering unique digital solutions targeting different customer segments in Oklahoma City, OK. Despite their strengths, ClickCart Emporium differentiates itself through superior customer service, an intuitive shopping platform, and leveraging cutting-edge technology to offer an expansive product range. Our focus on competitive pricing, exclusive deals, and personalized support ensures a seamless shopping experience, setting us apart as a leader in the ecommerce market.
At ClickCart Emporium, we offer an integrated suite of ecommerce services, including a user-friendly online retail platform, secure payment processing, and efficient logistics and fulfillment services, all designed to empower businesses and delight consumers. Our competitive pricing strategy and comprehensive service offerings are tailored to meet the diverse needs of our customers in Oklahoma City, OK. Our promotional strategy is multifaceted, encompassing SEO, PPC, social media marketing, email marketing, community engagement, and influencer partnerships. These efforts aim to enhance our visibility, drive traffic, and foster a strong community around our brand, ensuring ClickCart Emporium becomes a household name in the local ecommerce scene.
To ensure ClickCart Emporium’s success, our operations focus on maintaining a user-friendly website, real-time inventory management, efficient order processing, and seamless coordination with shipping partners. We prioritize customer support across multiple channels and implement secure payment systems to enhance the shopping experience. Our operational strategy includes regular analysis of customer data and market trends, enabling us to refine our product offerings and marketing strategies continually. By focusing on these key operational processes and milestones, we aim to achieve operational excellence and sustain our growth trajectory.
Our management team combines expertise in ecommerce, digital marketing, logistics, and customer service, driving ClickCart Emporium towards achieving its mission. With a solid track record in the industry and a shared vision for innovation and excellence, our team is committed to providing the best online shopping experience in Oklahoma City, ensuring that ClickCart Emporium stands out in the competitive ecommerce landscape.
Welcome to ClickCart Emporium, a new Ecommerce venture based right here in Oklahoma City, OK. As a local ecommerce business, we noticed a gap in the market for high-quality online shopping experiences tailored to our community’s needs. Recognizing this, we set out to create an ecommerce platform that not only serves Oklahoma City but also sets the standard for what local online shopping should look like.
At ClickCart Emporium, we offer a comprehensive suite of ecommerce solutions. Our primary offering is an online retail platform designed to bring the convenience of shopping online to our local customers, providing them with a wide range of products at their fingertips. To complement this, we offer payment processing services, ensuring a seamless transaction experience. Recognizing the importance of timely delivery, we also specialize in ecommerce logistics and fulfillment. These services work in tandem to provide a smooth and enjoyable shopping experience from browsing to delivery.
Our operations are deeply rooted in Oklahoma City, OK. This strategic location allows us to stay closely connected with our community and understand the unique needs of our customers better. Serving the Oklahoma City area is not just a business decision; it’s a commitment to enriching our local economy and providing value to our neighbors.
ClickCart Emporium is poised for success for several reasons. Our founder brings valuable experience from previously running a successful ecommerce business, imparting a wealth of knowledge and industry insights that are instrumental to our operations. Moreover, our commitment to delivering superior ecommerce services positions us ahead of the competition, ensuring that we meet and exceed the expectations of our customers.
Since our inception on January 4, 2024, ClickCart Emporium has made significant strides as a Limited Liability Company. We’ve developed a unique and recognizable brand, starting with the design of our logo and the creative development of our company name. Additionally, we secured a great location that supports our logistics and fulfillment operations, laying a solid foundation for our business. These accomplishments, though early, are indicative of our dedication to building a successful and sustainable ecommerce platform for Oklahoma City.
The Ecommerce industry in the United States is currently valued at over $600 billion, making it one of the largest and fastest-growing sectors in the country. With the rise of online shopping and the convenience it offers consumers, Ecommerce sales have been steadily increasing year over year. Experts predict that the market will continue to grow at a rapid pace, reaching over $1 trillion by 2025.
One of the key trends in the Ecommerce industry is the shift towards mobile shopping. With more and more consumers using their smartphones and tablets to make purchases online, businesses that provide a seamless mobile shopping experience are poised for success. ClickCart Emporium, being a new Ecommerce platform, can take advantage of this trend by ensuring their website is mobile-friendly and easy to navigate on all devices.
Another trend in the Ecommerce industry is the increasing demand for personalized shopping experiences. Consumers are looking for tailored product recommendations, exclusive deals, and customized shopping features. ClickCart Emporium can set itself apart from competitors by offering personalized recommendations based on customer preferences and purchase history, creating a unique and engaging shopping experience for its customers in Oklahoma City, OK.
Below is a description of our target customers and their core needs.
ClickCart Emporium will primarily target local residents seeking a convenient and efficient online shopping experience. This segment includes busy professionals, parents needing to juggle work and family commitments, and elderly individuals who prefer the safety and comfort of home shopping. The focus will be on offering a wide range of products tailored to their everyday needs, from groceries to household essentials.
The business will also cater to tech-savvy millennials and Gen Z consumers who are always on the lookout for the latest trends and unique products. These younger customers value fast, reliable delivery and an easy-to-navigate website or app interface. ClickCart Emporium will tailor its marketing strategies to engage this demographic through social media channels and influencer partnerships.
In addition to the above, ClickCart Emporium will target small business owners in Oklahoma City who require bulk purchases for their operations. This segment is in need of a reliable partner that can provide a variety of products at competitive prices with the convenience of scheduled deliveries. The platform will offer business accounts with features such as order tracking, purchase history, and volume discounts.
ClickCart Emporium steps into the market to fulfill the growing demand for high-quality eCommerce services among residents who seek the convenience of online shopping. Customers expect a seamless shopping experience that combines ease of use with a wide selection of products. By focusing on user experience and inventory diversity, ClickCart Emporium meets these expectations head-on, ensuring that every visit to the site is both enjoyable and fruitful.
In addition to providing an extensive range of products, ClickCart Emporium understands the importance of reliable customer service and fast, accurate delivery. Shoppers value quick responses to inquiries and appreciate the peace of mind that comes with knowing their purchases will arrive on time and in perfect condition. This level of service builds trust and loyalty, encouraging repeat visits and long-term relationships with customers.
Moreover, ClickCart Emporium recognizes the significance of offering competitive prices without compromising on quality. Consumers are always on the lookout for the best deals online, and by ensuring that prices are attractive, ClickCart Emporium positions itself as a go-to destination for savvy shoppers. This approach not only satisfies the need for affordability but also reinforces the value proposition of shopping with ClickCart Emporium.
ClickCart Emporium’s competitors include the following companies:
Liquidfish specializes in offering comprehensive digital solutions including website development, digital marketing, and custom software development. Their services are tailored towards businesses looking to establish or enhance their online presence. Price points for their services vary depending on the complexity and scope of the project, making them accessible to a wide range of businesses.
While specific revenue figures are not publicly available, Liquidfish is recognized for its robust client portfolio across various sectors, indicating a healthy financial standing. The company operates primarily from its headquarters in Oklahoma City, OK, but serves clients across the United States. This broad geographic coverage is a key strength, as it allows Liquidfish to cater to a diverse client base.
Key strengths of Liquidfish include its comprehensive service offering and its ability to deliver customized digital solutions. However, its primary weakness lies in the highly competitive market of digital services, where differentiation can be challenging.
1stPride offers a range of ecommerce services, focusing on website design, online marketing, and SEO optimization. Their services are designed to help businesses improve their online sales and visibility. The company adopts a competitive pricing strategy, which makes it an attractive option for small to medium-sized businesses.
1stPride operates mainly within the Oklahoma City area, targeting local businesses aiming to expand their online footprint. Although they have a strong local presence, their geographical reach is more limited compared to other competitors. This focus on a local customer base both serves as a strength, providing personalized services, and a weakness, limiting potential market expansion.
Their key strength lies in their local market knowledge and personalized customer service. However, their limited geographical reach and the challenge of scaling their services can be seen as weaknesses.
Plenty of Pixels specializes in website design and development, offering customizable packages to meet the needs of various businesses. Their pricing model is transparent, with clear tiers based on the complexity and features of the website, catering to both startups and established businesses. The company prides itself on its efficient project delivery and post-launch support.
Although primarily based in Oklahoma City, OK, Plenty of Pixels serves clients nationwide, leveraging digital communication tools to manage projects remotely. This allows them to tap into a larger market, despite their physical location. Their ability to serve clients across the country is a significant strength, broadening their potential customer base.
The key strengths of Plenty of Pixels include their flexible pricing model and nationwide service coverage. However, their focus on website services means they might not offer as comprehensive a digital solution set as some competitors, which could be seen as a weakness in a market that favors full-service agencies.
At ClickCart Emporium, we pride ourselves on providing unparalleled ecommerce services that set us apart from our competition. Our secret lies in our commitment to understanding the unique needs of our customers in Oklahoma City, ensuring that we offer personalized shopping experiences tailored to their preferences. We leverage advanced technology to streamline the shopping process, making it faster, more intuitive, and user-friendly. This approach not only enhances customer satisfaction but also fosters loyalty, as shoppers know they can expect a seamless experience every time they visit our platform.
Beyond merely offering a wide range of products, we differentiate ourselves by integrating cutting-edge features such as AI-powered recommendations and real-time inventory updates, which significantly improve the shopping experience. Our customer service is second to none, providing round-the-clock support to address any queries or concerns promptly. Additionally, our logistics and delivery system is optimized for efficiency, ensuring that orders are processed and delivered faster than any other service in the area. This comprehensive approach to ecommerce positions us not just as a shopping platform, but as a reliable partner for our customers, making their online shopping journey enjoyable and hassle-free.
Our marketing plan, included below, details our products/services, pricing and promotions plan.
ClickCart Emporium emerges as a comprehensive solution for both businesses and consumers, offering a suite of services designed to streamline the online shopping experience. At the heart of its offerings is an online retail platform that serves as a marketplace for a wide range of products. This platform connects sellers with buyers, facilitating easy access to an array of items from the comfort of one’s home. The average selling price for products on this platform varies widely depending on the category and value of the items, but ClickCart Emporium ensures competitive pricing to attract a broad customer base.
In addition to facilitating sales through its online retail platform, ClickCart Emporium offers payment processing services. This crucial service ensures secure and efficient transactions between buyers and sellers, employing state-of-the-art encryption and security measures to protect all parties involved. The company charges a nominal fee for these services, typically a percentage of the transaction value. This fee averages around 2.9% + 30 cents per transaction, aligning with industry standards and ensuring that sellers can affordably access secure payment processing capabilities.
Understanding the importance of logistics in e-commerce, ClickCart Emporium also provides e-commerce logistics and fulfillment services. This comprehensive service covers everything from warehousing and inventory management to order fulfillment and shipping. By handling these logistical aspects, ClickCart Emporium enables sellers to focus on their products and sales, rather than the complexities of distribution. Pricing for these services is tailored to the specific needs of each seller, but businesses can expect competitive rates that reflect the efficiency and value of the logistics solutions provided.
Overall, ClickCart Emporium positions itself as a key player in the e-commerce sector by offering an integrated platform that not only connects buyers and sellers but also provides essential services like payment processing and logistics. Through competitive pricing and a commitment to quality, ClickCart Emporium aims to foster a vibrant online marketplace that meets the needs of a diverse customer base.
ClickCart Emporium embarks on an ambitious journey to captivate the hearts and wallets of customers in Oklahoma City, OK, with a blend of innovative and traditional promotional methods tailored to the digital age. Recognizing the power of online presence, the emporium will leverage online marketing as its spearhead strategy. Through this approach, ClickCart Emporium expects to build a robust digital footprint that resonates with its target audience, driving both traffic and sales.
Diving deeper into online marketing, the company will utilize social media platforms extensively. Platforms such as Facebook, Instagram, and Twitter will become arenas where ClickCart Emporium engages with its audience. Regular posts, interactive stories, and targeted ads will serve to inform, entertain, and persuade potential customers. Moreover, the emporium will harness the power of influencer marketing, partnering with local influencers in Oklahoma City to tap into their followers and gain credibility quickly.
Email marketing will also play a crucial role in ClickCart Emporium’s promotional strategy. By collecting emails from potential customers through sign-ups and promotions, the emporium will send out newsletters, exclusive offers, and updates about new products or services. This personalized approach expects to not only drive sales but also foster a sense of community among its customers.
Search Engine Optimization (SEO) will ensure that ClickCart Emporium appears at the top of search results when potential customers look for related products or services online. By optimizing its website content with relevant keywords, the emporium expects to attract more organic traffic, thereby reducing its reliance on paid advertising in the long run.
ClickCart Emporium will not limit itself to online methods alone. Local events and sponsorships will serve as an excellent opportunity to increase brand visibility and engagement within the community. Participating in or sponsoring local events, fairs, and festivals will allow the emporium to showcase its brand and products in a more personal and interactive setting.
Loyalty programs will be introduced to reward returning customers, encouraging repeat business and word-of-mouth referrals. These programs will offer discounts, special offers, and early access to new products, cultivating a loyal customer base that feels valued and appreciated.
In conclusion, ClickCart Emporium will employ a multifaceted promotional strategy that combines the reach and efficiency of online marketing with the personal touch of local engagement and customer loyalty programs. Through these efforts, the emporium expects to attract and retain customers, setting a strong foundation for growth in Oklahoma City, OK.
Our Operations Plan details:
To ensure the success of ClickCart Emporium, there are several key day-to-day operational processes that we will perform.
ClickCart Emporium expects to complete the following milestones in the coming months in order to ensure its success:
ClickCart Emporium management team, which includes the following members, has the experience and expertise to successfully execute on our business plan:
Lily Young brings a wealth of experience to ClickCart Emporium, having previously led an ecommerce business to notable success. Her entrepreneurial spirit and deep understanding of digital marketplaces equip her with the unique insights needed to navigate the complex landscape of online retail. Lily’s leadership style is characterized by a focus on innovation, customer satisfaction, and operational efficiency. Her track record of building cohesive teams and fostering a culture of excellence makes her an invaluable asset to ClickCart Emporium. Under Lily’s guidance, the company is poised to achieve its goals and make a lasting impact in the ecommerce arena.
ClickCart Emporium’s financial strategy is designed to support our growth objectives, ensuring we have the necessary resources to expand our operations, enhance our service offerings, and achieve our goal of becoming the leading ecommerce platform in Oklahoma City. Our plan outlines the investment needed to fuel our strategic initiatives, focusing on technology upgrades, marketing efforts, and operational efficiencies to drive revenue growth and profitability.
Balance sheet.
[insert balance sheet]
[insert income statement]
[insert cash flow statement]
Download our Ecommerce Business Plan PDF here. This is a free ecommerce business plan example to help you get started on your own ecommerce plan.
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If you want to start an online business or expand your current ecommerce business, you need a solid business plan.
A successful ecommerce business plan will accomplish several key objectives. First, it will help you create business goals for your online business and give you a roadmap to follow to reach them. It will also help you develop the right sales strategies to attain your goals. For example, by understanding market trends, the strengths and weaknesses of other ecommerce businesses, and the demographic and psychographic needs of your target audience, you can craft a better business strategy and marketing strategies to reach your target customers.
You can download our Ecommerce Business Plan Template (including a full, customizable financial model) to your computer here.
The following Ecommerce business plan template gives you the key elements to include in a winning business plan for an ecommerce startup or an existing ecommerce business.
I. executive summary, business overview.
[Company Name], headquartered at [insert location here] is a new eco-friendly baby supplies e-commerce website that seeks to offer an alternative resource to the mass-market of baby care items. It will feature products that specialize in all-natural, environmentally friendly baby, feminine and maternity items.
[Company Name] will sell an exclusive collection of baby care items with a focus on eco-friendly and environmentally safe products. Product offerings also include an array of feminine and maternity items. It is a priority of [Company Name] to offer only the best products with all-natural ingredients and materials.
[Company Name] is also dedicated to providing educational information on baby care, pregnancy, and holistic lifestyles.
[Company Name]’s target market is comprised primarily of online consumers with a specific focus on moms and eco-friendly consumers.
The demographics of these potential customers are as follows:
[Company Name] is led by [Founder’s Name] who has been in the e-commerce business for 10 years. While [Founder] has never run an e-commerce portal himself, he was previously director of strategic development for an e-commerce site. As such [Founder] has an in-depth knowledge of the e-commerce business as well as the needs mothers, including the operations side (e.g., running day-to-day operations) and the business management side (e.g., staffing, marketing, etc.).
[Company Name] is uniquely qualified to succeed for the following reasons:
[Company Name] is seeking a total funding of $430,000 to launch its business. The capital will be used for funding capital expenditures, manpower costs, marketing expenses and working capital.
Specifically, these funds will be used as follows:
Top line projections over the next five years are as follows:
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
---|---|---|---|---|---|
Revenue | $731,250 | $2,687,401 | $5,358,945 | $7,650,990 | $10,229,809 |
Total Expenses | $960,000 | $2,472,423 | $4,438,003 | $5,792,613 | $7,105,296 |
EBITDA | ($228,750) | $214,978 | $920,943 | $1,858,377 | $3,124,513 |
Depreciation | $7,440 | $7,440 | $7,440 | $7,440 | $7,440 |
EBIT | ($236,190) | $207,538 | $913,503 | $1,850,937 | $3,117,073 |
Interest | $27,768 | $24,297 | $20,826 | $17,355 | $13,884 |
PreTax Income | ($263,958) | $183,241 | $892,677 | $1,833,582 | $3,103,189 |
Income Tax Expense | $0 | $0 | $284,186 | $641,754 | $1,086,116 |
Net Income | ($263,958) | $183,241 | $608,491 | $1,191,828 | $2,017,073 |
Average customers/day | 102 | 339 | 615 | 798 | 970 |
Number of orders | 36,563 | 122,155 | 221,444 | 287,415 | 349,355 |
Who is [company name].
[Company Name] headquartered at [insert location here] is an eco-friendly baby supplies website that seeks to offer an alternative resource to the mass-market of baby care items. Our goal is to shift consumer sentiment to a more eco-conscious attitude through education of eco-friendly baby care products and practices.
The website aims to increase accessibility to these products and lifestyle by creating a user-friendly portal that connects parents to a wide variety of manufacturers, small businesses and products that specialize in all-natural, environmentally friendly baby, feminine and maternity items. The website’s goal is to not only sell goods, but to build a community of parents and eco-friendly businesses in order to become the premier, trusted provider of online services and products in the green space.
[Company Name] was founded by [Founder’s Name]. While [Founder’s Name] has been in the e-commerce business for some time, it was in [month, date] that he decided to launch [Company Name]. With active memberships in the Real Diaper Industry Association, International Center for Traditional Childbearing, Doulas of North America, Real Diaper Association, Baby Carrier Industry Alliance and Baby wearers Institute, [Founder’s Name] has become well connected and respected in the industry, which makes him the ideal leader for the brand.
It was apparent to [Founder’s Name] that an unserved market need existed for the product.
After surveying the e-commerce landscape, [Founder’s Name] incorporated [Company Name] as an S-Corporation on [date of incorporation].
[Founder’s Name] has selected a technology director with project management experience in the development of e-commerce websites.
Since incorporation, the company has achieved the following milestones:
Below is [Company Name]’s initial product list. As you can see all items are classified under the following five main categories:
The website will feature a rotating display of featured and new products on its homepage as well as a searchable database. Products will be sent directly via manufacturer to client’s home.
[Company Name] will develop a website whose key elements will include the following:
The website will be built by an established development firm and designed by an accomplished web designer, with the process supervised by the company’s technology director. Where appropriate, existing software applications will be purchased to fill standard needs to keep costs down without sacrificing functionality and to avoid the problems associated with newly-developed software.
[Company Name]’s website will be available at all times, but customer service representatives, answering email requests, will only work 7 days a week, from 9AM to 6 PM.
Industry statistics & trends.
The following industry size facts and statistics bode well for [Company Name]. The E-Commerce industry will attract a larger customer market as more households purchase items online. Over the past five years, revenue is expected to increase at an annualized 13.4% to $526.6 billion. However, the looming threat of regulation may hamper sales, and heightened competition is projected to slow profit growth in the coming years.
Trends and drivers include:
Demographic profile of target market.
[Company Name] will primarily serve e-commerce customers. The demographics of these customers are as follows:
We will primarily target Consumer age groups that have the greatest exposure to the internet for work and leisure are most likely to shop online:
Direct and indirect competitors.
The following e-commerce sites are expected to be the key competitors for [Company Name] due to their current brand and resources:
Diapers.com is currently the largest online specialty retailer for baby products. Initially founded as 1800 DIAPERS, the company set out delivering consumables, such as diapers, wipes and formula, to parents with free 1-2 day shipping and a focus on customer service. Diapers.com expanded its selection into far-reaching baby categories, including clothes, car seats, strollers, and toys. Today, Diapers.com is the largest online retailer for everything baby.
Sister sites include Soap.com, BeautyBar.com, Wag.com and Yoyo.com. Amazon.com acquired Quidsi, Inc., which operates Diapers.com and Soap.com for $550 million.
Babies “R” Us is owned and operated by Toys”R”Us. Founded in 1948, as a toy and juvenile-products retailer, the company expanded into baby care products in 1996 with the launch of the first Babies “R” Us location. Babies“R”Us operates as a specialty baby products retailer and has grown to approximately 260 locations across the country since its first store opened. The stores offers new and expectant parents a broad assortment of products for newborns and infants, including cribs and furniture, car seats, strollers, formula, diapers, bedding, clothing and toys. Over 11 million moms have utilized the popular Babies“R”Us Registry.
Last year, Toys“R”Us, Inc. reported that its Internet sales grew 29.9% year-over-year to $782 million from $602 million, and the company announced plans to open a dedicated e-commerce fulfillment center in McCarran, NV.
[Company Name] enjoys several advantages over its competitors. These advantages include:
The Marketing Plan describes the type of brand [Company Name] seeks to create and the Company’s planned promotions and pricing strategies.
The [Company Name] brand will focus on the Company’s unique value proposition:
The Company’s promotions strategy to reach the target market of e-commerce customers includes:
We will contact family and baby magazines, family and life sections of newspapers, and television stations and send them a press release describing the opening and unique value proposition of [Company Name].
The Company will develop its website in such a manner as to direct as much traffic from search engines as possible. The original website designer will use knowledge of search engine optimization to orient the website’s content towards this end and begin a program of link exchange to move up the search engine rankings (particularly Google). Ongoing search engine optimization of this type will be executed by an experienced SEO firm contracted on a monthly basis.
Additionally, [Company Name] will use highly-focused, specific keywords to draw traffic to its website through text pay-per click advertising on Google Adwords and banner ads on other appropriate websites (brokered by Google or another ad placement company). Advertisements will be targeted at potential clients who will find our content-rich site to be a valid resource and applicable to their interests, rather than an interruption or distraction.
[Company Name] will publish a monthly email newsletter to tell customers about trends in motherhood, baby products and child care. Email addresses will be gathered from users who opt-in when using the website and the email newsletters will support the brand of the site as an expert in baby care. In addition, emails presenting exciting new offers or products may be sent as often as once a week to customers who have opted-in to keep them informed of the latest information on the website.
[Company Name]’s affiliate web program will allow other businesses and websites to earn commissions on products sold on the [Company Name] website by referring their site visitors to our website through links to the homepage or to specific products.
[Company Name] will initially advertise in family magazines and mom-focused websites and blogs in order to gain awareness.
[Company Name] pricing will be appropriate for the digital medium. That is, they will be priced lower than other big box retailers. The ecommerce store will carry products offered at a range of prices to allow even those with modest budgets to have options.
Functional roles.
In order to execute on [Company Name]’s business model, the Company needs to perform many functions including the following:
[Company Name] expects to achieve the following milestones in the following [] months:
Date | Milestone |
---|---|
[Date 1] | Finalize web development contract |
[Date 2] | Complete prototype design of website |
[Date 3] | Hire and train initial staff |
[Date 4] | Launch [Company Name]website |
[Date 5] | Reach break-even |
Management team members.
[Company Name] is led by [Founder’s Name] who has been in the e-commerce business for 10 years. While [Founder] has never run an e-commerce portal himself, he was director of strategic development for an e-commerce site devoted to baby products previously. As such [Founder] has an in-depth knowledge of the e-commerce business as well as the needs of mothers, including the operations side (e.g., running day-to-day operations) and the business management side (e.g., staffing, marketing, etc).
[Founder] graduated from the University of ABC where he majored in Business.
The technology director, [Tech Director Name], has 15 years of web development management experience. He has experience managing web development projects for e-commerce at for squidoo.com, creating an e-commerce portal much like that of [Company Name]. He received an MBA in Business Information Systems from XYZ College.
In order to launch the e-store, we need to hire the following personnel:
At a future date, the following staff will be added:
Revenue and cost drivers.
[Company Name]’s revenues will come from the sale of baby and feminine products.
The major costs for the company will be cost of goods, internet connection fees, and salaries of the staff. In the initial years, the company’s marketing spend will be high, as it establishes itself in the market.
[Company Name is seeking a total funding of $430,000 to launch its business. The capital will be used for funding capital expenditures, manpower costs, marketing expenses and working capital.
Below please find the key assumptions that went into the financial forecast and a summary of the financial projections over the next five years.
Number of customers per day | |
---|---|
Year 1 | 40 |
Year 2 | 60 |
Year 3 | 80 |
Year 4 | 100 |
Year 5 | 120 |
Average order price | $32 |
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | ||
---|---|---|---|---|---|---|
Revenues | ||||||
Product/Service A | $151,200 | $333,396 | $367,569 | $405,245 | $446,783 | |
Product/Service B | $100,800 | $222,264 | $245,046 | $270,163 | $297,855 | |
Total Revenues | $252,000 | $555,660 | $612,615 | $675,408 | $744,638 | |
Expenses & Costs | ||||||
Cost of goods sold | $57,960 | $122,245 | $122,523 | $128,328 | $134,035 | |
Lease | $60,000 | $61,500 | $63,038 | $64,613 | $66,229 | |
Marketing | $20,000 | $25,000 | $25,000 | $25,000 | $25,000 | |
Salaries | $133,890 | $204,030 | $224,943 | $236,190 | $248,000 | |
Other Expenses | $3,500 | $4,000 | $4,500 | $5,000 | $5,500 | |
Total Expenses & Costs | $271,850 | $412,775 | $435,504 | $454,131 | $473,263 | |
EBITDA | ($19,850) | $142,885 | $177,112 | $221,277 | $271,374 | |
Depreciation | $36,960 | $36,960 | $36,960 | $36,960 | $36,960 | |
EBIT | ($56,810) | $105,925 | $140,152 | $184,317 | $234,414 | |
Interest | $23,621 | $20,668 | $17,716 | $14,763 | $11,810 | |
PRETAX INCOME | ($80,431) | $85,257 | $122,436 | $169,554 | $222,604 | |
Net Operating Loss | ($80,431) | ($80,431) | $0 | $0 | $0 | |
Income Tax Expense | $0 | $1,689 | $42,853 | $59,344 | $77,911 | |
NET INCOME | ($80,431) | $83,568 | $79,583 | $110,210 | $144,693 | |
Net Profit Margin (%) | - | 15.00% | 13.00% | 16.30% | 19.40% |
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | ||
---|---|---|---|---|---|---|
ASSETS | ||||||
Cash | $16,710 | $90,188 | $158,957 | $258,570 | $392,389 | |
Accounts receivable | $0 | $0 | $0 | $0 | $0 | |
Inventory | $21,000 | $23,153 | $25,526 | $28,142 | $31,027 | |
Total Current Assets | $37,710 | $113,340 | $184,482 | $286,712 | $423,416 | |
Fixed assets | $246,450 | $246,450 | $246,450 | $246,450 | $246,450 | |
Depreciation | $36,960 | $73,920 | $110,880 | $147,840 | $184,800 | |
Net fixed assets | $209,490 | $172,530 | $135,570 | $98,610 | $61,650 | |
TOTAL ASSETS | $247,200 | $285,870 | $320,052 | $385,322 | $485,066 | |
LIABILITIES & EQUITY | ||||||
Debt | $317,971 | $272,546 | $227,122 | $181,698 | $136,273 | |
Accounts payable | $9,660 | $10,187 | $10,210 | $10,694 | $11,170 | |
Total Liabilities | $327,631 | $282,733 | $237,332 | $192,391 | $147,443 | |
Share Capital | $0 | $0 | $0 | $0 | $0 | |
Retained earnings | ($80,431) | $3,137 | $82,720 | $192,930 | $337,623 | |
Total Equity | ($80,431) | $3,137 | $82,720 | $192,930 | $337,623 | |
TOTAL LIABILITIES & EQUITY | $247,200 | $285,870 | $320,052 | $385,322 | $485,066 |
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
---|---|---|---|---|---|
CASH FLOW FROM OPERATIONS | |||||
Net Income (Loss) | ($80,431) | $83,568 | $79,583 | $110,210 | $144,693 |
Change in working capital | ($11,340) | ($1,625) | ($2,350) | ($2,133) | ($2,409) |
Depreciation | $36,960 | $36,960 | $36,960 | $36,960 | $36,960 |
Net Cash Flow from Operations | ($54,811) | $118,902 | $114,193 | $145,037 | $179,244 |
CASH FLOW FROM INVESTMENTS | |||||
Investment | ($246,450) | $0 | $0 | $0 | $0 |
Net Cash Flow from Investments | ($246,450) | $0 | $0 | $0 | $0 |
CASH FLOW FROM FINANCING | |||||
Cash from equity | $0 | $0 | $0 | $0 | $0 |
Cash from debt | $317,971 | ($45,424) | ($45,424) | ($45,424) | ($45,424) |
Net Cash Flow from Financing | $317,971 | ($45,424) | ($45,424) | ($45,424) | ($45,424) |
SUMMARY | |||||
Net Cash Flow | $16,710 | $73,478 | $68,769 | $99,613 | $133,819 |
Cash at Beginning of Period | $0 | $16,710 | $90,188 | $158,957 | $258,570 |
Cash at End of Period | $16,710 | $90,188 | $158,957 | $258,570 | $392,389 |
Use this ecommerce business plan PDF to get started on your own business plan.
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If you’ve got an exciting concept for an e-commerce venture, it’s crucial to develop a business plan tailored to your online store. This plan will play a pivotal role in ensuring that your vision has the necessary resources to thrive and generate profits. By crafting a comprehensive business plan for your online retail operation, you can effectively pinpoint your target audience, set clear monthly and quarterly sales targets, and significantly enhance the prospects of achieving long-term success in the e-commerce industry.
As a business plan writer and consultant , I’ve authored over 15,000 business plans for various enterprises, many of which have gone on to achieve substantial growth and success. In this article, I offer insights based on my experience and expertise in creating an e-commerce business plan.
An ecommerce business plan is a comprehensive document that outlines the goals, strategies, and financial projections of an online business. It serves as a roadmap for the business, guiding entrepreneurs in making informed decisions and attracting investors.
An executive summary serves as a succinct, one-to-two-page overview of your business, meticulously crafted to inform stakeholders about the essential elements of your comprehensive business plan. It’s a window into your business’s aspirations, strategies, and financial projections, providing a clear roadmap for decision-making and attracting potential investors.
An ecommerce business plan executive summary can look something like this:
Here’s a complete guide on how to write an effective executive summary with examples.
Business overview section beckons for meticulous attention to detail, as it showcases the very essence of your business – your product or service. It’s the stage upon which your offering takes center stage, captivating the audience with its unique value proposition and compelling features. Begin by painting a vivid overview of what you’re bringing to the market, piquing the interest of potential customers and investors alike.
A business overview of Pet Planet online store may look something like this:
Here are 14 profitable eCommerce business ideas you can start today!
Having established the foundation of your business and its purpose, it’s time to embark on a deeper exploration of your plan. The spotlight now falls upon the products and services that will form the cornerstone of your venture. Begin by meticulously listing each offering, accompanied by a clear explanation of its purpose. Address the fundamental question of ‘why’ – why have you chosen to offer these specific products and services ? What unique value do they bring to the market?
Once the products and services have been comprehensively described, it’s time to illuminate the pricing model that will govern your offerings. Assign a clear cost to each service, considering factors such as production costs, market demand, and competitive pricing. Determining pricing, especially for a startup, can be a complex endeavor. Fortunately, sales pricing calculators can serve as valuable allies in identifying the optimal pricing strategy .
A explain your offerings of smart home products may look something like this:
For your E-store business, download this ecommerce business plan template now.
A comprehensive market analysis serves as a compass, guiding your business through the intricate terrain of the marketplace. It begins with a deep understanding of your target audience, delving into their demographics, preferences, and purchasing behaviors. This knowledge empowers you to tailor your products, services, and marketing strategies to resonate with their needs and aspirations.
Here is how analyze the market in our ecommerce business plan.
How to Write Products and Services Section of Business Plan
You have a great business idea. We can help you turn it into a perfect business plan..
An ecommerce business’s marketing plan is its secret weapon, guiding it towards brand awareness, target audience reach , and enhanced sales and revenue. This plan revolves around positioning strategy, acquisition channels, and tools and technology. Positioning strategy determines how you will differentiate yourself in the market, while acquisition channels identify how your target audience discovers your business.
Finally, tools and technology harness the power of innovation to enhance your reach, automate tasks, and gain valuable insights into customer behavior. By crafting and implementing a comprehensive marketing plan , you can effectively build brand awareness, attract your target audience, and drive growth and profitability for your ecommerce venture.
How to Write the Marketing Plan in Ecommerce Business Plan?
Importance of an ecommerce business plan.
The significance of an ecommerce business plan cannot be overstated. It plays a pivotal role in:
Revenue projections can be determined by conducting market research, analyzing industry trends, evaluating your target market size, and considering your pricing strategy. Additionally, factors such as marketing efforts, customer acquisition rates, and competition should be taken into account.
Managing operating expenses effectively involves careful budgeting, identifying cost-saving opportunities, negotiating with suppliers, optimizing operational processes, and regularly reviewing expenses. It’s important to strike a balance between controlling costs without compromising the quality of your products or services.
Funding options for an eCommerce business may include self-funding, loans from financial institutions, angel investors, venture capital, crowdfunding platforms, or partnerships. Consider your business’s financial needs, growth plans, and potential risks when exploring funding options.
The break-even point is the point at which your total revenue matches your total expenses, resulting in neither profit nor loss. It can be calculated by dividing your fixed costs by the contribution margin (selling price per unit minus variable costs per unit). This calculation helps you determine the minimum sales volume required to cover costs.
Tracking CAC and CLV is crucial for understanding the effectiveness of your marketing and sales efforts. CAC helps determine the cost of acquiring a new customer, while CLV estimates the value a customer brings to your business over their lifetime. By analyzing these metrics, you can optimize your marketing strategies and ensure that the cost of acquiring customers aligns with their long-term value.
If you're on a Galaxy Fold, consider unfolding your phone or viewing it in full screen to best optimize your experience.
Published on Sept. 9, 2024
By: Ben Gran
Passive income is a concept that gets a lot of discussion from online entrepreneur gurus. And while some passive income ideas are overhyped, there are lots of legitimate ways to make real money online by starting a business that mostly runs itself -- and automatically puts money in your business bank account .
I've been making money online as a full-time freelancer for many years. But I've mostly been creating content for other people's businesses. And while I love my career and it's not too late, I sometimes wish I would have used my skills and energies to start an online passive income business of my own.
Here are a few passive income business ideas that I wish I would have started five years ago.
My college degree is in History. I love History and I'm glad I studied it, but sometimes there's a misconception that you can't get a job with a liberal arts degree. Fortunately, I've never been unemployed for a single day since I graduated from college (despite a few close calls).
These business credit cards that offer a convenient and efficient way to separate personal and business expenses, simplifying accounting and tax reporting.
Additionally, business cards can provide valuable perks such as rewards points, cashback, and expense tracking tools, enhancing financial management and the potential to help save money in the long run.
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On Chase's Secure Website. | Our ratings are based on a 5 star scale. 5 stars equals Best. 4 stars equals Excellent. 3 stars equals Good. 2 stars equals Fair. 1 star equals Poor. We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs. | Earn $900 bonus cash back Earn $900 bonus cash back after you spend $6,000 on purchases in the first 3 months from account opening. | Earn unlimited 1.5% cash back on every purchase Earn unlimited 1.5% cash back on every purchase made for your business | 0% Intro APR on Purchases Purchases: 0% Intro APR on Purchases, 12 months Balance Transfers: N/A 18.49% - 24.49% Variable |
On Chase's Secure Website. | Our ratings are based on a 5 star scale. 5 stars equals Best. 4 stars equals Excellent. 3 stars equals Good. 2 stars equals Fair. 1 star equals Poor. We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs. | Earn up to $750 bonus cash back Earn $350 when you spend $3,000 on purchases in the first three months and an additional $400 when you spend $6,000 on purchases in the first six months after account opening. | Earn 5% cash back in select business categories Earn 5% cash back on the first $25,000 spent in combined purchases at office supply stores and on internet, cable and phone services each account anniversary year. Earn 2% cash back on the first $25,000 spent in combined purchases at gas stations and restaurants each account anniversary year. Earn 1% cash back on all other card purchases with no limit to the amount you can earn. | 0% Intro APR on Purchases Purchases: 0% Intro APR on Purchases, 12 months Balance Transfers: N/A 18.49% - 24.49% Variable |
It seems like everyone has a podcast nowadays. But even though there's no guarantee of overnight success or vast riches, it's possible to start a podcast (or YouTube channel, or both) and make money from it. Successful author and podcaster Ramit Sethi says a typical podcast with 10,000 downloads might earn $500 to $900 per month. If you have a YouTube channel with 20,000 views per day, you can expect to earn at least $13,400 per year from ads.
That's not enough to live on, but it's worth pursuing. And if you start a podcast or YouTube channel, you can use it to promote your business, build your brand, host guests to cross-promote and expand your audience, and sell other products and services to your audience.
Along with studying history and daydreaming about starting businesses, another thing I love to do in life is travel. I have traveled to a total of 12 countries, and visiting other places is one of my greatest joys and adventurous learning experiences.
Some people start businesses online where they serve as travel coaches -- offering travel advice, travel consulting, and even guided tours and customized "travel agent" services. Not all of these services count as passive income -- if you have to actually show up in real life and lead a group of people on a tour, that counts as active income in my book.
But as an online travel coach, you could sell webinars, guidebooks, or one-on-one coaching sessions where you help people plan a trip, book cheap flights, and find out how to have the international travel experience of their dreams.
If you want to start an online business, it's worth asking yourself:
You could turn your expertise into an online business.
I'm a writer. Why haven't I been writing and publishing my own books? Authors can use tools like Amazon Kindle Direct Publishing to self-publish their books online and sell directly to their readers. Not every author becomes a huge success, but some Amazon Kindle self-published authors make $150 per month, or up to $20,000 per month if they have big followings and lots of buyers.
I've spent so much time in the past 15 years writing content for websites and thinking about how to get people to click on headlines, I should have started my own e-commerce business by now.
Getting people to buy products online is an art and a science. Starting your own online store can be a great business idea because you don't always need much money to get it off the ground. And you can constantly experiment, evolve, and adapt your business to better serve your customers.
Great free resources exist on Shopify and HubSpot to help you learn how to build and market your e-commerce business. If you put in the time and effort, you can learn the ins and outs of SEO, search engine advertising, building traffic, finding a niche in the market, and closing sales with customers.
Starting an online business that earns passive income takes time and effort. There are no guarantees or overnight successes. But I sometimes wish I had started my own online business years ago.
Building up your own brand, your own audience, and your own base of diversified recurring revenue can give you better financial security than any job ever could. The most important things you need to start an online business are curiosity, tenacity, hustle, and a willingness to learn.
Ben Gran is a freelance writer based in Des Moines, Iowa. He has written for regional banks, fintechs, and major financial services companies. Ben is a graduate of Rice University.
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Table of contents, why is it important for consultants to have a risk management plan, what kinds of risks do consultants face, 1. risk identification, 2. risk analysis, 3. risk evaluation and ranking, 4. risk response, 5. risk monitoring, insurance for consultants.
There’s a relatively common notion that independent consultants spend a lot of their time traveling abroad and doing their work poolside (probably with a pina colada in hand). Sounds like a dream, right? It’s a dream for consultants, too, because it’s far from reality for most.
While that may not reflect the real world for many consultants, there are still plenty of perks to consultancy work. Think: flexible work hours, variety, networking, and, yes, the ability to travel.
But being a consultant also comes with some unique risks that many other professionals don’t encounter. A consultant’s livelihood relies heavily on their client relationships, which could mean financial ruin if those relationships get jeopardized. That’s why every consultant needs to have a risk management plan in place, to successfully tackle the inevitable challenges while also making the most of opportunities for growth and innovation.
With that in mind, we’ve put together this guide with everything you need to create a risk management plan for your consultancy business.
You may be thinking, “Risk management plans are just for large corporations.”
Think again.
Every business has risks and independent consultants are no exception. Whether you provide consulting services in marketing, IT , HR, financial services, graphic design, or even risk management, there are risks that could compromise your success and reputation. That’s why it’s crucial to be proactive and use all the resources at your disposal to minimize and control the impact of potential and real threats.
Because simply ignoring business risks won’t make them go away.
Consultants are brought in as experts in their field, which means that their clients typically have high expectations for their work. What’s more, competition can be fierce for consultants. In fact, the global management consulting services market is expected to grow from $976.3 billion in 2022 to $1,184 billion in 2027 . Having an effective risk management plan goes a long way in helping consultants manage client expectations and stand out from the competition.
No matter what stage your consulting business is at, it’s essential to know the challenges you may face. While threats can vary based on your specific area of work, there are several risks that all consultants, regardless of their industry, must be ready to tackle.
Unhappy Clients: No one can please everyone all the time, and there are plenty of reasons for unhappy clients in the consultancy world. Think: missed deadlines, cost overruns, failure to meet expectations, misrepresentation, and miscommunication. Even with detailed contracts and clear communication, unhappy clients are inevitable. That’s why this risk should be top of mind for all consultants.
Data Breaches: Most consultants store client data on their computers, meaning a data breach could have devastating financial and PR consequences. Considering that the global average cost of a data breach in 2023 was $4.45 million , a 15% increase from three years prior, it’s easy to see why so many businesses don’t survive a data breach or cybercrime. This isn’t a threat any consulting business can afford to overlook.
Unpredictable Markets and Unstable Income: If there’s one thing that’s certain in consulting work, it’s uncertainty. Most consultants are familiar with the feast or famine cycle . It’s easy to get caught up in that cycle, where all of your attention goes to a current client, followed by a period of no work — and no income . The delicate balance of paying attention to existing clients while finding new ones isn’t easy, but it is necessary.
Scope Creep: You know when a client asks for extra work beyond what’s been agreed upon and included in the contract? That’s known as scope creep, and it can be a tricky situation for consultants to deal with. Those just starting their consulting career may be tempted to complete extra requests as a favor to a client. While you may think this is one way to keep them happy and coming back to you, it can lead to problems like missed deadlines, subpar work, and setting an expectation that is hard to maintain.
Now that you know some of the risks your consulting business may encounter, what can you do about them? Having a risk management plan will help you stay on top of issues that could threaten your business — it may also help you spot opportunities for growth.
Below are the key steps for creating a risk management plan for your consulting business:
Knowing about a risk means you can plan for it. That’s why the first step to take when preparing a risk management plan is to identify all potential threats to your consulting business. Be sure to look at all aspects of your business. Some threats are obvious, while others may take a bit of research to discover.
At this stage, you may find it worthwhile to start a risk register , where you can document information for all identified risks.
Once you’ve identified risks, you can analyze them and determine the potential quantitative and qualitative impact each could have on your business. That means figuring out the likelihood of a risk occurring versus the effect it could have.
This stage is where you ask, “How likely is it that this risk will happen, and what will it take to recover if and when it does happen?” Ranking risks is a vital step as it helps you understand how to prioritize resources to mitigate specific threats. A risk assessment matrix can help you visualize each risk’s likelihood and impact.
Once you’ve ranked the risks, the next step is determining how to respond to each one. This could involve mitigation tactics, such as limiting who has access to sensitive information or transferring the risk to a third party with insurance. For example, if you’re concerned about a data breach, you can transfer the associated risk to your insurance provider with cyber liability insurance .
There is no such thing as “one and done” with risk management. While new risks are inevitable, eliminating one risk could result in another threat popping up. A risk management plan is a living document that needs to be reviewed regularly and updated as required. You don’t want the plan to end up outdated and irrelevant when you need it.
Want more tips on preparing a risk management plan? For a complete breakdown of how to put together an effective risk management plan, check out our detailed guide .
Risk is simply a part of doing business. You can’t have one without the other.
And risks will inevitably change over time; new concerns will emerge as your business grows or a project progresses. So, to successfully grow your consulting business, you have to keep on top of threats that could jeopardize your practice.
One of the most effective ways for consultants to manage risk is by transferring it to a third party, such as your business insurance provider. With coverage like professional liability insurance , your consulting business will be protected from allegations of errors and omissions, while cyber liability insurance will help your firm withstand a data breach.
To learn more about coverage for consultants , read our recent blog post that outlines everything about the insurance policies consultants need .
What is errors and omissions insurance a comprehensive guide for professionals.
In today’s fast-paced business world, mistakes happen. But when those mistakes cost your clients money, you could find yourself in hot water. That’s where errors and omissions (E&O) insurance comes in. If you’re a professional offering services or advice, E&O insurance isn’t just a nice-to-have — it’s a must-have. Let’s answer the question, what is […]
If you’re just starting your legal career, you may think that a legal malpractice claim could never happen to you. While that’s hopefully the case, the reality is that the majority of lawyers will face a malpractice claim at some point in their career. According to the American Bar Association (ABA), four out of five […]
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What will happen to the bay area’s millions of square feet of closed mall space, san leandro’s bayfair center is the latest example of how former shopping centers are being reimagined.
Developers plan to replace the mall with the Speedway at Bayfair, a 400,000-square-foot redevelopment project offering research and development space for Bay Area tech companies to the former shopping epicenter at E 14th Street and Hesperian Boulevard.
It’s the latest example of how the Bay Area’s huge commercial spaces, once packed with chain stores and food courts when malls ruled the shopping landscape, are being reimagined in the post-Amazon age.
“It’s been great because the project has a ton of good infrastructure,” said Steve Kapp, Speedway’s project manager and B3 Investors’ executive managing director. “When I say that, I mean it has very heavy amounts of power there and tons of air conditioning. Those two things are key for cooling in R&D spaces.”
The Bayfair Mall opened in 1957; built for $25 million, it boasted more than 80 stores at its peak and was able to accommodate 15,000 cars in its parking lot, according to an Aug. 8, 1957 San Francisco Examiner article on the store’s opening. The mall once featured leading American department stores like Macy’s, Target and Kohl’s.
But Bayfair has watched those stores close over the past decade—as did other once-popular Bay Area shopping centers, including the Hilltop Mall in Richmond and the Vallco Shopping Mall in Cupertino, which have closed as online retail grew to dominate the retail marketplace, making trips to department stores in malls obsolete .
In July 2022, the Bayfair Mall’s owner, Madison Marquette, along with affiliate Newmark, sold the 42-acre property for $57 million to B3 Investors with plans to redevelop the aging shopping center.
The mall’s interior officially closed in early 2023, but the loss of Macy’s in April 2024 – a store that had been a tenant since the mall opened in 1957 – marked a turning point as developers focused on creating a new iteration of the property.
“Looking at as closing down a mall is not the right way to look at that property,” said Nancy Wallace, a UC Berkeley professor of real estate and sustainability.
Wallace has turned Bayfair into a literal textbook example of what is happening to former malls—she uses the Speedway redevelopment project as a model for her students to learn about adaptive reuse, turning empty storefronts into homes, labs and startups.
Wallace said dead malls across the Bay Area and beyond are finding new life as redevelopment projects that seek to address a new set of community needs such as housing, transit-oriented development and office space for emerging industries.
“This is a huge effort to build a great deal of housing, including workforce housing. The core lab is part of the economic motivation for all of this,” Wallace said. “The fact that they have already redeveloped the Macy’s site with paying tenants and turned those empty comic book stores into high functioning tech space filled with Stanford and Berkeley PhDs is amazing.”
In the South Bay, the city of Cupertino agreed in July with the owners of the Vallco Mall property to permit the construction of 2,700 housing units , with about a third set aside for affordable housing. And Prologis, a San Francisco-based real estate company that owns Hilltop Mall in Richmond, hopes to create a data center, a transportation hub and hundreds of housing units in collaboration with the city’s specific plan to redevelop the 145-acre area around the mall.
The opening of Speedway at Bayfair will also work in coordination with San Leandro’s Bay Fair Transit Oriented Development plan. The city of San Leandro aims to leverage 150-acres surrounding the Bayfair BART station to foster a mixed-use community, create public spaces and enable a “range of development scenarios,” according to Bayfair planning documents .
As stores left the Bayfair Mall, the city of San Leandro gained more leverage to create flexible zoning for mixed-use development that utilizes pre-existing transit lines, said San Lorenzo Assistant Communication Development Director Avalon Schultz.
“We saw a chance to rezone and provide property to evolve away from strict mall uses,” Schultz said. “The Bayfair plan, in coordination with Alameda County, was really looking at how to build on this prime location next to BART and turn it into a mixed-use transit village.”
BART has already taken notice of the progress at Bayfair. A 2024 update to BART’s transit development plan showed the Bay Fair station was re-evaluated from a mid-term project to a short-term project, citing the Bay Fair station’s high rankings in development streamlining, market readiness for offices and development capacity.
Phase I of the Speedway at Bayfair is already complete, with numerous Bay Area biotech and green energy companies moving into 140,000 square feet of renovated office space, Kapp said. Charge Robotics, a green tech company specializing in automating solar installation, has moved into the former mall where residents used to purchase corndogs and bedazzled shirts.
“With Macy’s going out, that is part of the second phase, and that’s another 250,000 square feet available starting in 2025,” Kapp said. “I think it’s going to become a nice mixed-use project for innovative projects for companies that are seeking affordable space with lots of power.”
Developers have already reinvented one shopping mall in San Leandro called Gate 510, a 300,000-square-foot biotech campus on 1900 Davis St. While the projects have some similarities, Kapp said Speedway at Bayfair has more retail amenities that make the redevelopment project a true campus for the surrounding community.
“When B3 bought the mall in 2022, they had already proved they could be really creative with redeveloping properties in San Leandro because of their Gate510 site,” Schultz said. “It was exciting to see how they wanted to invest in the interior of the mall to create Speedway. This building has been changing and evolving over time. It’s never been one thing.”
Business | can movie theaters survive in the bay area.
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How to Make an Ecommerce Business Plan for Your Startup
How to Write an Ecommerce Business Plan [Examples & ...
How to Write E-commerce Business Plan + Template
E-commerce business plans give an overview of what the management team expects to accomplish with the business and offer reasons why the readers should consider investing. This e-commerce business plan template is tailored specifically to e-commerce businesses, and all you need to do is add the details of your company.
Click and Cart Revolution: Ecommerce is massively expanding, now a $6.31 trillion market, expected to rise above $8 trillion by 2026. Online sales are booming, making now a ripe time for starting an ecommerce venture. Blueprint for Success: An ecommerce business plan is essential, serving as a detailed roadmap for starting, running, and growing an online store.
How to Write an eCommerce Business Plan Template
Ecommerce Business Plan Example Below is an example business plan that we've written for a fictional cookware business. You can see how it breaks down the most important parts of a business - overall business model, competitive advantages, messaging guidelines, target audiences, budgets, key personnel - in a highly summarized, accessible format.
Nike is a popular consumer products company that designs, develops, and markets their product line of footwear, apparel, equipment, and accessory products worldwide. It designs athletic, casual, and leisure footwear for men, women, and children. Nike's footwear products include running, training, basketball, football, soccer, sport-inspired ...
This customised business plan template is specifically designed for those crafting a strategy for an e-commerce business. It contains every essential element of the e-commerce business plan that you need to consider—from your Executive Summary to the important Appendices. It has all the key components: Business Description, Market Analysis ...
Ecommerce Business Plan Template. Over the past 20+ years, we have helped over 10,000 entrepreneurs and business owners create business plans to start and grow their ecommerce businesses. On this page, we will first give you some background information with regards to the importance of business planning. We will then go through an ecommerce ...
E-commerce business plan examples. 1. Draft an executive summary. An executive summary outlines everything included in your business plan. It's the first section of your plan—which makes it important because it should capture the reader's attention and entice them to read through the rest of your ideas.
E-Commerce Start-Up Business Plan Template + Example
Whether you're seeking investment or planning your e-commerce marketing strategy, it's vital you get all this information down in one place. Make sure to include your: Company name. Industry. Business structure (e.g. sole proprietor, partnership, LLC) Vision, mission statement, and value proposition.
Writing an eCommerce business plan is one of the first steps you should take if you're thinking about starting an online business. Whether you're opening an online-only shop or adding an eCommerce component to your brick and mortar store for an omnichannel retail experience, there's never been a better time to sell online.. The numbers don't lie: since 2014, the number of digital ...
NoHassleReturn.com is an e-commerce start-up company positioning itself to become the market leader in offering online merchants and consumers a uniform and trouble-free way to return merchandise purchased online. The company offers a business-to-business solution to online merchants of physical, non-perishable products.
Writing a formal ecommerce business plan lets you: Communicate your goals and vision of the present and future. Have a comprehensive understanding of what it will take to build a successful ecommerce business. Lay out your core value proposition and how you intend to deliver it.
Example Ecommerce Business Plan. Explore our E-commerce Business Plan, presented below. If you prefer, you can access a downloadable Google Doc version of this bar business plan template, allowing you to personalize and tailor it to your specific needs. Additionally, a helpful video walkthrough is available, guiding you through the process of ...
Free Business Plan Template for Small ... - Shopify
For aspiring ecommerce owners, having access to a sample ecommerce business plan can be especially helpful in providing direction and gaining insight into how to draft their own ecommerce business plan. Download our Ultimate Ecommerce Business Plan Template. Having a thorough business plan in place is critical for any successful ecommerce venture.
A successful ecommerce business plan will accomplish several key objectives. First, it will help you create business goals for your online business and give you a roadmap to follow to reach them. It will also help you develop the right sales strategies to attain your goals. For example, by understanding market trends, the strengths and ...
How is an E-Commerce Business Plan Different From Other Kinds? The way e-commerce businesses reach their customers is much different. At a brick and mortar store, for example, foot or vehicle traffic will contribute to a lot of free advertising for the business. E-commerce stores, on the other hand, can very easily get buried in the SERPs ...
By crafting a comprehensive business plan for your online retail operation, you can effectively pinpoint your target audience, set clear monthly and quarterly sales targets, and significantly enhance the prospects of achieving long-term success in the e-commerce industry. As a business plan writer and consultant, I've authored over 15,000 ...
7 Business Plan Examples to Inspire Your Own ...
A few types of passive income online business models include blogging, podcasting, and e-commerce. A typical podcast with 10,000 downloads might earn $500 to $900 per month -- but podcasting is ...
Wix. Wix is a template-based website builder that offers designs suitable for almost every business and industry.. Much of Wix's functionality is available for free, but premium plans are also available if you want to do things like remove Wix ads and add a customised favicon - the little image that appears in the browser tab.
In today's fast-paced business world, mistakes happen. But when those mistakes cost your clients money, you could find yourself in hot water. That's where errors and omissions (E&O) insurance comes in. If you're a professional offering services or advice, E&O insurance isn't just a nice-to-have — it's a must-have.
Developers plan to replace the mall with the Speedway at Bayfair, a 400,000-square-foot redevelopment project offering research and development space for Bay Area tech companies to the former ...
After peaking at more than $8.50 at the beginning of the year, the company's shares had fallen back to $5.68 by Friday's close. The CSIRO remains the company's largest shareholder.