business plan e commerce pdf

How to Make an Ecommerce Business Plan for Your Startup

Darren DeMatas

February 28, 2024

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So you’ve decided that you want to quit your day job and start your very own ecommerce empire. That’s great!

But before you become the next Jeff Bezos  (and definitely before you quit your job!), it’s worth spending some time thinking about a business plan. In this article, we’ll dive into the key elements of an ecommerce business plan, which is very different than writing traditional business plans.

Why You Should Create a Business Plan

We know that starting an ecommerce business is exciting, and it can be tempting to jump right in without constructing a business plan. READ: PLEASE DON’T DO THIS.

If you haven’t put your ideas, questions and concerns on paper, then you haven’t given your business model enough thought .

Taking the time to write a business plan might seem like a lot of work, but it can save you a lot of time and money in the long run by better preparing you for potential challenges and opportunities that you’ll face as a first-time entrepreneur. Think of it as a roadmap for your new business venture.

It’s exciting to start your own ecommerce business. However, you want to be well prepared and not jump into anything without having a solid, foolproof ecommerce business plan in place.

After all, you wouldn’t jump out of a plane without a parachute, so why start a business without a safety device in place? That safety device is your business plan.

The business plan is the brainstorming process that ensures your concept and goals are realistic.

This is more than just mental notes. True business plans take your ideas , questions, and concerns and put those in writing.

As you start creating your business plan, you’ll soon understand that it’s more than a single piece of paper with handwritten details on it. It’s a clearly constructed format of how your business will be created, how it will operate, and what you hope the future holds in terms of a successful ecommerce business.

When you write your business plan, be sure to have a target audience in mind. Are you going to look for investors or put a Kickstarter campaign into motion and use this as your descriptive platform? If so, make sure that your business plan contains everything the audience would want to know about your business (and more!). Many traditional funding solutions require a business plan in order to give you capital. However, there are alternative solutions, such as  Payability  that specialize in ecommerce and don’t require credit checks, a business plan, or any complicated paperwork. They can also get you approved in as little as 24 hours.

When your business plan is completed, you should have achieved the following goals:

• Knowledge:  A greater sense of knowledge of the business aspects.
• Resources:  The resources you’re going to need to make your business successful, such as partners, money, employees, etc.
• Road Map: Have clear set goals to take you from the very beginning of your business and onward.
• Viability: In other words, is your business possible? Will you have enough profit margins to keep the doors open long-term?

Now that you know why you should create a business plan, it’s time to move on to how you can create your business plan and get started putting your ecommerce business into motion.

How to Start an Ecommerce Business Plan

At the very beginning of the planning stages, it’s a good idea to develop a framework for your business model. This business model will continue to evolve as you create each section of your ecommerce business plan, so don’t strive for a perfect completed plan on the first try. You will be making tweaks to the plan of certain steps along the way.

There are many ways to sell products online and different business models  to pursue. Research and learn from successful ecommerce business examples in the market. The exact business model you follow will be one that makes the most sense with your resources, skills, and interests.

In order to create the best online business plan with your product in mind, you need to figure out the following things:

What are you selling?

The first step to creating an online business is to learn the absolute basics of what you can sell.

• Physical products: Clothing , shoes, home goods
• Digital products: Software as a Service products, ecourses, ebooks
• Services: Consulting services, home cleaning

Who are you selling to?

• Business-to-Business (B2B): You are selling to organizations, corporations, and non-profits rather than individual customers
• Business to Consumer (B2C): This means you are selling to individual consumers rather than businesses
• Marketplace: You are acting as a middleman by bringing businesses and (B2B or B2C) customers to one website.

How are you sourcing your product?

• Manufacture in-house: You make your product or service in-house
• Third-party manufacturer: You outsource the manufacturing of your product or service to a third-party manufacturer
• Dropship: You partner with a dropship manufacturer. Basically, this means that they make your product, package it and ship it directly to your customer while your company handles the entire customer relationship.
• Wholesale : You buy goods or services from other companies in bulk and re-sell those products on your online store

Additional References

• Entrepreneurship: Business & Marketing Plans
• Small Business and Entrepreneurship
• Entrepreneurship Resources
• Business Plan Resources

Executive Summary

The executive summary will be written according to your goals, and it’s recommended that this is done at the very end of your business plan completion. This will ensure that you include all of the important factors about your business and present your ideas in a concise and complete way.

Some of the features you’ll include in the executive summary include information showing that you’ve done your research, you have concrete sales forecasts, and the main details about your brand.

Business Model

When you’re figuring out your business model, you have to consider four different areas:

• Monetization strategy
• Product/industry
• Target market
• Sales channel

Monetization Strategy

The monetization strategy delves into the methods you are going to use to sell your products.

This strategy will look at different product monetization methods, including white label, private label , affiliate marketing, wholesale, dropshipping, and even selling ads.

Product/Industry

The product industry section is where you summarize your main niche.

For example, “Vegan Skincare Products.”

Target Market

In the target market section, you will write a sentence or so on who your target market, or ideal customer, is in the community.

If you’re selling vegan skincare products, your target customers might be women who embrace the vegan lifestyle and use natural skincare products in their daily beauty regimen.

Sales Channel

The sales channel refers to where you’re going to sell your products.

For example, you might be selling your products on your own website, and this should be entered in this section.

Business Overview

This next section covers your company overview.

This section of your business plan will cover various features of your company, including the following:

• Company type
• Domain name
• Value proposition
• Brand traits

The brand name section lists your business name or brand name.

This is an extremely important aspect of your business plan as it’s what will set the tone for everything that follows.

Pick a brand name that’s simple yet unique and is something that can be used in a wordplay manner, if desired, but not pun-worthy.

Company Type

The company is how your business operates. For example, you might label your business as an LLC , S-corporation, sole proprietor, or some other type of business organization.

The best way to determine how you should categorize your company is to speak to your accountant. There are various tax and legal aspects to forming your business in a certain way.

Speak with the professionals in the company and corporation formation field to determine how to label your company and which company type best benefits your business in a variety of ways.

Domain Name

This section is where you list your domain name.

Choose a domain name that is memorable and embraces the overall traits and features of your business.

And, when choosing a domain name, be sure to think of SEO aspects when doing so. You’ll find out just how much all of these things tie together and ensure a frequently-visited website is the end result.

Keep in mind that with ecommerce, the domain name is just as important as the brand name. Maybe even more so!

Value Proposition

A value proposition is a short, crisp statement that will gauge how clear your idea is. Write this section as if you had one minute to explain your business to a potential investor or customer and then practice it over and over again.

The value proposition can be used on your ecommerce store as your company description.

Here’s a good example: Say you’re looking to start a hiking company called Atlas Hiking Co. which sells premium performance hiking shirts. A possible company description could be the following:

Atlas Hiking Co. is a lifestyle hiking company that produces high-performance hiking shirts for outdoor lovers. Our proprietary SPF40 fabric is one of the lightest fabrics on the market, providing mountain lovers with maximum comfort, both from a breathability and sun-protection standpoint. Our product is made in the U.S.A. and a portion of our profits are donated to preserve national parks around the country.

Pay special attention to all the sensory words !

The mission statement in your business plan is the “why” of it all.

For example, why you started the business, why you are selling the products you are selling, etc., can all be added to this section of your business plan.

You can make this portion as simple or detailed as you like. Just make sure to properly and clearly explain your business mission.

The vision part of the business plan is your “how” in the grand scheme of things. It is the dream you have for your company and the path you’re going to take to realize that dream.

When you write the vision portion of the business plan, think long-term. What are you hoping to achieve, not just in the near future but for the long haul of the life of your business?

Look into the future and plan out where you see your business in 5, 10, even 20 years from now.

This will help you construct the rest of your business plan if you know where you want your business to head, now and in the future.

Brand Traits

The brand traits section is a short section in your company overview.

Basically, in the brand traits section you’re going to want to list three to five words that describe your brand.

Think of your brand personality and describe it using a few separate powerful words.

The personnel section lists all individuals, including yourself, who will be involved in the daily operations of your business. You can create a separate section for a full operations plan or add that later.

Some business owners choose to handle all duties on their own or with a partner, while others will hire individuals to fill the following roles:

• CEO (usually the business owner)
• Management team
• Customer service/logistics
• PR/Social media specialist
• SEO manager
• Advertising manager

Competitive Market Analysis

Here’s a fact you can bank on: there has never been a successful e-commerce entrepreneur that didn’t understand his/her target market cold.

That’s why this section is one of the most important in the entire business plan. It will force you to understand the industry in which you operate, the overall industry analysis and outlook, the existing competition, and your target customer demographic.

Market Segment

The market segment portion of the business plan will help you to put your ideas down on paper, make them more focused, and get your team together.

This area will include your niche selection, target market, and competitive analysis.

Niche Selection

The niche section  provides an overview of your niche, why you selected it, whether there’s a micro niche included, and the type of niche you’ve chosen.

The purpose of this section is to crystalize the ideas that you have and make sure they are understandable and viable.

The target market section covers an overview of your target market plus describes your market segments.

Ask yourself who your  target customer  is (population size, age, geography, education, ethnicity, income level) and consider whether consumers are comfortable with buying your product category online.

When listing the target market information, make sure to mention your target audience size as this is important for ensuring that your audience will be adequately covered.

Competitive Analysis

With the competitive analysis portion of your market analysis, you want to list your market leader and direct and indirect competitors.

After you mention who these entities are, you need to list the characteristics of each one, such as domain name, business model, monthly traffic, and pricing range.

However, before you even get started in writing this section, you need to spend several hours researching your target market.

Here are some of the most efficient ways to research a particular market:

Industry reports

Google is your best friend. Look for any recent industry reports on your market of choice. This will give you a good sense of how much growth the industry is experiencing, why this growth is happening, and what are the largest customer segments. In our example of Atlas Hiking Co., we should research the outdoor apparel market.

Let’s say that through our research of the outdoor apparel industry, we discovered that there was a huge boom in youth hiking apparel. Perhaps parents were increasingly concerned about their kids’ exposure to UV rays while hiking, so they began to spend more money on their kids. We could use this valuable information to guide our business strategy.

There’s only so much you can read online. Go to a nearby store that sells similar products to yours and interview the store representative. The store rep has interacted with hundreds of interested customers, which can lead to thousands of valuable insights! It’s amazing how these insights can translate into a meaningful business opportunity.

Here’s an example:

If I were going into Billy’s Outdoor Store to research the outdoor apparel market, I would probably ask Billy the following:

• What are your best-selling products?
• What are your worst-selling products?
• Find products similar to yours and ask the representative his/her favorite features on products similar to yours.
• How much are customers generally willing to spend on these types of products?
• Do customers make repeat orders of any of these products?
• Do you get a lot of customers that are looking to buy last-minute hiking gear before they go on a hike?

Competition

Create an Excel spreadsheet of all of your competitors. In your spreadsheet, you should have the following columns:

• Competitor Name
• Price point
• Product Description
• Key Features (e.g., fabric, waterproof, slim fit, etc.)

What is the competition missing? Is there a gap in the offering? Where you can add some additional value?

After conducting the competitor analysis, Atlas Hiking Co. might find that the competition’s hiking shirts offer very few features at a low price point, but no one offers a luxury hiking shirt with additional features at a higher price point.

This is just an example of the types of insights one can gain from market research which can drastically alter your business model.

Keyword Research

By using Google’s keyword planner  and trends pages, you can get a good sense of how in demand your product is and whether it’s trending upward or downward. Google is great for a general idea, just don’t bank on it.

Some other keyword tools you can use for keyword research include Ahrefs, JungleScout, and Viral Launch. Check out this list  for more ideas.

Trade shows

Are there nearby trade shows that you can go to? Again, creating connections with other people in your industry is a surefire shortcut to countless hours of reading on the internet. Trade shows are also a great opportunity to talk to competitors, meet manufacturers, and better understand where things are heading in your industry.

Once you finish researching the relevant industry, you should summarize your findings by answering the following questions:

General Industry

• How big is the overall industry?
• How big is the specific sub-industry in which you intend to operate?
• Where has most of the historic growth in the market come from?
• Why is this the right time to enter this market?
• What are the sub-segments that are poised for future growth (e.g., youth apparel)?
• How crowded is the product category with competition?
• How is your competition distributing its product (online, retail, wholesale, etc.)?
• What’s missing from the competition’s product offering?

Products and Offers

So we know we want to sell hiking shirts, but how do you research specific products?

But for some of us, we’re not quite sure what we should sell. To succeed in online retail, you need a product that is trending upwards in a growing niche.

Different types of products

Some of the different types of products include the following:

• Convenience products: Frequent purchase products, little effort on buying
• Shopping products: Less frequently purchased in between purchases, little more effort and planning, shop around
• Specialty products: Strong brand preference and loyalty, will buy no matter what the price

The various types of niches include the following:

• Hobby niches
• Lifestyle niches
• Problem niches
• Weird/embarrassing niches

Existing products

Come up with detailed specifications for each product or service you intend to sell. If it’s a hiking shirt we’re selling, we would want to have:

• Detailed sketches of the shirt
• Fabric weight, materials, type
• Key features (e.g., pre-shrunk, water-proof, SPF 40)

Future product pipeline

What are other products that you have in the pipeline? Perhaps once you’ve successfully sold hiking shirts, you’re able to leverage your manufacturing relationships to provide hiking socks and shorts. Include that information in this section.

The products and services section will cover the various selling categories of items.

These product offerings will include the following:

• Core product

Each product group will have its own purpose in your sales catalog. For example, tripwire is the product that brings customers to your ecommerce store or online marketplaces  while the core product is your main seller.

Knowing what products you’ll include within each section allows you to have a firm grasp on what your main product will be and how the other types of products will work alongside your main product.

This section will also cover the search volume and Amazon pricing range.

You’ll need to calculate your true costs. You have to make sure you don’t overestimate your margins.

To tabulate your total true costs, you need to write down the costs in the following areas:

• Target price
• Supplier cost of the product
• Total cost per unit
• Net profit per unit
• Profit margin per unit

Once you complete the pricing portion, you’ll have everything on one sheet and readily accessible whenever you need it.

Marketing Plan and Operations

So, now you’ve concluded that you have a great business idea, and it’s in a growing market. That’s fantastic – but how are you going to drive traffic to your ecommerce website and get customers to buy it ? And how much can you afford to spend on your product?

Marketing  is everything. It’s important that your marketing efforts match your business model.

If you have a website and no marketing, your site won’t have any visitors. With no visitors, you will make no sales. Then how do you grow and sell your ecommerce business (if that’s your long-term goal)? Even with the best possible products, nobody will buy them if they aren’t directed to them in some way.

In order to come up with a marketing strategy, you need to first know your customer inside out. You should be able to answer such questions as:

• How old is your customer?
• Where does your customer live?
• What is the population of your customer base?
• What is their education level?
• What is their income level?
• What are your customer’s pain points?

With so many channels to reach your customer, which one is best for you?

Once we know pretty much everything there is to know about our target customer, we can shift focus to our marketing strategy. You want to choose marketing strategies that equal positive conversion rates. What channels should you use to grab the attention of your customer demographic? Some of the key marketing channels include:

Paid Marketing

• Pay-per-click – this online marketing typically involves using Google Shopping campaigns  and managing a product data feed.
• Affiliate sales networks – Allowing other blogs and websites to sell your product for a cut of the revenue. List the different affiliate sale networks that you plan to promote through.
• Facebook ads ⎯ Ads posted on Facebook to draw in buyers through social media means.
• Influencer marketing ⎯ Hiring industry influencers to get the word out about your product through their social media platforms and contacts.

Organic Marketing

• Social media (Facebook, Instagram , Pinterest, etc.): What is your strategy for social media, and where will you dedicate your attention?
• Search Engine Optimization : Create and promote awesome content so people find your product organically through search.
• Content marketing: Figure out how you’ll use content marketing in your business. Consider various article topics that will persuade your target audience to buy your products.
• Blogger networks: could be organic or paid through affiliate sale programs.
• Key bloggers: Develop a list of the key bloggers in your product category. For Atlas Hiking Co., this might be an influencer that blogs about the best hiking trails in America.

Finding the optimal mix of these advertising tools depends 100% on your customer segment as well as your product type. For example, a SaaS product targeting millennials will require an entirely different marketing strategy than an e-commerce physical product targeting baby boomers. Perhaps that should be a post on its own for another day!

How much should you spend to acquire a customer?

In order to understand this, we need first to discuss a concept known as customer lifetime value or LTV. In essence, this is a formula that helps you better understand how much an average customer will spend over time.

Here’s  a good read on how to calculate LTV.

It’s important to remember that for new businesses, you don’t have a lot of data on customer purchase habits so it’s a good idea to be more conservative with your assumptions in calculating LTV.

Let’s say, for Atlas Hiking Co., I determine that the average LTV per customer is $300. This means that over time, the average customer will spend $300. Let’s say, on average, if I receive $300 in revenue, $100 of that will translate to gross profit before I factor in my marketing costs (basically, I’m just subtracting the cost of making the shirts).

Knowing that my gross profit is $100 per shirt is a critical piece of information because it tells me that I can spend up to $100 in marketing to acquire a customer and still be profitable!

Some of the marketing options include social media marketing and content marketing.

Think about your business model and then line up your marketing budget. Your marketing budget may include the following items:

• Sales/branded content
• SEO/blog content
• Facebook/Instagram ads
• Influencer marketing
• Marketing tools
• Niche advertising

Choosing The Right Technology

With so much technology and SaaS products out there, it’s important to understand the various moving parts and diagram how they all integrate with one another.

Some of the different elements include:

• Shopping Cart Platforms  – e.g., Shopify , BigCommerce , WooCommerce , or any open-source platform
• Hosting – Nexcess , BigScoots , Kinsta , WPX
• Payment Processo r – e.g., Stripe, Paypal
• Fulfillment Center – e.g., Amazon, ShipBob
• Apps – e.g., Zipify, BuildWooFunnels, Gelato
• Accounting & Taxes  – e.g., Quicken, Xero
• Marketing Automation – e.g., Klaviyo , Mailchimp
• Marketing Tools – e.g.  Buzzstream, Ahrefs
• Customer Loyalty Programs  – e.g., Antavo, Smile

Come up with a detailed list of the different products and services you need to run your business as well as the monthly and per-transaction cost of each of them. This will be important in understanding the impact of these services on your margins.

Matching your business model to your technology is essential, too. Certain website platforms are better suited for specific sales models.

Email marketing is another type of technology that should be carefully considered and matched up correctly with your business model.

Keep in mind that it takes, on average, 6-7 interactions with a brand before someone makes a purchase, so you need to keep using technology to get them back to your website.

As you explore the technology options and find out ways to draw potential customers in and keep them happy while they’re there, here are some key points to keep in mind:

• What you say about yourself and your products with your website content
• How you respond to questions on live chat and email support
• How to make use of chatbots
• How you connect on social media
• The information you send through email marketing
• What bloggers and influencers say about your brand
• How existing customers review your company
• How you advertise
• How you establish loyalty beyond sales

After you figure out your technology methods, you have to come up with a technology budget.

The business plan must also include the operations side of things. Determine who will be your manufacturer, secondary manufacturer, and shipping and fulfillment  provider.

When looking at supply chain costs and options, ShipBob  is an ecommerce fulfillment provider you can consider.

Financial Plan

When figuring out your financial plan, evaluating and pinpointing your startup costs  is essential.

The focus of the financial plan is how long it will take for you to make your money back. You also need to figure out if you need a business loan .

Traffic and conversion rates will help you determine how long it will be until you start making money back.

You’ll also want to use an income statement to detail financial information.

This section is used for financial projections, such as forecasting sales, expenses, and net income of the business. Ideally, you’ll want to create a monthly Excel balance sheet showing the following:

• Projected revenue:  First, come up with your projected number of units sold and then come up with your projected revenue (Projected Revenue = # of Units Sold * Average Sales Price).
• Fixed expenses:   these are expenses that are fixed no matter how much you sell. Typically, these relate to monthly SaaS subscriptions, employee salaries, or rent.
• Variable expenses  – these expenses change in direct proportion to how much you sell. Common examples include the cost of goods sold and credit card payment processing fees.

This helps business owners better understand what they need to achieve to hit their profit goals. In reality, projections are usually always off the mark, but it’s good to give yourself some measurable goals to strive for.

This section should aim to answer the following questions about your product offering:

• How much product do you need to sell per year to meet your income goals for the business?
• What are the margins on your product? If you sell one hiking shirt for $50, how much do you make after paying your supplier, employees, and marketing costs?
• What is the lifetime value of a customer?
• How much can you spend to acquire customers? If you conservatively project that the average customer will spend $300 over time on your shirts, then you can afford to spend an amount less than $300 to acquire that customer using the paid marketing channels described previously.
• Do you have any big capital expenditures early on that would require you to need to bring in investors?
• Can you improve gross margins by making bigger orders from your suppliers?

There are various acquisition channels that will help your traffic to convert including:

Your revenue plan will contain a 12-month revenue forecast plan to help you map out each month of earnings.

There are different business earning models you can go through to determine how much you can make with your business.

You want to calculate how much traffic costs. This all depends on the methods you use to gain traffic to your site.

As you determine what your profit might be with your ecommerce business  or ecommerce businesses, there are certain math formulas to use:

• The profit equation
• Break-even analysis
• Units needed to achieve the profit target

You should also consider how you will use fintech companies in your ecommerce business.

What are the key elements of an ecommerce business plan?

The main components of an eCommerce business plan include the executive summary, company description, market analysis, organization and management structure, product line or service, marketing and sales strategy, financial projections, and funding request, if applicable.

How do I create a budget for my ecommerce business?

Start by estimating your initial startup costs and ongoing expenses. Consider costs like website development, inventory, marketing, shipping, taxes, and any necessary licenses or permits. It’s also important to factor in a contingency plan for unexpected costs.

How do I find the right product to sell?

Research is fundamental. Look at market trends, customer needs, and competitor products. Use tools like Google Trends or social media platforms to understand what customers are currently interested in. Always consider your passion and knowledge about the product too, as this can drive your business forward.

How can I differentiate my product from competitors?

Differentiation can come from unique product features, superior customer service, better pricing, or a compelling brand story. Understand what your competitors offer and how you can do it differently or better.

Wrapping Up Your Business Plan

Careful planning is crucial to get your e-commerce business from the planning phase to the launch phase and to ensure its successful future.

Going through the exercise of writing a business plan will cement your own understanding of your business and your market. It will also position you to take advantage of lucrative opportunities while mitigating harmful threats to your business down the line.

Your turn! Have you written a business plan for your online store? Do you have anything to add? Tell us about it in the comments below!

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How to Write an Ecommerce Business Plan [Examples & Template]

Published: April 03, 2024

If you have a promising idea for an online e-commerce business , it’s important to create an e-commerce business plan to ensure your vision has enough stock to be profitable.

Having a business plan for your online store will help you define your target market, establish your monthly and quarterly sales goals, and increase the likelihood of long-term e-commerce success.

In this post, we’ll go over an online store business plan and how you can create one for your e-commerce startup. Let’s get started.

What is an e-commerce business plan?

An e-commerce business plan is a document that outlines your business and its goals, analyzes your industry and competitors, and identifies the resources needed to execute your plan. It also lists the e-commerce retailers you’ll use to distribute your products and the marketing strategies you’ll use to drive sales.

Whether a company operates as a startup or has years of operations and growth under its belt, an e-commerce business plan is essential for evaluating a business and determining areas of improvement.

An e-commerce business plan is essential, with increasing numbers of shoppers conducting business online. It's estimated this number has reached over 2 billion . An e-commerce business plan keeps you organized and is useful when seeking investors who need to understand your company.

So, let’s dive into some examples of e-commerce business plans and what goes into writing one using our free template .

Free Business Plan Template

The essential document for starting a business -- custom built for your needs.

• Outline your idea.
• Pitch to investors.
• Secure funding.
• Get to work!

You're all set!

Click this link to access this resource at any time.

E-commerce Business Plan Template

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Ecommerce Business Plan Template

Written by Dave Lavinsky

Business Plan Outline

• Ecommerce Business Plan Home
• 1. Executive Summary
• 2. Company Overview
• 3. Industry Analysis
• 4. Customer Analysis
• 5. Competitive Analysis
• 6. Marketing Plan
• 7. Operations Plan
• 8. Management Team
• 9. Financial Plan

Whether you are planning to start a new ecommerce business or grow your existing business, you’ve come to the right place to create your plan.

We have helped over 10,000 entrepreneurs and business owners create business plans and many have used them to start or grow their own ecommerce company.

Below are links to each section of a sample ecommerce business plan to help you write your ecommerce business plan:

Next Section: Executive Summary >

Ecommerce Business Plan FAQs

What is an ecommerce business plan.

An ecommerce business plan is a plan to start and/or grow your ecommerce business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.

You can  easily complete your ecommerce business plan using our Ecommerce Business Plan Template here .

What Are the Main Types of Ecommerce Companies?

An Ecommerce business can really be anything that is able to be sold on the internet, it is an online business. Ecommerce companies range from virtual clothing websites, furniture store websites, electronic devices and accessories, toy stores, etc. These companies can have a warehouse where they store and ship their own inventory or utilize a dropshipper who is a third party company who receives the order straight from the website, fulfills the order, and ships directly to the consumer.

No matter what type of online business you will operate, you will need to know how to make an ecommerce business plan. An ecommerce business plan template is key to creating a solid business plan.

What Are the Main Sources of Revenue and Expenses for an Ecommerce Business?

The primary source of revenue for an ecommerce company is the products that are sold on the website.

The key expenses for an ecommerce company are the costs to maintain a warehouse and shipping costs. There are also payroll costs that need to be factored in for the personnel who will be handling all product fulfillment and shipments. If utilizing a dropshipper, a key expense is the fees that will need to be paid to the dropshipper for fulfilling the orders and shipping directly to the consumers.

How Do You Get Funding for Your Ecommerce Company?

Ecommerce businesses are most likely to receive funding from banks. Typically you will find a local bank and present your business plan to them. A major source of funding for an ecommerce company are angel investors, crowdfunding, or funding from friends and/or associates.

An investor will want to see a solid business plan complete with a strong financial plan (income statement, balance sheets and cash flow statements).  It should also include a comprehensive marketing strategy, details of your business model, an overview of your management team and  market research on your target market. You can quickly complete your plan using our Ecommerce Business Plan Template here .

Where Can I Get an Ecommerce Business Plan PDF?

You can download our free Ecommerce business plan template PDF here . This is a sample Ecommerce business plan template you can use in PDF format.

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As the saying goes, “A goal without a plan is just a wish.” So, if you wish to build your own eCommerce empire, having an eCommerce business plan is crucial to your success.

Why Should You Continue Reading This Article?

But maybe you have no idea where to start. Of course, you don’t want to leave out something important. In this article, we’ll show you how to build an eCommerce business plan and discuss how to write it in a well-crafted, simple way from scratch, for your eCommerce small business and what are the key elements that should be included in it.

Let’s get started!

Why You Need an eCommerce Business Plan

Abraham Lincoln once said, “Give me six hours to chop down a tree, and I will spend the first four sharpening the axe” So, planning is almost everything you should start with.

Although it can be hard work to put together a comprehensive eCommerce business plan, it’s such an important step for the below-mentioned four reasons:

• Establishing a Clear Roadmap:  Well-written strategic planning will help you set clear goals and set an action plan to reach them. It will also help you to set priorities and realistically estimate the time and effort needed to achieve them.
• Being Ready for Any Sudden Changes:  Change in the eCommerce business world is happening quicker than ever before. And this increases the value of planning. Having a data-driven business plan gave managers a dashboard to work with navigated sudden change.
• Securing Funding: If you are looking for a loan or an equity investment for your startup, getting a business plan document right is essential because an organization that will provide the money wants to make sure that you know what you are doing and have a clear path to profit.
• Avoiding Costly Mistakes: If you are considering setting up a small business with limited resources, having a startup business plan helps you know exactly what resources are needed to avoid wasting resources down the drain and to make the most of them.

Before You Start Planning: 3 Key Questions to Answer

To build a well-written online business plan sample, you need to answer the following questions:

• What Are You Selling?  Are you selling physical products (i.e apparel, home appliances, etc.), digital products (i.e online courses, ebooks, software, etc.), or services (i.e marketing services, consulting, car repair, etc.)?
• For Whom?  Do you sell to individuals (B2C) or organizations, corporations, and non-profits (B2B) or are you are a part of a marketplace acting as a broker just like affiliate marketing?.
• Who Are Your Suppliers? Do you manufacture your products in-house, or outsource a third-party manufacturer? Do you partner with a dropshipping manufacturer or do you depend on wholesale?

With great data comes a great business plan. Answering this line of questioning will give you an initial overview of what your business is and it’ll be like a starting point.

How to Structure a Business Plan for Your Online Store

Let’s agree from the start that the business plan will not be perfectly completed on the first try. It will continue to evolve as you create each of the planning stages and you’ll be making edits along the way.

For an eCommerce business plan example, there are six basic sections it should include, Let’s delve deeper…

Let’s delve deeper…

1. Executive Summary

Any e-Commerce business plan should start with an executive summary of just one sheet summarizing each section of your business plan. Although it is placed at the beginning, it should be the last section to be written.

The executive summary is the first thing your prospect investors would read, and it creates the first impression of your project. So, make it simple, easy to understand, and attractive.

The executive summary should include:

• Business ideas presentation
• Business model
• Products and services
• Target audience and target market
• Management team
• Success factors or the points that differentiate your company
• Financial strategy

2.  Company Overview

This is the next section that includes detailed information about your business and identified the competitive advantage of your online store. It covers some features such as:

• Brand Name and Founder’s Name: Your online store name and who is behind it.
• Brand Traits: List just 3 to 5 words that describe the brand that you want your online store to be identified with.
• Domain Name: It’s the URL. It should be short, simple, memorable, and doesn’t include numbers.
• Company Type: How your business operates.
• Value Proposition: It’s a brief statement that shows how clear your idea is.
• Mission Statement: The reasons behind your business’ existence.
• Vision: The goals that you want to reach long term. They must be realistic and ambitious so they can be motivating.

3. Market  Analysis

Conducting market research around your eCommerce small business idea is essential. It tells you whether or not people will buy what you’re selling.

Market analysis is broken down into 3 main sections:

A. industry analysis:.

Industry analysis outlines the industry size facts and statistics bode well for your eCommerce business. It answers questions like:

• What does the market look like for your industry overall?
• Has it grown or changed over the years?
• Are there any expectations of growing up or slipping down in the future?
• Are there factors that could impact its growth?

Industry analysis is likely to be one of the toughest parts of your eCommerce business plan, but fortunately, research and white papers are abundant in almost all industries, besides free tools like Google Trends .

B . Market Segment:

The market segment or audience segmentation helps you to create your “Buyer Persona” which represents your target audiences’ various demographic sets (gender, age, geography, education, income level, ethnicity, etc.). The market segment includes both your target market and niche selection.

It’s important to provide an overview of your niche, whether there’s a micro-niche included, and why you chose it.

C. Competitive Analysis:

Competitive Analysis provides an overview of who is your market leaders are and direct, indirect, and potential competitors. It also identifies your competitors’ key strengths, weaknesses, opportunities, and threats, focusing particularly on where you can defeat the competition or add unique value to your business.

Creating a comprehensive competitive analysis includes 4 key phrases that are:

• Identify Your Competitors
• Select a Competitive Analysis Framework
• Collect Data on Your Competitors
• Write Your Competitive Analysis Report

4.  Marketing Plan

By now, you’ve covered almost all your company-related aspects, your customers, and your competitors as well. It’s time to talk about how you’re going to reach your customers and drive traffic to your eCommerce website.

The marketing plan describes the planned promotion strategies, business growth strategies, pricing strategies , sales strategies, and how much can you afford to spend on your marketing efforts. To come up with a well-defined marketing strategy, you need to deeply know your customer inside out.

It’s important to keep in mind that every potential customer is different, and there are many organic and paid marketing techniques that you can use to reach each of them. From SEO, social media, content marketing, and email marketing to influencers, these proven techniques will surely  acquire customers and drive traffic to your online store .

So, this stage is all about defining:

• Which marketing channels are best for you to reach your customer?
• How much can you afford to acquire customers to your online store?

5. Operations Plan

Operational planning reflects the task flow of your eCommerce store and how they’ll be divided. It includes your daily tasks as an online store owner. Some basic things should be established, such as your work schedule, your daily tasks timetable, your location, and your product stock.

Your tasks will include:

• Offering support
• Managing the stock
• Managing returns
• Negotiating with suppliers
• Dealing with unforeseen events
• Promoting your store
• And much more

List all of your daily tasks and how your routine will be to make sure that everything in your business plan will be under control. If you are a startup and you’re the only person in charge, it’d be hard to manage all tasks. So, it’s important to have initial planning on paper, and then make small modifications down the line to hire a staff and management team.

6. Financial Plan

For many people, this is the most difficult part of a business plan. However, it’s extremely important. It outlines the major costs for an eCommerce business that include the cost of goods, internet connection fees, salaries of the staff, etc.

If you’re seeking to get outside funding, your financial statement should contain the following documents:

• Summary of Funding Requirement: It’s an outline showing why you are applying for a loan, the cost for raw materials and operational machines, and how much money you need.
• Use of Funds Statement / Income Statement: It shows how profitable your business would be during a given period and describes how you plan to use the funds you’ll get.
• Business Budget: This displays cash inflow and outflow statements over a specific period of time.
• 3-Year Profit and Loss Projection: It’s assumptions that are stated clearly and in detail to communicate your vision of the company’s future and how you anticipate achieving that vision.

5 eCommerce Business Plans’ Mistakes to Avoid in 2022

As for eCommerce owners ( whether it was for fashion, services, etc.), there are some methodologies they use to approximately estimate future turnover, profitability, and more.  But unfortunately, most of these estimations and expectations are frequently distant from market reality.

ExpandCart gathers the most common mistakes that usually happen when you put an eCommerce marketing plan into work, Let’s show you around! 

Mistake #1  |  Selecting the Improper eCommerce Platform

Whether you’re just getting started with your eCommerce shop or have been running one for a while, a not-suitable eCommerce platform can boost your eCommerce business plan or awfully put it to an end! 

After you’ve created a sample business plan for an eCommerce startup, you’ll need to think about several things when selecting an eCommerce platform, including:

• Your financial situation
• Whether you prefer a template or bespoke design, we can help.
• What type of experience do your consumers want?
• What items do you intend to sell?
• How do you intend to grow your company?
• What tools your platform needs to integrate with?
• How much control do you desire over your website?

The last thing you want is to pick a platform that restricts your company’s development, doesn’t interact with your existing systems, or doesn’t provide the amount of control and flexibility you want.

An improper eCommerce platform can result in a variety of problems, including income loss, decreased conversions, less traffic, security difficulties, bad design, and more. This major error might force you to spend even more time, money, and effort modernizing your platform or moving to a new one entirely.

Take your time while deciding on the best eCommerce platform for your online eCommerce as this will affect the whole performance of your eCommerce business plan. 

Mistake #2  |Skipping Environment Check

Before drafting an eCommerce business plan to launch or boost your e-commerce website, it’s a crucial step to start assessing the viability of your ideas before anything!

And here, we don’t mean broad market studies, but rather a comprehensive test using a limited version of your site, that will assist in ensuring in the field that you are gaining traction in your market. You must be able to tie your business strategy to the fact that you have already made your first sales even before you daft your eCommerce business plan. 

Aside from the checking and validation component, an initial test will help you to get useful feedback from your consumers and discover for yourself the major roadblocks or places for progress in your business.

You’ll be in a better position to carry out your company plan and generate realistic and plausible financial projections once you’ve completed it.

Mistake #3 | No Clear Brand Message or Identity

A good product alone won’t perform as good branding! 

Don’t fall into the trap of believing that your things will sell themselves. To build a successful business, you’ll need to develop a strong brand identity that is both approachable to your target audience and favorable to viral brand awareness. If you’ve done your research, you should have a good notion of what your target audience wants and how to communicate with them. Then it’s only a matter of maintaining a consistent and firm message.

A strong brand identity boosts client loyalty and your chances of gaining global brand recognition.

Mistake #4 | Shallow Website Content 

If your eCommerce business relies on organic traffic to attract clients, then the material on your website should be crafted with the user and SEO in mind.

Many organizations make the mistake of considering content as an afterthought, failing to see that each piece of content represents a chance to increase traffic and convert clients.

You need to provide content that is relevant to your target audience, optimized for search engine traffic, and entices consumers to buy your items, from your homepage to your product descriptions.

Investing in SEO and CRO-friendly content is worthwhile, whether you engage with an SEO service or do it yourself. This entails using the correct high-quality keywords for your niche and crafting material that is designed to convert.

Mistake #5 | Mistargeted Audience 

What else could you possibly require? You have items, a company strategy, and a website. Unfortunately, having an offer and a venue to pitch it isn’t enough to be a true eCommerce success.

One of the most common blunders a business owner can make is failing to precisely define their target demographic and spend time learning what makes them tick. You’ll need to do some serious market research to make sure that:

• Your target audience has a genuine necessity for your product. 
• You know how to express your offer in a way that they will comprehend. 
• You may create a marketing plan that prioritizes your target audience.

Identifying and specifying your target audience can help you develop an atmosphere that they will remember and a brand message that will tempt them to buy and re-buy, and hence, a successful eCommerce business plan! 

Final Notes

We are living in a world of fast-paced digital transformation. Almost all businesses are thinking of building a strong online presence. Being prepared and having a well-crafted business plan for your dream eCommerce website helps you focus on what exactly you want your business to be in the future and provides a map of how to get there in no time.

Remember! Creating your own eCommerce business plan won’t be that easy, but success comes to those willing to put in the work and if you did it right, you will witness a great increase in sales and revenue . You can seek help from experts who can help you plan your business effectively.

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What is an E-Commerce Business Plan

A business plan overviews your e-commerce business today and lays out your growth strategy for the next five years. It outlines your business goals and your strategy for achieving them. It is a written statement that describes your business' structure, operations, and what you believe the future holds for a successful e-commerce business. In other words, a written statement that describes your business goals and the methods you'll use to achieve them. It should include your business's structure, products or services, clients, growth prospects, and financials. Writing a  business plan for e-commerce  may seem difficult at first, but it will save time and bucks in the long run by better preparing you for the problems and possibilities that first-time entrepreneurs will face.

Starting an e-commerce business will be an exciting experience if you are well-prepared and avoid diving headlong into anything without first establishing a robust, fail-safe business plan.  

A comprehensive e-commerce business plan should include:

• Executive summary
• Company description
• Market Research
• Organization and management
• Service or product line
• Marketing and sales
• Funding request
• Financial projections

When to Use a Business Plan for E-Commerce

You'll need a business plan if you're trying to start an e-commerce business or expand your existing one. A  business plan for e-commerce  will help you raise funding if needed and plan the expansion of your e-commerce business to increase your chances of success. Your e-commerce business plan is a living document you must update annually as your business grows and changes. 

Nevertheless, e-commerce is a thriving industry, which makes it very competitive. To keep up and thrive in this environment, you need an  e-commerce business plan . It will help you keep up with your competition, create intelligent methods, and make sound business decisions.

Why an E-Commerce Business Plan Template is Important

A not-so-perfect  e-commerce business plan  can be nothing short of a disaster if it isn't handled correctly, from outdated returns policies to a shortage of delivery fleet. On the other hand, a well-made business can help you achieve your business vision because it will help you have a proper budget, a good marketing plan, a well-managed team, and carefully designed policies. It can help you develop clear business strategies and goals, and clarity can help you run your business more efficiently.  

Here are some of the importance of an e-commerce business plan template :

• It helps to create an effective strategy for growth
• It helps to determine your future financial needs
• It helps to attract investors and lenders

How to Write an E-Commerce Business Plan

Below are the nine essential strategies you need to make a successful  business plan for e-commerce .

Executive summary of E-Commerce Business Plan

The executive section of your  online e-commerce business plan  summarizes your business idea. It is the first page of your business plan, and, when written correctly, it can help you win an investor's confidence and, eventually, get funded. It consists of the following sections: Business Overview, Mission Statement, and Financial Highlights.

Company description of E-Commerce Business Plan

This section would provide an overview of all your businesses, including, what your business stands for, your business history, A detailed description of your product or service range, and Your web design.,

Market analysis of E-Commerce Business Plan

A marketing plan is a must for any business; it not only lets people know about your existence but also serves as a reminder to remind them regularly. A strong marketing plan would not only get you noticed; it would also be memorable. It would include the following segments: Target Market, Market segmentation, Market Positioning, and Advertising strategy.

Organization and management of E-Commerce Business Plan

A sound system is vital for an e-commerce business since it only operates on good structure and management. This section includes the roles and responsibilities of different people at different levels and a development tracking system broken down into the following sub-segments: Roles and responsibilities of various individuals and Performance reports.

Service or product line of E-Commerce Business Plan

If you already have a product line in mind, how do you research specific products? You need high production in a growing niche to succeed in online commerce. What other goods are you planning for the future? After you've sold a few pairs of shoes, you might be able to use your contacts to sell belts and shirts. Knowing what you'll include in each section gives you a better idea of your main product and how other related products will go well with it. You would have everything ready to go at any time by working with the pricing section in your  e-commerce business plan template doc .

Marketing and sales strategies of E-Commerce Business Plan

Marketing is the center of every activity in your company, and your marketing activities must correspond with its business model. If you have a website but don't promote it, nobody will visit it, and even if the products are of the highest quality, no one will buy them unless they are familiar with your products. For an  e-commerce business plan PDF , you must first gain a thorough understanding of your target market.

Funding request of E-Commerce Business Plan

A section in your business plan allows you to ask for the necessary amount, but you must note the timeframe in which you will use the funds at all times when you write the request. The amount of money requested can change depending on the age of your company. If your company is new, you will have to provide more information than any older company. Any business that is under seven years old is considered a startup company. This criterion, however, could differ depending on the location and industry.

Financial projections of E-Commerce Business Plan

A financial plan is essential in the early stages of a business because it helps prevent your business from failing due to cash flow and funding challenges. It is a significant determinant of your business's growth and success. It would include the following subsections: Cash flow management, Funding sources, and Forecasted profit.

Appendix of E-Commerce Business Plan

Your full financial projections are part of the appendix of your  e-commerce business plan sample PDF , along with any supporting documents that make it stronger, such as agreements you've negotiated with developers, manufacturers, and employees.

FAQ About the E-Commerce Business Plan

1.What is an online e-commerce business plan? 

An online e-commerce business plan helps companies remain focused on a predefined set of objectives, and they also assist business owners in presenting their operations to lenders and investors. Your e-commerce business plan is a roadmap for a business that operates online.

2.Can I convert the PDF template to an e-commerce business plan template doc? 

Yes, by using the PDF Agile Tool convert your plan to  an e-commerce business plan template   in Word.

3.Should I use an e-commerce business plan template?

Yes, you should if you want to create an  e-commerce business plan  to set business goals and get funding for your profession.

4.What are the six types of e-commerce?

• Business-to-Business (B2B)
• Business-to-Consumer (B2C)
• Consumer-to-Consumer (C2C)
• Consumer-to-Business (C2B).
• Business-to-Administration (B2A)
• Consumer-to-Administration (C2A)

E-Commerce Business Plan Sample PDF for Download

If you need to edit your downloaded  e-commerce business plan template  quickly and easily, try using PDF Agile. It offers password protection, e-signature, and react information features to safeguard all your sensitive documents.

A good business plan can spare you from experiencing significant setbacks and loopholes in your e-commerce business. Everything from cash crunches to a lousy management system is avoidable with a plan. But before your project can be fully operational, you must first begin writing one. Then, you can copy and paste this  e-commerce business plan template  into your own, edit it to include all the required information, and download your  e-commerce business plan sample PDF  or doc file after getting started with Upmetrics.

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Ecommerce business startup guide: checklist & business plan | ecommerce ceo, e-commerce & retail.

Are you one of the ambitious eCommerce startups and want to have your own business someday? Or even like to be your own boss and start whatever business you are passionate about?

The first thing you have to do in order to start your startup company is to make a business plan , so it is important to know about business plan writing and the rest follows.

This guide will be your blueprint; you should take a look at it before launching your startup eCommerce company.

Before Launching Your eCommerce Business

There are a variety of business models out there; however, they might not be “the one” for everyone. At first, you want to save time and energy besides finding the perfect business model that suits you best.

You do not need to rush into a specific business model because someone said this was best for them, as mentioned earlier, what fits others might not fit you.

However, this guide covers the top 5 popular eCommerce business models, research them and take a  good look just to make up your mind, and they are:

• Research Private Label Business Ideas
• Research Amazon Affiliate Marketing
• Research Dropshipping
• Research Print On Demand
• Research Selling Digital Products

Related Guide: The Guide to Dropshipping 101: Ecommerce Without Inventory

Create Your Ecommerce Business Plan

So, you have got your business model after you’ve researched the, what’s next?

Here are the main points to know that you should bear in mind while building your eCommerce startup;

• Research Product Ideas and Target Markets: Once you have this you can implement various business models.
• Competitive Market Research: To do this you have to have an idea about your product and market niche when you do, you need to know who your competitors are.

For this one, KW Finder can help you find accurate results for the most difficult keywords in the market.

• Initial Brand Development: You can use your competitive market research to create a brand that establishes points of parity and points of differentiation.
• Set up a Business and Complete Plan: It is time to make your brand official after you got it established.
• Email Marketing Automation : You need to consider this phase – adding email automation to your marketing; this is the phase where most people selling products fail.

Download the full guide and get a full eCommerce Business Plan for your eCommerce startup

The Table of Content of “Ecommerce Business Startup Guide: Checklist & Business Plan”:

• Before you start
• Research product ideas and target markets
• Competitive market research
• Initial brand development
• Set up a business and complete plan
• Plan your website content and launch
• Email marketing automation (As needed)
• Ecommerce business plan
• Marketing and operation plan
• Financial plan
• Additional notes

Number of Pages:

Affiliate marketing, dropshipping, ecommerce business, ecommerce market.

Ecommerce CEO

• What should I sell online?
• What business models are legit?
• Should I sell on Amazon or my own website?
• Should I use Shopify or WooCommerce?
• How will I get traffic and sales?
• How will I manage fulfillment – Amazon or ShipBob?
• How do I avoid bad business investments?

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Nature's Candy

Executive summary executive summary is a brief introduction to your business plan. it describes your business, the problem that it solves, your target market, and financial highlights.">, opportunity.

The modern world brings knowledge about the human body and the convenience of having things sent to one’s home. Why should that only be an option for people with more income? We will make sure that everyone has the option of health and convenience. 

Nature’s Candy’s mission is to provide the finest in natural supplements using the Internet to lower the consumer’s cost.  We exist to attract and maintain customers.  When we adhere to this maxim, everything else will fall into place.  Our services will exceed the expectations of our customers.  

The nutritional supplement market is a semi-mature market characterized by high-growth rates, medium barriers to entry, and a few large competitors.  Despite the competition in the market, many companies have reported annual growth levels of 30%.  The market leaders are as follows:

• GNC (General Nutritional Companies, Inc.): This company is a nationwide specialty retailer of vitamins, minerals, and sports nutrition supplements.  With over 3,000 stores, GNC generated $1.19 billion in 2000.
• Nature’s Sunshine Products, Inc.: Nature’s manufactures and markets a variety of health supplements.  This multi-level marketing company had 2000 revenues of approximately $370 million.
• Rexall Sundown, Inc.: Rexall develops, manufactures, markets and sells vitamins, nutritional supplements, and consumer health products through retailers, independent distributors, and mail order.  Rexall had 2000 revenues of approximately $370 million.
• International Vitamin Company, Inc.: IVC manufactures, packages, sells, and distributes private label vitamins and nutritional supplements to drug stores, supermarkets and health food stores.  IVC had revenues of $107 million in 2000.

The primary channels of distribution in this market are:

• Mass market retailers (Fred Meyer, Rite Aide).
• Direct Sales organizations.
• Health Food Stores (GNC).
• Mail order catalogs and the Internet.

Competition

Within the mass market retailer channel, the three main primary vitamin and supplement product categories are national brands, broad-line brands, and private label brands.  The national and broad line brands consist of 60% of the domestic market, which the private label brands account for the remaining 40% of the market.

Expectations

In the next three years Nature’s Candy intends to create an icon e-commerce brand through laser-focused marketing and will grow and eventually make a profit by the second year 

Financial Highlights by Year

Financing needed.

We will be starting with $80,000 from founders: 

Quack $45,000

Stewart $35,000

Problem & Solution

Problem worth solving, our solution, target market, market size & segments.

The market for vitamins and nutritional supplements has grown to over $6.5 billion annually. Herbal sales alone are growing by 20% per year.  This market is lead by the aging Baby Boomer who is concerned with his/her mortality.  Also, there has been a paradigm shift of perception of nutritional supplements.  Homeopathic and naturopathic products are seen as normal.  In addition, positive medical results from major studies have further legitimized these products.

4.1 Market Segmentation

A significant trend in America, and abroad, is that people are taking a more proactive interest in their health.  This is exemplified by the increase of health clubs and health club memberships.  People are looking to avoid invasive surgery and powerful pharmaceuticals. People are taking an active role in the maintenance of their health and practicing preventive medicine.  Naturopathic medicine promotes the diagnosis, treatment, and prevention of human disorders through the use of non-invasive, non-pharmaceutical products and practices.  In 1993, the United Stated government recognized this trend when it established the Office of Alternative Medicine.

Besides the general development of naturopathic medicine, the aging of the American population is a significant trend driving the use of naturopathic and homeopathic health supplements.  The Baby Boomers are now reaching middle age and mortality is becoming a focus.  This demographic segment, which is comprised of 80 million people, represents over 50% of our county’s discretionary income.  It is reasonable to believe that this wealthy market segment will continue to grow the sales of naturopathic products.

Another global trend is the emergence and popularity of e-commerce.  Brand-focused Web retailers that can provide quality products, customer service, information, and the intangible, emotional buy-in by the customer are becoming hugely successful.  E-commerce retailers have an advantage in that "Unlike traditional retailers, Web-based sellers are not slowed by the friction of store growth and local marketing"  (J.W. Gurley, Fortune, 1/11/98).  In addition, e-commerce companies do not have the excessive overhead of a traditional brick and mortar retailer.  As seen by the recent success of Amazon.com and Gap.com, consumers are comfortable buying online and will pay for convenience.  Experts predict Web sales to grow to $12 billion by 2003.

This enthusiasm about the Internet is not irrational but grounded in reality in light of the recent market crash of Internet retailers.  The recent Internet crash was based on too-easy access to capital invested into retailers and other dot-coms without reasonable business plans or revenue models.  Regardless of the recent fallout, the Internet is a very efficient marketing and distribution model that if done right, significantly decreases costs of serving the consumer. Nature’s Candy will harness these efficiencies and will grow intelligently unlike other .dot-coms that became dot-bombs.

Current Alternatives

National Brands Examples:  Centrum, One-A-Day. Generally do not provide a full line of vitamins or other supplements. The product formulas are conservative and generic in nature.

Broad-line Brands Examples:  Rexall Sundown, GNC’s Nature’s Fingerprint, Country Life. Full lines of produce under one brand. Manufactured by company. This is the market segment where most of the product development and innovation occurs. Stronger potencies and cutting edge ingredients. Highest price.

Private Label Products Examples:  NatureMed. Under retailer’s name. Smaller line of products than broad-line brands. Manufactured by a third party. More conservative potencies than broad line. Tend to be the cheapest.

Our Advantages

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Nature’s Candy’s other competitive edge is superior customer service.   The mantra of the customer service department is to serve the customer in any way required.  Customers that call in with problem/issues will be amazed at the amount of personal attention they receive and how quickly issues are not only resolved, but significantly improved.  This will be a powerful asset.

Keys to Success

Nature’s Candy’s keys to success are:

• Web design.
• Product quality.

Marketing & Sales

Marketing plan.

Nature’s Candy  is focused on the merging/redefined Internet marketplace.  The users will be Baby Boomers, which represent approximately 50% of the discretionary income currently in the United States.  They are looking for proactive, non-invasive, and non-pharmaceutical ways to stay healthy as they age.  Nature’s Candy can bring these people cutting-edge products coupled with convenience and service.

The long range goal of Nature’s Candy is not only to dominate the naturopathic and homeopathic supplement market, but to create an icon brand.  Initially the company will:

• Engage in Web-based marketing for the next year to generate awareness of the company and product information.  Because Internet based advertising has declined in recent quarters, the prices for advertising have consequently significantly dropped making the expenditure more cost effective.
• Engage in outdoor advertising providing general awareness to the public at large and direct individuals to the company’s website.

Nature’s Candy will process 90% of it’s sales online through a secure socket layer (SSL), an secure Internet connection.  All orders will be charged to Visa, Mastercard, or American Express.

By ensuring that the website is easy to navigate as well as simple to order from, Nature’s Candy will be ensuring that people who make it to the website will end up purchasing something.  This last point is key.  Research indicates that too many sites that are not easy or intuitive lose customers who migrate through the site, often putting products in their basket, yet leave without purchasing anything.

Nature’s Candy will market and sell private label (manufactured by a company that places the retailer’s name on the packaging) naturopathic homeopathic dietary supplements to individual consumers via the Internet.  These products will include ginseng, ginkoba, and various antioxidants.  After year one additional products will be offered.

Milestones & Metrics

Milestones table, key metrics.

Our key Metrics are

• # of views on the website 
• # of visitors 
• # of tweets and retweets 
• # of returning customers 
• inventory turnover 
• customer favorite products 

Ownership & Structure

Nature’s Candy is a privately held Oregon corporation.  Quack Vendor will be the majority owner.  The company intends to recruit a sophisticated team of owner board members. The board members will be granted shares of stock to provide an incentive for their performance on the board.

Management Team

Quack Vendor, president and founder.  Quack worked for Arthur Andersen until qualifying for his CPA credential.  He left Arthur Andersen to become operations manager at Nautilus Footwear, a niche footwear start-up.  His duties included general office management, finance manager, and jack-of-all-trades.  Quack has gained useful insight into the supplemental industry through in-depth conversations with his father, a naturopathic physician.  He received his BS from the University of Oregon.

Stewart Wachit, technology officer.  Stew worked at Imagina for two years where he specialized in C++ and HTML/XML programming.  Stewart left Imagina to become a Web database developer at Systems Management Incorporated, specializing in ColdFusion and JSP.  He received his BS from the University of Pittsburgh.

There are important gaps as follows:

• Customer service representative/manager.
• Distribution/warehouse manager.
• Advisory board.

Personnel Table

Financial plan investor-ready personnel plan .">, key assumptions.

Our Key Assumptions: 

• The new trend is people are focusing on their health 
• Vitamins help prolong health 
• People need price accessible Vitamins 

Revenue by Month

Expenses by month, net profit (or loss) by year, use of funds.

Nature’s Candy will incur the following start-up costs

Legal$1,000

Stationery etc.$200

Web Development$10,000

TOTAL START-UP EXPENSES$ 11,200

Sources of Funds

We will be getting $80,000: 

Quack$45,000

Stewart$35,000

Projected Profit & Loss

Projected balance sheet, projected cash flow statement.

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