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Ecommerce Information |
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The Ecommerce Business Plan
Simply put, business plans can make or break your business. Starting a Drop Ship business online is no different from starting a traditional non-online business. With the strong emphasis individuals place on writing business plans for starting up non-internet-based companies, it is equally crucial to prepare a business plan for your online business. A business plan serves many important purposes for the online business. First, because the business plan has a detailed list of the tasks to undertake, it is a call to action for you to promote your business actively and not procrastinate on your marketing efforts. Second, it provides a blueprint that describes your company effectively: the market, the products and the steps you need for effective marketing. This serves to guide your business through the months ahead. Business plans normally comprise of five sections: 1) The Objectives. This section will describe the objectives for the venture, and the mission statement that defines the online business. It states both the financial and strategic objectives and is normally about one page long. There should be a concise description of the Drop Ship business at the start. A brief example: 'Magical Stores Online is an internet company that provides quality tools and resources for magic tricks. We aim to consistently provide magicians with reliable tools for conducting magic tricks, and also accurate information and guides on how to properly perform the magic tricks with our tools. In our first year online, our target is to have U.S. $400,000 in revenues and $100,000 in profits. This can be achieved by attracting an average of about 5000 visitors to our website every month through effective internet marketing. Our strategy is to attract recurring traffic to our website by continually updating the useful resources and information on our website. Magicians will constantly return for more useful tips on magic tricks. This cuts our marketing costs drastically and adds to our profit margin.' 2) The Executive summary. The executive summary should contain a few important details. It should outline the basic model of the company, how the business functions, the market environment, and also the business opportunity in the market. A continuation from the previous example: 'Magical Stores Online is a retailer of magic products on the internet. We specialize in card and coin tricks and stage magic, and classify our products according to age group, skill level, features, and the occasion they are used for. Magicians can browse the product catalogue on our website and buy their products with a shopping cart software. They can choose to pay either by credit cards or by checks. We use a third party credit card merchant to process our payments, hence eliminating the need to have a merchant account ourselves. A profit is realized whenever a sale is made, because we obtain our products at a wholesale price and we sell them at a retail price. Since our supplier, Company XYZ, drop ships the products directly to the customers' address, we do not need to hold any inventory. Our market comprises of magicians of any age group who specialize in card and coin tricks and stage magic. The opportunity lies in the internet as a marketing medium for magic products. Since the rise of the internet in the mid 1990s, we find that the major magic product retailers do not use the internet effectively to market their products. With effective internet marketing skills, we believe that we can reach a wider audience than the other major players, thus claiming a large market share.' *Note that in a real business plan, the business owner should aim to provide a more detailed version than the examples given above. The examples here only serve to illustrate an overview of what the basic business plan should encompass. 3) Marketing Strategies. In this section, you will describe the steps you intend to take in order to market your business effectively on the internet. There are a few basic marketing methods available on the internet. Mentioned below are three of the most popular methods. - Email Marketing. Ezines and newsletters are powerful tools. It is simply the most cost-effective form of marketing on the internet. Sending out email promotions or newsletters to your subscriber base costs virtually nothing, except for the time you spend on writing your newsletter. With the web form on your website, you can capture the names and email addresses of the customers who subscribed to your newsletter. I do not recommend that you send your subscribers with product promotions regularly, but you should continually provide them with useful tips and information. In this way, you establish your credibility as an expert and maintain a strong relationship with your customers, instead of appearing as someone just out to make money. Promotions for your products should only be sent out about once or twice a month. - Search engine optimization. Optimizing your website for high search engine results on google, yahoo and msn, is a powerful way of getting large volumes of traffic at low cost. However, you have to put in a lot of effort for a long period of time, as top rankings do not appear overnight. There are two factors for search engine optimization: On-page or Off-page optimization. On-page optimization involves tweaking the page title, header and meta tags to include the website keywords. It also involves scattering the keywords throughout the page to improve the site relevancy. Off-page optimization, on the other hand, is much more important than on-page. It involves soliciting links from relevant websites. The more the websites that link to your site, and the higher the importance/relevance of the website linking to yours, the higher your website will be ranked on the search engines. Google places a very strong emphasis on this. - Pay-per-click (PPC) Search Engines. This requires you to pay a sum of money for every visitor that clicks through the search engine to your website. The higher the amount you pay, the higher your website will be ranked on the PPC search engine. The basis for profiting with this marketing tool is by bidding less than the amount that each visitor to your website is worth. Overture is definitely the market leader for pay-per-click search engines. 4) Competitive Analysis. In this section, you have to analyze the strengths and weaknesses of your competitors, and the factors that will differentiate your products or services from your competitors. You have to analyze your competitors and record what makes them so successful, and also the weaknesses you can capitalize on to get an edge in the market. For example, competitors may not be using email marketing effectively to promote the products to customers. You can capitalize on this by using newsletters more intensively, establishing your credibility as an industry expert. To differentiate an online Drop Ship business, it is more viable to provide a reliable service from your website. This usually means providing a wealth of tips, articles and information for your visitors. This will attract them to continuously return to your website for the latest tips and resources that will benefit them. Fast response to their email queries and also fast shipping are also good services you can provide. 5) The financial projection section. In this section you can project the profit-loss statements and the cash flow statements for your business. The profit-loss statement records the monthly profit/loss realized over the months, while the cash flow statement records the difference between revenue and expenditure over the months. The costs for an online Drop Ship business will include: - One-time costs for software like shopping cart software, email marketing software, and also search engine optimization software. - Recurring costs for the wholesale price of the products, web hosting fees, a proportion of revenue paid to your third party credit card merchant to process your payments, and also internet marketing costs. This section will be useful for you to gauge how your Drop Ship business performs according to your expectations. In conclusion, business plans do not only apply to real-world businesses, but are equally critical to online businesses as well. They serve as blueprints of the companies and also as strong calls to action for the aspiring internet entrepreneurs to achieve their success in ecommerce. *You are welcome to reprint this article as long as you include the Author's resource box with the article. About the Author: Ray Yee is the founder and president of Dropshipperscentral, a website which provides a wealth of informative articles, tips and resources on everything you'll ever need to know about setting up a Drop Ship Business and marketing it. Click here for the Wholesale Drop Ship Directory from http://www.dropshipperscentral.com
MORE RESOURCES: How to optimize your ecommerce ad spend and budget for the best ROI Search Engine Land TikTok plans major growth in Seattle area as it looks to take on Amazon with e-commerce feature GeekWire JD.com subsidy scheme for store owners fails to appease investors; shares tumble South China Morning Post Can the Shopify and Amazon Partnership Help Propel Growth for the E-commerce Platform? The Motley Fool TikTok expanding in Seattle area as it ramps up e-commerce business - Puget Sound Business Journal The Business Journals Q2 2023 E-Commerce Report PitchBook News & Analysis E-commerce platform Homesome to begin accepting online SNAP Winsight Grocery Business With 14 million ecommerce sites, the US is atop the online world Digital Commerce 360 Latin America ecommerce growth outpaces other regions’ CAGRs Digital Commerce 360 DHL eCommerce opens consolidated distribution center near CVG ... Supply Chain Dive Ecommerce Game-changers (in 2014) Practical Ecommerce The Limited Role of AI in Ecommerce Retail TouchPoints FMI Reports eCommerce is Expanding in Packaged Food Market Food Engineering Magazine Ecommerce Website Builders Market 2023 | Modern Report: Key Players and Innovations for 2030 Benzinga It’s Official – Amazon is an Ecommerce Enabler First and a Retailer ... Retail TouchPoints Deloitte: Holiday ecommerce sales to grow this season Digital Commerce 360 AI and E-commerce: Simplifying the Sales Process CO— by the U.S. Chamber of Commerce Build a Community, Says Sendlane CEO Practical Ecommerce How Plural Keywords Impact Search Intent For Ecommerce [Data ... Search Engine Journal Google launches new report that flags checkout issues on e ... Search Engine Land FedEx launches new Picture Proof of Delivery for eCommerce ... Enterprise Times Optimizing the ecommerce payment experience Digital Commerce 360 Branded eCommerce Soundbars Trend Hunter B2B Strategy Report: Pacing B2B Ecommerce Trends Digital Commerce 360 DHL eCommerce opens flagship sorting hub near Cincinnati ... Parcel and Postal Technology International StoreConnect secures $9M in funding to shake up the ecommerce ... KMWorld Magazine Ingredients Online adds ingredient supplier Caldic to its B2B ... Nutritional Outlook How Amazon cracked the e-commerce riddle in India Business Today Sponsored Love: Crafting An Effective E-Commerce Inbound ... Harlem World Magazine Borsheims Promotes Andy Brabec to Vice President of Marketing ... Columbus Telegram Amazon: Beyond E-Commerce GuruFocus.com eCommerce businesses leveraging technology to win customers VnExpress International Challenges and Decline in Ecommerce Stocks Best Stocks ShopClues parent firm to invest Rs 165cr to speed up cross-border ecommerce The Financial Express Amazon-CCI row: E-commerce giant gets brief respite as SC schedules hearing for December | Mint Mint Luxury performance footwear brand, Athletic Propulsion Labs (APL ... - Premier Construction Magazine Luxury performance footwear brand, Athletic Propulsion Labs (APL ... Premier Construction Magazine Retail and eCommerce news from the week beginning 21st August ... Enterprise Times Retail and eCommerce news from the week beginning 28 August ... Enterprise Times Poundland relaunches ecommerce website | News Retail Week CN Logistics rides on eCommerce boom The Star Online How Affiliate Marketing Can Transform E-Commerce Total Retail People Are Shopping Online Again: 2 E-Commerce Stocks to Buy Now The Motley Fool SERP Signs of a Trusted Brand Practical Ecommerce A veteran ecommerce fulfillment vendor has new owners Digital Commerce 360 40 jobs lost as Belfast ecommerce firm goes bust Belfast Telegraph Charts: U.S. Manufacturing Trends Q3 2023 Practical Ecommerce Laws on ecommerce to be reviewed for better consumer protection The Star Online The role of e-commerce analytics in informing business strategy Retail Customer Experience Best Content Types for ChatGPT Practical Ecommerce Costco e-commerce sales drop 2.5% in August Morningstar UK Food Safety Testing Finds One Third of e-Commerce Samples ... Food Safety Magazine |
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