Ecommerce Business Plan

Your Value Proposition

A crisp, short, value proposition is a good gauge for the clarity of your idea. This section should be written in a way that it would seem like you had a good minute to explain your business to a customer or even a potential investor. Practice this over and over again until you are happy with it. Make sure you use it in your ecommerce store as your company description. If you are searching for a way to start a hiking company, your company description should be clear, interesting, and has your strengths against other companies. Take note that sensory words are also very important.

Figure Out Your Business Model

Before diving into the weeds, it would be a great idea to develop a framework of your business model in the beginning. It would be ideal to go through different sections of your business plan and conduct an extensive research so you could definitely make the tweaks to your business model. There’s no need to make this one perfect. There are several online business models that could be employed and there are different ways to sell your product on the internet.

What do you sell?

  • Physical products: Shoes, home goods, clothes
  • Digital products:SaaS, ebooks, softwares, e-course
  • Services: Home cleaning, consultation service

To whom are you selling?

  • Business to Business: You sell to organizations, non-profits, and corporations instead of to individuals
  • Business to Consumer: You sell to consumers instead of businesses
  • Marketplace: You become a middleman as you bring the businesses and customers to a single website

How can you source your products?

  • Dropship: You partner with dropshipping manufacturers. They make your products, they package it, then ship it to your customer while your company takes care of the customer relationship.
  • Manufacture in-house: your products are service in-house or you make your products
  • 3rd party: You outsource the manufacturing to a 3rd party manufacturer.
  • Wholesale: You buy the services and goods from companies in bulk and resell them on your online store.

Market Analysis

Fact to take note of: there wasn’t a successful e-commerce entrepreneur that didn’t understand his or her target market ever. This is why this remains to be one of the most important section of this business plan. It would force you to understand the industry where you are operating in, the industry outlook as a total, the competition, and the demographic of your target customer. Before starting on this section it’s important that you research on your target market first.

Industry reports are some of the good places to start. Find the recent industry reports on your market choice, this would give you a good sense of how much growth the industry would experience. The valuable information you get would be the one you would use to guide your strategy. But remember that there’s only so much you could find online. It’s important that you go to nearby stores and sell products that are similar to yours and you could try interviewing the store representative. Since this store rep has talked to hundreds of customers this could lead to a lot of customer insights. This insights is amazing because it could turn into really good business opportunity. Some questions you could ask the rep would be:

  • What are the best selling products?
  • Which ones sell the worst?
  • Find similar products to yours and ask about their favorite features.
  • How much are people averagely willing to spend for them?
  • Does these products receive repeat orders?
  • Do you get a lot of people who buys last minute?

Make sure that you also create a spreadsheet that has all your competitors.columns that you should have would be:

  • Competitor name:
  • Website:
  • Price point:
  • Description:
  • Key Features:

You should also figure out what the competition is missing, the gaps, and in which areas could you add more value. Insights that you find from this section could then help you alter your business model for the better.

Google Analytics allows you to gain a good sense of the demand your product has and whether the trend is still going up or down. This is great for general idea, just make sure you don’t bank on it. If there are trade shows near your area, create connections with people in your industry and this would stand as a shortcut from hours of reading on the internet. It’s also another good opportunity so you could talk to competitors, meet the manufacturers or suppliers, and understand where things are heading better. When you are done with searching for the relevant industry, the next thing to do is summarize what you find and answer the following questions:

General Industry:

  • What’s the size of the overall industry?
  • How big is the specific sub-industry where you plan to operate?
  • Where did the historic growth come from?
  • Why is this the best time to get into the market?


  • What are the sub-segments which are poised for growth in the future?


  • How crowded is the competition of this product?
  • How is your competition distributing their product?
  • What’s missing?


  • Who are your target customer?
  • Are the consumers comfortable with buying from your product category online?

Marketing and Sales

So now is when we know you already have really great business ideas and it’s part of the growing market. Now the next thing you should plan is how you’d drive traffic to your eCommerce website and get interested audience to buy from you. You should also plan your budget by now. If you want to come up with a marketing strategy, you have to know your customer inside and out. Questions you should be able to answer would be:

  • How old are your customers?
  • Where is your customer from?
  • What’s the population base of your customer?
  • What is the educational level of your customer?
  • What is the income level of your customer?
  • What is the pain points of your customer?

When you have everything you need to know about your customer, you can start focusing on the marketing strategy. Which channel should be used to attract attention? Here are some of the key marketing channels:

  • PPC (Pay per click)- this involves Google Shopping campaigns managing your product data feed.
  • Affiliate sale network- this allows other websites and blogs to sell your products for a revenue or incentive.
  • Social Media- you need to decide which platform you would be using.
  • Search engine optimization- promote through amazing content so people could organically search your products.
  • Blog Networks- this could be paid or organic and it could even be through affiliate marketing.

Make sure that you come up with a content roadmap that lists the next 15 articles you would to create and your strategy to create those content. How would you be persuading people to purchase your product when they visit your online store? Finding the perfect mix of tools would depend on your customer segment 100%, it also depends on your product type. If a SaaS is targeting millennials then this would require an entirely different marketing strategy compared to an eCommerce physical product that would target baby boomers. When you are a new business there’s no need to have a lot of data on your customers purchase habits, it’s better to be more conservative with your assumptions in calculating the LTV. knowing this would let you know how much you could spend on marketing and still be able to earn really well.

Choosing the Right Technology

There are a lot of SaaS and technology out in the industry, it’s important that you understand the different moving parts and the diagram of how they are integrated with each other.

  • Shopping carts include Volusion, Shopify
  • Payment Processors include PayPal and Stripe
  • Fulfillment Center includes Shipwire and Amazon
  • Social Media planning tools include Buffer and ViralTag
  • Accounting include Quicken and Xero
  • Newsletter include MailChimp
  • Customer loyalty programs

Have a detailed list of the products and services that you would need so you could run your business and include the monthly and per transaction costs. This is important to understand because it would have a great impact on your margins.

Products and Services

If you want to succeed it’s important to have products that are trending upward and are growing. If you would be using existing products you need to come up with specifications that are detailed. Make sure that you have every detail such as sizes, materials, quantity, etc listed. You should also include future product pipelines in this section.

Financial Management

This section is where you should be forecasting the expenses, sales, and even the net income of your business. You should make something like an excel that would show:

  • The projected revenue: the projected # of units sold, projected revenue. (projected revenue equals the # of units sold * average sales price)
  • Fixed expenses: the expenses that are fixed no matter how many you sell. These are related to the monthly SaaS, rent, salaries.
  • Variable expenses: expenses change in direct proportion of how much you sell. Examples include cost of goods sold and payment processing fee.

This would help the business owners to understand what they would be needing in order to achieve their profit goal. These are usually off the mark, but it would be good to have goals you would strive for. This section should be able to answer the following questions:

  • The number of products you would need to sell per year so you can meet your income goal.
  • What are your margins? How much do you make minus the expenses?
  • What is the LTV of your customer?
  • How much do you need to spend to get a customer?
  • Do you have big capital expenditures that would need investors?
  • Can you improve gross margins?


Planning carefully is very important when you want to go into the world of e-commerce businesses. You have to be careful right from planning, launching, and to make sure that it would eventually be successful. When you go through the exercise of writing a business plan, you would learn and understand your business as well as your market on a deeper level. It would also put you in a position where you would be able to take an advantage of the lucrative chances while you are mitigating threats that are harmful to your business down to the line.

We hope that this helps you in planning your business from the very start. Let us know what you think on the comment section below. 

7 Response to "Ecommerce Business Plan"

  1. Comment From Martin Cahucom

    Will definitely bookmark this for future reference. It’s a really nice guide.

  2. Comment From Delany Smith

    This guide looks really good.

  3. Comment From Jonathan Davis

    Great article, more power!

  4. Comment From Harry Conner

    Will definitely read your other articles, this one is really interesting and it wasn’t hard to understand.

  5. Comment From John Smith

    Easy to understand, Not too lengthy, and entertaining article!

  6. Comment From Liam Gartner

    I like reading your articles, and I agree with the comments above.

  7. Comment From Kissy Mirtle

    Great! I’ll try these steps when I start working on my business soon.

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