While having dinner with your friends, someone suggests, “Why don’t you start something of your own? You know a great deal about the business.” And you start thinking that perhaps it is the time you start your own eCommerce business. The thought of it makes you feel excited yet overwhelmed and intimidated too. It’s not you, every new entrepreneur feels that way.
And having a second thoughts are normal for anyone. Because when you look at the stats of small business start-ups, you’ll find that 20% of new businesses fail in the first year and 30% in the second. Every month, the world sees on average 550,000 new businesses coming to life and only half of them survive 5 years down the lane. This indicates that competition is too stiff and without a solid plan businesses crash and burn to grounds.
While 30% of companies that are still in business after the 10-year mark have something in common – an ultimate goal & a successful business plan. And we have prepared a practical guide to establish a successful business. This is part-1 of our extensive guide. Read the part-2 here. Now, without further ado let’s get started.
Why Do You Need a Business Plan?
A business plan helps you focus on important things and goals. It includes blueprints to achieve the growth & financial goals within the projected timeline. A solid plan can help you clarify many things such as cash flow, expenses, resources required, tools for marketing, and distribution channels. Moreover, creating a business plan helps you to pinpoint problems and obstacles you may face. Let’s see other ways, how it can be helpful.
1. Helps to Gain Deep Understanding
Creating and writing a business plan on paper help you to uncover some deep understanding you might not have thought of before. Once you write it down, you’ll find subjects such as tax calculations, employee hiring process & their benefits, warehouse needs, supply chain, and others. Also, going deep will help you uncover who are your customers, whether you need an office or can work from home, what kind of products you sell: physical, digital, or services.
2. Resource Planning
Let’s say you have a top-class business idea but it’s worth nothing if you don’t have the resources to bring that idea to life. Sure, you would require financial resources, but it’s not the only one on the list. So, let’s look at what resources are required.
- Financial Resources:
What most business owners do is that they start small and gain capital as they progress. However, you still require some initial investment in buying equipment, products, paying employees, eCommerce website development, etc. We would suggest that put aside your savings and go for a business loan, find investors for your business, or run a crowdfunding campaign.
- Physical Resources:
The physical resources consist of equipment you’ll need to run an eCommerce business. A few good computers or laptops, a camera for taking pictures of products, a printer, an office, and all sorts of things that running a business from office needs. If you plan to manufacture products yourself, then you’ll need a manufacturing plant, machinery, raw materials, transport vehicles, etc.
- Human Resources:
Figure out that you can work alone or need to form partnerships. Moreover, you’ll need to employ humans who can do the job. Human resources also include subcontractors, freelancers, courier partners, and trained workers to carry out production if you manufacture the goods on your own.
3. Plan for Future
One mistake that many entrepreneurs do is that they don’t have a vision for the future. So, we want to advise you to have a vision of what your brand looks like after 5, 10, 20 years down the lane. Do you want to become a global brand? Do you plan to take your company public? Whatever it is, it’ll surely help you catapult your business towards success.
4. Analyze Competitors and Find Opportunities
Analyze your competitors, what products they sell, their strengths and weaknesses and learn from their mistakes. Try to sell products with the same or better quality than the competitors. Also, you can look for opportunities in the form of selling products that complement products others are selling.
Getting Started with Business Plan
First, you need to read and understand few of the business plans if you can get your hands on them. Review some sample templates before you start full-fledged business planning. The answers to the following questions will help you create a strategic outline for your business.
1. What You Want to Sell?
Define what kind of products you want to sell: physical, digital, or services. Tell your eCommerce store visitors, what you offer to sell and why. Do you sell an extensive range of products or only a single product line whatever it is be specific about it.
In the case of digital product, be clear what it is & how visitors can access such products. Let your consumers know that you offer software, music, or streaming services. Also, let them know how to download, or subscribe and if they require any licensing.
Describe the services in a clear way to let your visitor know what you do and what benefits they get from your services. Your description of the products or services should indicate what’s in it for the consumers.
2. Define who is Your Target Audience?
While you are planning for your business, you’ll come across a question, who is your target audience? Is your audience general public (consumers) or other businesses? Do you intend to target male, female, parents, couples, or any other? Define your target audience as clearly as possible and narrow them down. E.g. if you sell sports or gym equipment, then your target audience would be athletes and gym-goers.
This will help you craft a stunning marketing strategy that attracts the target audience to boost sales and conversion. Figure out the needs of your target audience so that you can personalize their shopping experience when they visit your site.
3. How to Build a Product Supply Chain?
If you take care of the manufacturing of your products or software, then the only thing you need to worry about is setting up shipping & logistics or download service. Most use third-party manufactures and sell their products online. In that case, you need to set up a supply chain well in advance of your store’s launching date.
Continue reading part-2, we will discuss 7 essential things about creating a successful business plan.
So, here we conclude the part-1 for creating a successful business plan. In part-2, we have covered 7 essential parts of crafting a successful eCommerce business plan. Both the articles will help you lay the foundation for creating a stellar eCommerce business plan. Consult our eCommerce experts if you need help with starting your eCommerce store from scratch. We have 12+ years of vast experience in the eCommerce field with 3000+ happy clients.