Productivity is never an accident. It is always the result of a commitment to excellence, intelligent planning, and focused effort. — Paul J. Meyer
As with all businesses, the journey to success begins with careful planning. Too often, we see stores that are hastily launched, poorly configured, and inadequately marketed. Just as you’d expect with any new business, most online businesses fail to achieve profitability. And, to us, this is unfortunate. The downside to selling online is much lower than more traditional selling methods. However, the complexity of e-commerce can derail even the best products, services and brands.
Build a business plan
Some platforms tempt businesses to quickly launch: “Build a store in 30 minutes!” While, technically, you can launch an online store in quick order, building a successful store requires a lot more work. It’s not atypical for online merchants to quickly build an online store, then find out it doesn’t do what they want it to do. Or, the team concentrates on design over functionality, resulting in complex programming and higher costs once it is discovered that the site doesn’t serve its customers or business processes correctly.
As we have learned from our own experience — we have built successful online businesses for ourselves, as well as for clients — we know that creating a business plan before engaging a developer or designer is critical. While your plan doesn’t have to be a detailed prospectus, it should have enough detail and represent adequate considerations for the following primary areas:
- Products. What are you selling? How will it be priced? Do you have different customer groups? How complex are your product types? Will you be bundling products or services? Physical, digital or intangible products?
- Inventory. What is your inventory master? How will you manage inventory receiving? Do you have to coordinate inventory from various channels?
- Orders. Will you take off-line and on-line orders? What payment methods will be available? Will you offer credit terms to customers? What will be your return policy?
- Customers. Are customers repeat customers? Wholesale, retail, jobber customers? Do any customers have to meet selection criteria (e.g. resellers)? What tax considerations apply?
- Systems. Who is responsible for making sure your site and all related systems are operating? What is the security protocol?
- Integrations. How many systems need to be interconnected to make data efficient and meaningful? Do you have an existing ERP/Accounting system that needs to be integrated? Are there fulfillment and shipping integrations?
- Marketing. What is the marketing plan for the new selling channel(s)? What is the plan for managing and benefiting from social media? How will SEO and pay-per-click advertising be managed?
- Budget. What are the financial costs and resources for your project? What ROI needs to be achieved? What is the sales volume needed to achieve profitability? What are the core KPIs (key performance indicators) on which you’ll focus your ongoing analysis.
If you create a business plan that addresses these key areas, your greatly increase your chances for success.
We can ask the right questions
If your company is new — or struggling — with e-commerce, it may not be from a lack of planning, but from not knowing how to plan for e-commerce. There are lots of questions and decisions relating to online commerce that are quite different from traditional commerce. It’s not that you don’t have the answers, it may be that you don’t know the questions.
We’ve worked with many online merchants that have little or no experience in e-commerce. The good news is, that we do have experience. Great experience. And, we enjoy leveraging our expertise to help businesses succeed by beginning with a proper business plan.
Make the correct financial decision
Here’s a scenario we have seen all too often: a company decides to sell online. They employ a development company to build a beautiful e-commerce website on a popular platform. After spending their budget on the new store, the business finds out that the platform doesn’t handle integrations with their warehouse well. Plus, they want to sell on Amazon.com, but their product data is not properly structured.
Their marketing group finds that the site is not ranking well and is in need of serious SEO overhaul. The company hires an outside firm to handle Google Adwords, but the firm spends little time really learning the company’s products or brand; the PPC budget skyrockets with not positive ROI in sight.
After a few months of these frustrations, they blame it on the platform or developers, and look for another remedy with which to begin the process again. Things go a bit better, since they’re learned from their first version, but reality doesn’t quite meet expectations and, once again, the company shifts directions.
All of this could have been avoided by having a comprehensive business plan constructed by novusweb. Instead of spending 3 or 4 times their original budget to eventually arrive at a beneficial solution, they could have spent a fraction of that on a great business plan and launched with an online business endeavor that had the best chance for success.
That’s making the correct financial decision.