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How to Build an eCommerce Business – Complete Guide

How to Build an eCommerce Business – Complete Guide

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.

The Key Reasons To Have a Business Plan

The Key Reasons To Have a Business Plan

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.

  • The developers get a very clear view of all the aspects and components involving the business and find the opportunities.
  • If you have a business plan, it becomes much easier to communicate your business vision and objectives to your staff and thereby build confidence in the business brand.
  • It also helps to determine all the required resources necessary to help your business thrive.
  • Thanks to the business the stakeholders and the promoters can easily assess the weak and strong points of the business.
  • With a business plan, you can easily plan for a course of action and make precise projections.

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.

First Decide About The Type of eCommerce Businesses

Type of eCommerce Businesses

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.

1. Business to Customer (B2C)

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.

2. Business to Businesses (B2B)

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.

3. Consumer to Consumer (C2C)

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.

4. Consumer to Business (C2B)

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.

eCommerce Business Application Development

Determine The Revenue Model

Determine The Revenue Model

There are various e-commerce revenue models with their respective pros, cons, opportunities, and challenges. Let us briefly explain various revenue model options.

1. Dropshipping:

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.

2. Warehousing:

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.

3. Manufacturing:

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.

Read More: Top 7 UI Trends For Boosting The Profitability of eCommerce Businesses

Choose a Brand Name and Create a Logo

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.

  • The brand name must easily appeal to the target audience
  • The brand name should fit your brand persona perfectly
  • The ideal brand name should be short, simple, catchy, and unique.
  • The brand name should also fit nicely into a domain name.

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.

  • The logo should visually communicate the brand message.
  • It should create a visual identity for the brand.
  • The logo should look good both in color and black and white.
  • The brand should also set the identity of the business apart from the competition.

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

Market Analysis

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.

  • Doing an in-depth analysis of the recent market reports and trends in the e-commerce industry, especially the ones related to your niche.
  • Visiting all the major and similar e-commerce stores and studying their customer responses and reactions to get some valuable insights.
  • Checkout major e-commerce publications and acclaimed studies corresponding to e-commerce stores and online retail.
  • Accessing both free and paid statistics and insights from Statista that is known to cover more than 500 industries across more than 50 countries.
  • Follow Google Trends and use this absolutely free tool to make comparative studies across different regions and search volume of items in various regions.
  • You can also use social media analytics and insights tools like Facebook Audience Insights to access various customer insights.

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.

Marketing Plan

Marketing Plan

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.

  • The preferred marketing solutions that are likely to work.
  • Your marketing budget and the budget breakup per year, month and day.
  • Specified deadlines for every marketing task and expected outcomes.
  • Your priority list of platforms and channels where you want to focus more.

Read More: How Workflow Automation Can Help Your eCommerce Business Operation?

Plan For Operation

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.

  • Provide details of your office of operation and physical retail outlet if you are planning to have any besides the e-commerce operation.
  • Provide details about the staffing and recruitment along with specific job responsibilities and timing.
  • Required tools and technologies for running the business operation should also find their place in the operational plan.
  • For sales operation fulfillment and shopping, you should mention the chosen options such as in-house shipping or third-party options.
  • The plan should have details about inventory management activities and requirements corresponding to storage and tracking goods.
  • The operational plan should also provide details about the company’s chosen production model. It can be manufacturing, wholesale, or dropshipping.

Financial Plan

Financial 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.

  • The financial plan should provide a realistic sales forecast and make projections on a monthly basis for the next five years.
  • There should also be an expenditure budget mentioning the amount of money that the business will spend from month to month.
  • There should be a detailed cash-flow statement and the amount of cash you have at your disposal at a given period.
  • The financial plan should also offer detailed eCommerce sales projections.
  • The plan should mention expenses on materials and other operational equipment and technologies.
  • The financial plan should also cover details about marketing funds and marketing spending.

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.

You may like this: Building a Two-Sided Marketplace for Your Business


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.

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Written by Jeegnasa Mudsa

Jeegnasa Mudsa is Executive Director at CMARIX InfoTech. a leading eCommerce development company with 15+ years experience. A blend of true Engineer and HR power house to run the Company Operations. Creative Director with in-depth experience of Technology and Human Resource domain. A people person and a compassionate Mother.

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