Developing the Best e-Commerce Business Plan

Now that you have an idea for an online business, it’s time to develop an e-commerce business plan. An e-commerce business plan is an outline that details what you’ll need to have a successful website launch. In today’s technological age, one of the most cost-effective ways to manage a business is through an online store. With a comprehensive blueprint that illustrates the trajectory of the website, any business owner can experience a successful launch! Don’t know where to start? This article will discuss what an e-commerce business plan should look like, the most important elements to have when drafting an e-commerce business plan, and templates to help you prepare for your website for launch.

Why You Need an Online Retail Business Plan

You might ask yourself, “Do I really need a business plan for my online store?” It seems straightforward to produce a product, market a product, and deliver it. However, to ensure long-term success, having a benchmark is the best way for your online retail store to reach its potential. Finding the right business plan can be daunting. The best way to go about this is to determine the type of features you would like your website to offer and the metrics you would like to achieve. There isn’t a specific order you should follow when planning for your online business. However, drafting a business plan while completing the design for your website could be helpful. Each plan is different, but it’s important to focus on the goals you set for your business.

Brainstorming over paper

e-Commerce Business Plan Template

Now that we know why we need a business plan, let’s explore e-commerce business plan templates. To clarify, this is not a comprehensive list but rather a list of important items to consider when creating one. For the sake of clarity, let’s pretend we have an online business selling mugs and we are drafting our own business plan. It’s important to remember that an e-commerce business plan template functions the same way as a business plan for a physical store. However, due to the size of a startup, your business plan doesn’t have to be as long or detail oriented.

Description of Your Company

While you already know your business, it’s important to put it on paper. It can help potential investors or partners get to know your company. When creating the draft, it’s best to include what services or products you’re selling, explain your business type, introduce the founders or partners, and state your business model. Before we get ahead of ourselves, let’s define the different types of business models and business types.

e-Commerce Business Models:

  • B2C: Business to consumer.
  • B2B: Business to business.
  • C2B: Consumer to business.
  • C2C: Consumer to consumer.

Business Types:

  • Sole proprietorship.
  • Partnership.
  • LLC (Limited Liability Company).
  • Corporation.

As a business description example:

Design Mugs is a B2C online retailer that specializes in customizable mugs. We are a partnership founded by two sales managers. Between us, we have been employed by fortune 500 companies and have driven sales by 200%. Our love for niche dishware has inspired us to open an online store. All our products will be handmade using resources made in the United States. In the future, we plan to sell our products department stores.

List of Products

Knowing the types of items you’re selling is just as important as what you’re selling. To borrow our Design Mugs example, we’re planning to sell mugs of different sizes and shapes. Furthermore, the designs can vary from different sizes and locations on the mugs. Next, explain why your products are different from other items on the market. For Design Mug, our product is centered around the customer, allowing them to craft their own product. Essentially, Design Mug is selling an opportunity for a customer to explore their own individuality. Finally, you should have a rough idea of how much your product will cost. As a rough cost, Design Mugs will sell products from $15-$35.

If you have a little bit of time left, how about start writing your own bucket list

Market Analysis

A market analysis is an evaluation of the market you’ll like to enter. For example, Design Mugs would analyze the demand for dishware. When writing a market analysis, it’s best to perform research. Depending on your findings, you might have to refine your product list and rework your marketing strategy. Crafting a SWOT analysis will be a good start off point. A SWOT analysis (Strength, Weakness, Opportunity, and Threats) is a report of what your business can offer, what they lack, where they can improve, and what they should watch out for. To demonstrate, Design Mugs’ strength is a customer’s ability to customize their own products. A weakness could be processing and shipping times. An opportunity is having a variety of mug sizes and shapes for their target market to choose from. Lastly, a threat could be a lack of exposure and retention in the market.

Key Things to Include in a Market Analysis

  • Target Market. Your target market consists of your audience. Who will buy your product? What type of items would they like? Where do they live? The best way to define your target market is to understand who would purchase your product. Design Mugs’ target audience would be middle-class women between the ages of 40-65. For this audience, it might be worthwhile to sell mugs in sets. For example, having newlywed mug sets available for customization could be a wedding gift.
  • Demand. Demand focuses on how the market will respond to your product. When trying to persuade an investor, this is the portion of your online retail business plan where you prove that you’ll be successful in the market. For Design Mugs, we can argue that our wide range of customizability will the competition in our favor.
  • Barriers to Entry. Barriers to entry consist of why it might be difficult for you to enter a market and have a successful business. For instance, a barrier of entry for Design Mugs could be a lack of demand for customizable mugs, competitors who sell similar products at a lower price, or the inability to financially support the business i.e. marketing. If you look at your competitors, you can offer a service or product they do not. Furthermore, you can see if your current business plan and idea are viable.
  • Competition. Likewise, a competitor with a larger customer base can be a barrier to entry. To understand your competition, drafting a list of their strengths and weakness will help you learn where you can fit in the market. To demonstrate, “Cups and Company” as an example business could have more exposure in the market but have a lack of options for a consumer to choose from.

Marketing Strategy

Your marketing strategy is how you plan to promote your online retail business. SEO is a cost-effective marketing strategy. You can rank higher on the Google search page by adding keywords and blog posts to your website. For example, including keywords in different variations about mugs, dishware, and design. Adding blog posts can help drive traffic and boost keyword usage. Social media is another free marketing method. By understanding your audience, you can prioritize social media pages to target them more effectively. Since Design Mugs wants to target women in their 40s, using Facebook will be one of the most effective options. Once you established a customer base, you can invest in email marketing to sell promotional products and bundles.

Statistics on a laptop

Financial Plan

One of the most important factors of the e-commerce marketing plan template is how you financially support your business. Since this an online retail store, you can forgo a storefront, rent, and utilities. However, budgeting for labor, materials, and shipping will still be a priority. Additionally, hidden costs such as web hosting, warehouse space, and editing software should be considered while drafting your financial plan. To demonstrate, Design Mugs fixed costs (costs that don’t change) are web hosting and employee labor. One-time purchase costs will be photo editing software. Our variable costs (costs that change) will depend on the number of orders we receive. These costs will consist of the mugs, printing materials, and shipping materials.

In addition, mapping out the break-even point, current assets, and profit loss and gain are the most important components of the financial plan. It’s vital that you consistently meet the break-even point or the amount of money you’ll need to make to cover your expenses. Without it, you can easily acquire debt. Your current assets are important to cover your start-up cost. The likelihood of you hitting the break-even point shortly after launch is unlikely. So, until then, you need to have enough money set aside to support your business. Calculating your profit loss and gain for your fixed and variable costs will be an important factor in reaching your break-even point. For example, if the price to make each mug is approximately $8, your profit gain needs to be at least $8 per mug while covering the other fixed costs such as labor.

business plan

Other Questions to Think About

Some other elements when drafting an online retail business plan are logistics, paid marketing, and milestones. Logistics consists of suppliers, inventory, and shipping timetables. While we discussed free marketing strategies, paid marketing strategies such as advertisements and PPC (Pay Per Click) and CPC (Cost Per Click) are other options to consider. Having goals at the launch of your website is a great way to stay motivated and ensure positive growth. Borrowing the Design Mugs example, goals we can set for ourselves is 50 orders a month within two months, 200 followers on all social media channels within three months, and at least a 10% purchase-review rate.

Do you still need help drafting an e-commerce business plan? SEO Design Chicago offers an array of services to help assist your marketing needs. Schedule a consultation with one of our associates today.


  • How to start an e-commerce business plan?
  • What is the e-commerce business plan format?
  • How to write an e-commerce business plan?
  • What are examples of an e-commerce business template?
  • How to write a business plan for an online store?

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