How to Develop an Articulate Business Plan for Your Ecommerce Business
Do you have dreams of starting your own ecommerce business?
Do you already have exciting business goals you can’t stop thinking about throughout the day?
While it’s certainly true that the world of ecommerce represents endless potential for people who can think big, don’t spend too much time in the clouds.
Before you will ever see a dime from your dream, you’ll need an articulate business plan that will serve as a roadmap to success.
5 Things to Consider in Your Ecommerce Business Plan
Don’t let your excitement get the better of you. Although creating an ecommerce business plan probably doesn’t possess the same thrill as imagining those giant paychecks coming in, take the time to create one now and you’ll reap the benefits later (probably even sooner than you think).
Here are five simple steps for putting one together.
1. Start with Your Company Description
Chances are, you already have an idea of what your company is going to do, but write it down anyway. This will help make your idea more “real” and will serve as a valuable reference point as things move forward.
Your company description should also include things like any competitive edges you have and what kind of ecommerce branding you hope to employ to differentiate yourself from competitors.
2. Understand Your Target Market
How much do you know about your customers?
Take the time to learn everything you can about them, so you can construct accurate buyer personas. This will make it easier to build an attractive site and market it to these potential customers.
Remember: having the best product is a good start, but if you don’t know how to market it to consumers, you probably won’t be selling much.
3. Establish an Operational Plan
Your ecommerce business’ operational plan should consist of when you intend on working. If you’re only going to be part-time for now, that’s fine, but put a concrete schedule down. If you’re working full-time, great, but it’s still important that you set a schedule in stone and stick to it.
This plan will also consist of how you’ll handle your ecommerce business’ accounting and what kind of inventory practices you’ll employ. Even if you’re using drop shipping or Amazon FBA, write this down for the section about your inventory.
4. What Are You Selling?
This part of the business plan is about as straightforward as it gets: describe the products and/or services you’ll be selling on your ecommerce site. Don’t just list them, though. Describe them as your customers would.
5. Create a Marketing Plan
That level of detail will make a big difference in your marketing plan. Buyer personas help, but now that you know who these people are, you need to get clear on which tools and tactics you’ll use to turn them into customers.
Establishing Short- and Long-Term Business Goals
It’s extremely hard to put objective milestones on an ecommerce business plan.
Unless you can obtain the financials on a similar company, it’s probably best to stay away from those kinds of goals.
Instead, you should look at objective metrics of ecommerce success that you can control:
- Customer Acquisition Cost – Between SEO and other marketing tactics, how much are you spending to bring a visitor to your ecommerce site and turn them into a customer?
- Repurchase Rate – How often do customers come back and buy again and long does this take for them to do? The longer it does, the more you’ll need to work on finding new customers.
- Profit Margins – How much do you make from each sale? You could sell something for a million dollars, but if you only make a single dollar, you’ll need to sell a lot. The better your margins, the more you’ll make from every customer.
Admittedly, these aren’t as fun as earning a million dollars within your first year, but aiming your ecommerce business plan at these metrics will definitely keep your company afloat long enough that you can begin thinking of more ambitious goals.
Long-Term Business Goals
Making money online with an ecommerce business will eventually become part of a normal day.
After a few months of this, you’ll now be able to adjust your business plan to think about long-term profit goals.
For example, if you make an average profit of $8,000 a month, you know that a year from now, you should be able to clear $96,000.
However, it would be wise to place your sights a bit higher. See if you can add 5% or even 10% to that number. Ambitious business goals are always better than realistic ones.
Understanding the Role of Technology
One step far too many people miss when they’re starting a business is to think about he role technology will play.
In simplest terms, your use of technology will most likely decide how successful you are. In fact, you could even fail for not making the most of what the digital world has to offer.
Put another way, a competitor with an inferior product and less passion for the industry could put you out of business because they invested in better marketing technology.
A prime example of this is ecommerce personalization.
This technology will actually modify your company’s website in real-time to better fit a visitor’s unique needs.
For example, someone who previously read certain blog posts may have done so because they’re interested in buying a particular product.
Therefore, you could use ecommerce personalization to ensure the easiest path to that product, further information about that product, and other webpages you know will help convert them into a customer.
The Key to Starting a Business in the Digital Age
While the technology we just referenced is certainly important, don’t forget about good, old-fashioned perseverance.
Even with all of the advantages business owners enjoy in the 21st century, it’s still going to take a lot of work. Much of that work will entail trying again and again until you refine your business plan to the point that it’s successful.
Until then, don’t give up.
You’ll be glad you didn’t when your dream business begins turning a profit.