Do you want to grab the opportunity presented by the increasingly popular e-commerce stores? Do you want to build your own e-commerce store equipped with the most essential features? Well for this you need to have a detailed business plan and know all the steps leading to the development of a successful store.
A clear and well-documented business plan for an eCommerce store can help you know the effective tactics, identify the business opportunities and know about the potential obstacles, make an assessment of the required resources and capability to evaluate future growth plans. When you go to any reputed startup consulting service to discuss the steps leading to a successful e-commerce store, they are very likely to come up with a detailed business plan first covering all aspects of the business.
Here we are going to explain all the steps leading to the creation of a successful e-commerce store.
For building a successful e-commerce store you need funding and for that, you need to show the investors a detailed plan. A business plan will help them evaluate the potential of your business and corresponding opportunities and risks. Apart from helping the process of getting funding, having a detailed business has other benefits. Here are some of the benefits.
Now that we have a gross understanding of the importance of having a business plan, let us now explain the steps in detail for building an e-commerce store.
The first thing that a business needs to decide is to determine the products or services it wants to sell. Once you have decided on that, you need to determine the type of e-commerce business you want to establish. Some of the types of e-commerce business types to consider include the following.
B2C is the most common and popular e-commerce retail business model. According to this model, the e-commerce retailer basically sells directly to end-user customers. Amazon is a great example of a successful e-commerce store. This model requires less cost for starting.
B2B model as the name suggests is the model facilitating business to sell its products and services to another business. relates to providing goods or services from one business to another. B2B business model involves increasing startup costs. The famous electric goods brand General Electric follows this model as it markets its products through a network of distributors and multi-brand retailers.
C2C is another business model that facilitates sales and purchases of goods among consumers. Some e-commerce stores and websites basically work as the third-party aggregator platform to facilitate these sales and purchases and for every transaction, they either charge a commission or just take a membership fee from the users of the platform. eBay is a great example of this e-commerce business model.
C2B is the business model in which consumers sell goods or services to businesses. This model mostly works for buying services from professionals. Upwork is a great example of where you can sell your expertise to an organization.
Once you have determined the precise business model for your store, it is time to manage the inventory and plan for sourcing goods for sales. Now you also need to decide about the right revenue model for your business.
There are various e-commerce revenue models with their respective pros, cons, opportunities, and challenges. Let us briefly explain various revenue model options.
Dropshipping is the ideal model if you want to run an e-commerce store without really handling the inventory. According to this model you just need to set up an e-commerce storefront and the inventories, as well as product sourcing, are taken care of by the suppliers. For Startups, it is a lucrative revenue model involving little challenge and cost.
In case you are capable of managing your own business warehouse and track all customer orders and can make investments for in-stock inventory, you can choose a wholesaling or warehousing) revenue model.
If you can manufacture unique products that only you can develop, you can choose this revenue model. To embrace this model you need to create prototypes of the products and make contacts with the capable manufacturers who can produce and supply. The manufacturers can directly ship products or can send them to your warehouse for further shipping.
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For your e-commerce store, you need a catchy brand name that instantly resonates with your audience. An easy to remember brand name that makes sense to your business deliverables is a key aspect of the branding. Take use of various keyword tools and do extensive research for finding the right brand name that quickly makes an impression.
Some of the key considerations for creating the right brand name include the following.
Once you have decided on the brand name, you need to create a visually appealing and memorable logo that fits the brand perfectly. Some of the key qualities that a logo should have to include the following.
Not all businesses are likely to have graphic design expertise in creating appealing logos. This is why it is advisable to hire an expert graphic design company to create your business logo.
Market analysis is a critical aspect of any business plan whether the business is online or just a regular offline store. The market analysis allows businesses to obtain in-depth market knowledge and a clear picture of the audience size you are targeting, the competitive position of the business, and the demographics of the customer. Having a clear understanding of all these aspects is essential to make a business plan full-proof to stand the onslaught of competition.
Let us have a look at some of the must-do tasks for e-commerce market analysis.
Apart from doing all these, the market analysis also needs to utilize two widely acclaimed analysis methodologies such as PESTEL analysis (political, economic, social, technological, environmental, legal aspects having an impact on businesses) and SWOT analysis (strengths, weaknesses, opportunities, and threats of a business). These two analysis methodologies will help you evaluate your business from all angles and perspectives.
Now, it is time to have a detailed and meticulous marketing plan in place. A marketing plan basically will help you have strong and comprehensive control on your marketing strategy and activities for a time span. Some of the marketing tactics that you need to plan for include SEM (search engine marketing),
SMM (social media marketing: Instagram, Facebook, etc), SEO (search engine optimization), content marketing, and email marketing.
As e-commerce is basically a digital business venture, your marketing should focus more on reaching out to the audience using the digital avenues instead of traditional media and outdoor ads and marketing. For every social media channel, you need to have specific content and posting strategy that resonates with the audience. Similarly, your content marketing and search engine optimization (SEO) should resonate with one another and help your brand to get more visibility through popular, viral, and valued content.
When having your marketing plan in place, remember that the plan should cover the below-mentioned aspects in detail.
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Every e-commerce business plan should also have a very detailed and meticulous operational plan. The operational plan should explain how you are going to source your products or create them and distribute and sell them to the customers through a streamlined process. Making a plan that guarantees smooth operation from the product creation or merchandising to the sales and delivering them through a supply chain is crucial to the success of any e-commerce store.
When making a detailed operational plan to run your e-commerce store, you should cover the following aspects of your plan.
Finally, an e-commerce business must plan for funding and meeting the financial requirements. You have to make a detailed financial plan corresponding to the operational business cost, the projected revenue earning opportunities, and the overall financial status of the e-commerce store. The plan should also give a detailed plan to meet the contingencies.
When creating a financial plan for an e-commerce business following aspects should be covered in detail.
Finally, a financial plan is essential to make a realistic plan to make a solid ROI projection that meets the expectations and keeps the business running and achieving new heights of growth. The financial plan is also necessary to convince your investors about your business solvency and financial strength.
Since small businesses and startups are increasingly embracing e-commerce stores as the new digital opportunity to reach out to more customers and achieve growth, in the e-commerce sector also the heat of competition is increasing steadily. This is especially why making a meticulous business plan is so necessary.
WRITTEN BY: Jeegnasa Mudsa
Jeegnasa Mudsa is Executive Director at CMARIX Technolabs Pvt. Ltd. a leading eCommerce development company with 15+ years experience. A blend of true Engineer and…
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