Create your own ecommerce business plan
You may have heard people recommending that you write a business plan to support your ecommerce venture. What do they mean by this? A business plan is simply a document detailing what your idea is, how it will work, how you’ll make money, who your audience is, and other essential features of your business.
Business plans are helpful both to you as the entrepreneur, since seeing everything mapped out makes the way forward clearer, and to anyone you might look to for funding. Banks or other financial actors in charge of lending money usually want to see a business plan so they can evaluate whether they’re investing in a feasible venture.
How do you write a business plan? Break it down into sections first. Typical business plans have nine parts (see table of content on the left), though this can change based on how many elements of your business there are.
It might make sense to add more sections or combine related sections based on the business you’re running.
You can change the order of most of your business plan without too much trouble, but your executive summary always comes first. It should summarise your plan’s key points so that readers can quickly understand what your business is and how it’ll work. That’s why you should write it last, after you’ve finished determining everything about your business.
Here you answer two questions: who you are and what you do. That means you clarify what’s different about your business and why people should invest in you. Some things to cover include:
Your business structure
Here is where you provide the broader context in which you operate. You should include these three elements:
Industry analysis: A look at the general industry your business is set in
Target market: An analysis that identifies your target customers and quantifies the market’s size
Competitive analysis: A breakdown of the main competitors and their strengths and weaknesses
Management and organisation
Mention how the organisation is structured – usually with an organisational chart – along with members of the management team. As companies of one, sole traders can opt to leave out this section.
Products and services
Detail what you plan to sell to customers, including key benefits of your items or services, pricing and how they stack up against offerings from competing companies. If you’re planning to show your business plan to potential investors, it’s also worth including details on how you’ll fulfil orders, trademark or legal topics plus future product development plans.
Similar to the market analysis, here you’ll focus on your ideal customer. Describe the demographic you’re targeting, including their:
Common behaviour patterns
Values and beliefs
Tell readers about how you plan to market yourself to your ideal customer. The amount of depth needed in this section will depend on who’s reading the business plan. Your marketing plan should include:
What you’re selling
Where you’ll sell it
How much it costs
How you’ll promote it
Logistics and operations plan
This is where to discuss ways you’ll operationalise your plans. Mention your suppliers, how you’ll produce or source your goods, what equipment you need and how you’ll manage your inventory. A contingency plan for when supply chain issues arise will also keep you covered.
The financial overview is one of the most important elements of your plan. The main components of this section should include an income statement, balance sheet, cash flow analysis and, in some cases, a financial forecast. Learn how to create the first three here.
Aim for no more than 20 pages in total
Think about the goal you want to achieve with your plan before starting to write
Invest time in conducting research to better understand your market, industry and products
Try to be clear and direct and keep the style and tonality uniform across each section
Ask friends, family or associates to review the plan and provide feedback