How to Make an Ecommerce Business Plan for Your Startup

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Darren DeMatas

January 30, 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.

Ecommerce Business Plan 2020

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.

Quote 5 Jeff Bezos Retail Is Details

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

Ecommerce Business Plan Template 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

Ecommerce Business Plan Template Company 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

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.

Facebook Audience Size

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.

Outdoor apparel kids hiking hiking gear Google search Trends worldwide 2004-present

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

Ecommerce Business Plan Template 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

Ecommerce Business Plan Template Marketing

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

Ecommerce Business Plan Template - 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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Table of Contents

1. Define your e-commerce business idea

2. set up your business, 3. source or develop your products, 4. set up your e-commerce website, 5. figure out order fulfillment, 6. market your e-commerce business, how much does it cost to start an e-commerce business, tips for starting an e-commerce business .

An e-commerce business sells goods, services and funds over the internet. Starting an e-commerce business is a lot like starting any company: You’ll need to create a business plan, get licenses and permits and set up dedicated finances. You’ll also need to choose an e-commerce website builder , source your products and market to online customers.

Follow these six steps to get your e-commerce business up and running.

Square

The first step in starting any business is to hone your idea. Online business ideas can include selling physical or digital products as well as professional services. Whatever you choose, you’ll want to define your e-commerce business model and write a business plan that outlines your niche.

During this process, you’ll start to ask a lot of questions: How will you get your products or services to your customers? What sort of licenses or permits do you need? How much will it cost to get your business up and running — and how will you foot that bill? Your business plan should answer these questions and provide a road map for the coming months.

More resources to help shape your idea:

What is e-commerce? Understanding how it works  

Our picks for the best business plan software

Can your business idea actually make money?

Once you've solidified your e-commerce business idea, the next step is to set your company up for success.

Bizee

This includes back-office steps like:

Choosing a business structure . There are benefits and drawbacks to each of these entity types, so talking to an attorney may be helpful as you choose the one that’s right for you.

Naming your business. Consult your local secretary of state's website as well as the U.S. Patent and Trademark Office to ensure that you're not choosing a name that belongs to another company. Check to see if your potential business domain name is available as well.

Applying for an employer identification number (EIN) . You can get an EIN from the IRS for free online or by mail, fax or phone. Not all businesses need an EIN, but having one can help you separate your personal and business finances.

Opening a business checking account . NerdWallet recommends all business owners have a dedicated bank account for their business.

Getting licenses and permits your city or state requires. This probably includes a business license, and if you perform services, you may also need an occupational license. Check your state or local government website for requirements for your area.

Answers as you set up your business:

Do you need a business license to sell online?

What’s the difference between an LLC and a sole proprietorship?

Our picks for the best free business checking accounts

Next, you'll need to source the products you're going to sell. If you’re selling physical products, you may need to make them yourself or work with a manufacturer.

A key decision at this point: Are you going to order products in bulk and keep inventory in stock? If so, you’ll need to think about storage space and raising capital to order goods upfront. However, you’ll have the power to ship items yourself.

Other businesses choose to rely on dropshipping , in which products are manufactured or sourced at the time the order is placed. In general, dropshipping may keep your overhead costs lower, but it can be more difficult to manage since inventory levels and shipping will be out of your hands.

Other options for sourcing e-commerce products include:

White-labeling, or ordering items in bulk from a manufacturer and then branding them with your company’s identity.

Print-on-demand, or paying a third party to print your company’s designs on merchandise like T-shirts, mugs and posters. Print-on-demand normally functions like dropshipping, in that a customer places their order, then the manufacturer creates the product and ships it directly to the customer.

Retail arbitrage, or buying discounted items from retail sellers and listing them in your own store at a markup. 

If you're selling professional services, you might just have to describe and list what you offer on your business website. Still, you’ll need to figure out how much to charge and decide how many clients you can see each day or week.

More to help you develop products:

16 e-commerce business ideas

How to find products to sell on Amazon

How to make money on Shopify

Your e-commerce website will be your storefront. It’s where your customers will learn about you and your business, browse your products and make purchases.

The easiest way to set up a website is to use an online store builder . These platforms can walk you through the process of launching your website, from buying a domain name to managing your inventory to taking credit card payments.

Popular e-commerce website builders include Shopify , Squarespace , Square Online and BigCommerce .

If you’re a very small business or just experimenting with online sales, a free e-commerce website builder may be a good place to start. But to list unlimited products and access more robust suites of tools — which can help with things like shipping label printing, order management and sales analytics — you’ll typically need to spring for a subscription.

In general, many online store builders should be simple enough for someone without web development experience to navigate. But most offer the option to pay a professional designer or developer if you don’t want to build the website on your own.

The best e-commerce platform for you fits into your budget and is appropriate for your skill level.

Choosing the right website builder:

Our picks for the best e-commerce website builders

Wix vs. Squarespace: Head-to-head comparison

Shopify vs. Square Online: Head-to-head comparison

Order fulfillment is the process of getting customers’ purchases in their hands.

Most e-commerce website builders offer shipping label printing, which is the first step in the fulfillment process. Some also offer the ability to add shipping costs onto customers’ orders at checkout.

If you choose to handle order fulfillment yourself, research shipping rates so you have a sense of how much it’ll cost. Look for an online store builder that can help make the shipping process easier or research shipping software providers like Shippo .

Note, too, that e-commerce may connect you to customers across the world. If there are places you’re not willing to ship to, make that clear on your website.

If you don’t want to manage order fulfillment, you can outsource it to an e-commerce fulfillment center or use a service like Fulfillment by Amazon. Fees for fulfillment services vary depending on the size of your products, how far they’re traveling and how much you’re shipping.

More to help you manage orders and inventory:

Our picks for the best inventory management software

What is just-in-time inventory?

Shipping services that integrate with WooCommerce

Now that you've started your online store , you're ready to start serving customers — as long as they can find your products.

Your small-business marketing strategy might include:

Omnichannel commerce , in which you list your products on third-party marketplaces like Amazon and Instagram. Some e-commerce website builders can help facilitate this.

Influencer marketing, in which you pay popular social media creators to plug your products. 

Social media content or paid social media ads.

Optimizing your business website for search engines.

Sending email campaigns to past and future customers.

Many e-commerce website builders include some marketing features, which can help you do things like create social media ads or send emails to customers when they’ve abandoned their carts.

But if you want to develop more sophisticated campaigns, consider investing in marketing software . These tools can help you create email templates and campaigns, text customers, keep track of how individual customers are responding to your emails and more.

More help with marketing:

20 free marketing ideas for small businesses

Online marketing strategies and tips

Content marketing for small businesses

The cost of starting an e-commerce business can vary widely depending on what you’re planning to sell and in what volume. Your expenses may include:

Your e-commerce website. Subscription plans for online store builders generally start around $25 to $30 per month when billed annually. You may also need to spring for a domain name if your e-commerce website builder doesn’t include one — and make note of annual fees to keep your URL registered. 

Payment processing fees. In general, the company that provides your payment processing will take a cut of around 3% from each online sale. 

Stocking up. If you plan to order inventory in bulk, be prepared for significant upfront costs — even before you’ve started generating revenue. Inventory financing may be able to help you bridge the gap.

Order fulfillment. In general, you’ll pay a third-party service to fulfill each order, with rates varying depending on item size and weight. The more customers buy at once, the less you’ll have to pay per item. Order fulfillment services may also include warehousing, for which you’ll pay a per-item storage cost. 

Warehousing. If you’re buying more inventory than you can keep in your home or garage but not using an order fulfillment service that provides storage, you may need to spring for warehouse space of your own.

General costs of running a business. These could include monthly or annual fees for accounting software , business insurance , any employees or contractors you plan to hire and more. You may also need to set aside money for small-business taxes .

As with launching any business, starting an e-commerce business can feel overwhelming. Here are some tips for managing the transition.

1. Start simple

If you’re not certain e-commerce is the right path for you, set up an online store with low overhead first. This may mean starting with the free version of an e-commerce website builder, ordering a small amount of inventory or selling only one or two types of products. 

Starting small can limit how much startup funding you need and make it easier to pivot if your first idea doesn’t land. As your business starts to get traction, you can trade up to a more robust e-commerce platform and expand your product line.

2. Cultivate a loyal customer base

Your e-commerce business needs customers who appreciate your products enough to buy them more than once and, ideally, customers who will promote them to their networks.

Establishing a strong brand presence on social media can help you build a following. But the more information you can gather from your customers, the more you can market directly to them, whether that means creating an email marketing campaign, sending discount codes through text message or letting them know where your booth will be at an event in their region.

3. Invest in multichannel selling

Loyal customers may be willing to visit your website frequently. But to reach new ones, you might have to meet them where they are — which might be on Amazon, Instagram, TikTok or elsewhere. Start with the platforms where your customers are most likely to be, launch those integrations and then see how they perform. You can add platforms later if they fit into your business strategy. 

Keep in mind that selling in person is a channel, too. Craft fairs, local shops and industry or trade events may help you connect with new customers while generating some revenue.

A version of this article originally appeared on JustBusiness, a subsidiary of NerdWallet.

On a similar note...

  • Jul 26, 2023

How to create a defensible eCommerce business plan

how to create an eCommerce business plan

Most eCommerce websites are built on a dream, a passion, or a noble goal of fixing something that lacks a proper solution.

But unfortunately, many businesses don’t last more than a few months. A discouraging truth about eCommerce is that 90% of startups fail in the first 120 days.

Suffice to say that in order for your business to survive its first precarious years—and to thrive beyond them—you need a solid business plan.

After all, some of the most common reasons why businesses fail include lack of capital, inadequate management, and a faulty business model. Much of this is a symptom of poor planning. Here’s how you can better plan for your brand’s future and create a strong eCommerce business plan.

What is an eCommerce business plan?

A business plan is a roadmap for how to structure, operate, and manage your business. It includes the important elements that define your company—such as your name, description, capital needs, product categories, target market characteristics, and business goals.

A thoughtful business plan can prepare your store for a successful launch and/or help it to scale in the right ways. In the latter case, an annual business plan review and revision can help you adapt to industry changes and anticipate new trends or consumer behaviors.

Black text on a light blue background that says "Launch your online store" with a clickable link button that says "Get Started"

In a nutshell, a business plan helps you to:

Secure funding. By having a business plan that details the who, what, where, when, and hows of your business—you’ll enjoy an easier time building trust with investors and piquing their interest.

Filter distractions. New trends and distractions crop up all the time in eCommerce, making it especially important to have a plan that holds your business accountable to (read: focused on) particular goals.

Do your due diligence. When you’re first figuring out how to start a business , it’s easy to get caught up in the excitement and act on gut feelings. But building a business plan requires you to slow down and perform more thorough research on your target market, product(s), financial plan, and more.

Plan for the long term. Your business plan will help you to better gauge where your business should be in both the short and long terms. It can also act as a compass, estimating the steps you need to take to get from where you are today to where you want to go.

Grow your team. A business plan not only gives you a sense of who to hire and when, but serves as the glue binding your team to one, clearly defined vision.

Grow your operations. Between your tech stack, staff, supply chain, website, and more—there’s a lot that needs to be put into motion before your eCommerce business can take off. Your business plan should outline all of these moving parts, helping you strategically build out your operations.

How to create an eCommerce business plan

An eCommerce business plan is structured similarly to a traditional business plan. However, it will detail things like your website builder, sales channels, fulfillment process, and goals that are distinct to running an online store.

Here’s a breakdown of what you should include in your plan and how to create it:

Write your executive summary

Include your company name, description, and domain

Perform eCommerce market analysis

List the products you’re selling and why

Plot your operations plan

Set out your marketing and advertising plan

Lay out your financial plan

checklist of items to include in eCommerce business plan

01. Write your executive summary

Though this is published at the beginning of your business plan, your executive summary should be written last.

This summary is exactly as it sounds. It connects and introduces all the components of your document for readers who want a brief overview of what your business is all about. It’s similar to a hook or an elevator pitch that compels readers to continue scrolling.

Keep this summary short. Do not exceed one page, and include a brief description of your product or service, growth opportunities, and why your business is set up for success. What do investors or teammates need to know right off the bat?

02. Include your company name and description

In this section, you’ll want to outline the who, what, and why of your business. Rather than going into details about the products you plan to sell (this comes later), talk about your vision for the company. Share your motivations, values, and problems that you plan to solve.

Your description can include things like:

Brand name - Selecting a meaningful name is particularly important for eCommerce businesses since your website domain will be closely associated with your brand. Jeff Bezos famously named Amazon after the world’s largest river because his goal was to create the world’s largest bookstore, but also didn’t want to be tied to books. Similarly, you’ll want to pick a name that you won’t outgrow. If you need some inspiration, give Wix’s store name generator a whirl or check out this guide to eCommerce business names .

Domain name - At this point, you’ll want to have registered a domain name. Use Wix’s domain name search to check if your preferred domain is available. If the domain is taken, you can take one of several steps: contact the site owner directly, tweak your domain (e.g., add a verb like “get” to the front of your name), use a different TLD than .com, or use an abbreviated form of your name.

Background - Your description is a great place to share why you started your business in the first place. What inspired you to create your brand? Who do you plan to serve? What do you plan to accomplish? While you want to avoid waxing poetic here, it’s worth giving your readers an inside look into the history of your company.

Vision - Your vision statement should capture the ideal state of your business. In other words, what is the future that you’re building towards—not just now, but five or 10 years from now?

Mission - Your mission statement , on the other hand, should express what you’re striving and able to achieve now. While your vision statement provides the 30,000 foot view of your company, your mission statement acts as a compass for your team and keeps them motivated to do their best.

google mission vs. vision statements

Business structure - Be clear about whether your company is a sole proprietorship, an LLC , s-corporation, c-corporation , or partnership . If you’re not sure which applies to you or which one to pursue, consult a lawyer or accountant.

Key personnel - Name key team members like your cofounders, CEO, partners, and upper management. There should be no question about who owns the company, and who is responsible for managing what. This is not something just meant for appearances—your team should be well-structured to ensure efficiency and growth.

Core values - Your values should represent how you plan to run your business. Investors and employees will want to know that they’re backing the right horse, not just from a financial perspective but from a human perspective. Your values will naturally make an appearance in your vision, mission, and background, but make sure that your values are clearly stated for readers to refer back to.

03. Perform eCommerce market analysis

Your business plan should include extensive information about your industry and the people you plan to serve. The last thing you want to do is enter the ring blindly or operate based on assumptions alone.

This section should describe everything from the barriers to entry, to how your business fits into the existing landscape, to how much opportunity exists. Remember that you’re the expert here. Not everyone who gets their hands on this doc will have as much insight into the industry—nor the time to research it on their own—so you’ll want to provide all the essential information up front.

Target market - Estimate the number of consumers who need your product (based on real independent research) and how often they may make a purchase. Revisit your buyer personas and describe who you’re planning to target. Is the need for your product growing, based on the climate of your industry? What consumer behaviors have you observed? Are there any doubts or questions that you should address?

Competitive analysis - Identify your top competitors and perform a deep dive into their strengths, weaknesses, top products, pricing strategies, and more. You should know how your business stacks up against these players. For example, many companies manufacture and sell hair and body care products, but Lush built its reputation by taking a stand against animal testing, over packaging, and harsh synthetic ingredients. The company has a clear niche within the cosmetics and bath products industry. They create unique, memorable products that are easy to differentiate from competitors (and fuel brand loyalty). The most important thing at this stage is to be honest in your assessment. Don’t turn a blind eye to areas where your company needs to improve or any risks that you run. At the same time, zero in on any product gaps or niches that your company can effectively target to get ahead of competitors.

Special considerations - As an eCommerce business, you may not simply sell D2C from your branded site. You may also choose to sell on third-party marketplaces like Amazon, sell wholesale, or open brick-and-mortar locations. Each of these may involve a different set of competitors and buyers. Take the time to look into each of these channels separately. Understand how you plan to compete on all of these different fronts (or perhaps now is a good time to define which is most important to start off with).

04. List the products you’re selling and why you’re selling them

By now, you’ve likely mentioned your product several times within your business plan. Still, you’ll want to have a section that clearly lists out your products.

In this section, describe your pricing, product positioning , margins, product life cycle , and key differentiators. You can include pictures and product reviews if you’ve already tested your items in the market. Or, if you’re still in the research and development phase, describe your timeline and progress in detail.

It should be clear whether your products are private label or sourced elsewhere. If you only sell a few items, provide a more detailed description of each. Alternatively, if your catalog is too large to list out, give a more general overview of each product type, plus the strategy behind them.

05. Plot your operations plan

If your business plan is meant to serve as an internal doc for your team to use (or even if you want investors to see where your capital is going), include a section that describes how you plan on tackling logistics and operations. There are tons of things to keep track of on this front, from the suppliers you’ll need to work with to the storage space you’ll require.

Here’s a breakdown of information you can include.

Suppliers - List out your suppliers for raw and/or finished goods. Where are they located? How do you plan on connecting with and managing them?

Production - Are you dropshipping , manufacturing, hand-crafting, or buying your products wholesale? Include details like lead time, contingency plans (for when demand spikes), and other essential details about your supply chain.

Equipment - What hardware and software will you need to conduct business? Include your website builder and other subscription-based tools that you’ll need.

Warehousing - Explain where you plan on storing your products—whether that be your own warehouse or a third-party logistics (3PL) provider.

Facilities - Do you plan on opening a brick-and-mortar location, or will you have a designated office space? Include where your team members will be operating out of and how that might change as you grow.

Personnel - You’ll want to be clear about the chain of command and which roles are filled or need to be filled. Don’t forget to think about any legal or accounting needs, in addition to board members, consultants, and employees.

Inventory - How do you plan on handling inventory management ? This is an area where lots of businesses stumble, so you’ll want to have a clear strategy (and the necessary technology) to keep this in check across all of your sales channels.

Shipping and fulfillment - Do you plan on fulfilling orders on your own or will you outsource this responsibility? Moreover, how will you handle international shipping if your brand plans on selling overseas?

06. Set out your marketing and advertising plan

It’s no secret that you need a good marketing and advertising plan to grow your eCommerce business .

But you may be surprised to know that a staggering 37% of surveyed startup owners said that poor online marketing caused their businesses to fail. Of this cohort, 35% said that a lack of online search visibility was the top reason.

That’s why you don’t want to haphazardly build your eCommerce marketing strategy . Think of—and document—the various components of your strategy:

Social media ads

Content marketing/SEO

Organic social media

Email marketing

Influencer marketing

Promos/discounts

Affiliate marketing

Loyalty programs

Events/pop-ups/trade shows

Radio or TV

Brand partnerships

A strong marketing plan doesn’t necessarily require a big advertising budget. But you’ll want to name your top channels upfront and specify whether these things will be handled in-house or with an agency’s help.

07. Lay out your financial plan

So you’ve got big plans for your business. How will you fund them?

This is where you reassure readers that your head isn’t just in the clouds. While this is probably the least fun to write, the viability of your business (and your reader’s confidence in you) relies on having a firm grasp of the numbers.

If you plan to seek financing, then investors and lenders will want a sales forecast along with your list of expenses (this includes both fixed costs and variable costs) to ultimately ensure that they’re making a sound investment.

Or, if you don’t plan on seeking third-party funding, a financial plan still tells you how much money you’ll need to run your business and helps to protect you from unwelcome surprises. The last thing you want is to run out of money before you can establish yourself—which is one of the top five reasons that eCommerce startups failed in the same survey mentioned above.

Consider including theses elements within your financial plan:

Startup cost

Income and expenses

Balance sheet

Cash flow statement

Break even point

Customer acquisition cost

Key assumptions

Financial projects for next five years

Get cracking on your business plan today

Whether you’ve just dipped your foot in eCommerce or have been in business for years now, you’ll need an up-to-date business plan to run a tight ship. Download our free business plan template today and build a solid foundation for your brand.

eCommerce business plan FAQ

Why do i need an ecommerce business plan.

Having an eCommerce business plan is essential for several reasons. It serves as a roadmap that outlines your business goals, strategies, and tactics, helping you navigate the complexities of starting and running an online store.

What are the main steps included in an eCommerce business plan?

planning online business in ecommerce

Allison Lee

Editor, Wix eCommerce

Allison is the editor for the Wix eCommerce blog, with several years of experience reporting on eCommerce news, strategies, and founder stories.

  • Sell Online

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Choose the Right Ecommerce Platform

For years, you’ve purchased items from online businesses or marketplaces like Etsy, eBay and Amazon and thought to yourself, “I could do something like this, too.”

Starting your own ecommerce business may seem intimidating — writing a business plan, even more so.

However, a business plan allows you to validate your business idea, assess your financial position and create a concrete action plan for how you’ll deliver a product from the original source to the end consumer.

In other words, while the business plan might seem like it’s ultimately meant for other people’s benefit — potential investors, business partners or well-meaning family members who keep pestering you to write one — in reality, the business plan benefits you, the business owner, the most.

You’ll shape the vision and mission for your business and map out how you’ll get there. One study by Harvard Business Review found that entrepreneurs who write a formal business plan are 16% more likely to achieve viability than those who don’t.

An ecommerce business plan is a document that outlines your business purpose and goals, analyzes your industry and competitors and identifies the resources needed to execute your plan.

For example, which suppliers will you work with? What types of products will you stock? Who is your ideal buyer? How will you advertise your business? Can you afford to provide free shipping and still make a profit?

Here’s a step-by-step primer on how to write a business plan for your ecommerce store, what elements to include and how to use your own business plan to increase your chance of success.

How to Create An Ecommerce Business Plan

Business plans help entrepreneurs maintain focus on their goals and shape the day-to-day running of a new business. The key elements of an ecommerce business plan template describe blueprints for growth, projected timelines and financial goals — clarifying topics like cash flow, expenses, marketing tools and distribution channels.

Draft an executive summary.

An executive summary provides a concise rundown of the key points in your business plan. In short, it should summarize your chosen industry, business purpose, competitors, business goals and financial position. Executive summaries average 1-3 pages and are ideally under two pages.

What does your business do?

Explain the raison d’être for your startup. What problem will you solve for your customers? Who is the target audience? Where do you want your business to be in one, five, or 10 years?

Here are the main elements of an executive summary:

The problem statement or business opportunity : Describe a pain point or gap in the market that you are uniquely qualified to fill. (“As someone who used to own a convenience store, I heard many of my customers complain about the lack of healthy food options while traveling domestically.”)

Your business idea : State how you plan to approach the problem (“XYZ is a ready-to-eat meal company that lets travelers order and pack healthy meals ahead of trips so they can avoid eating fast food.”)

Company history : Describe what milestones you have achieved. Are you already working with suppliers? What is your current revenue? (“In 2021, XYZ fulfilled over 10,000 orders, generating $150,000 in revenue.”)

Industry and market analysis : Outline the trends in the market that affect your business, market size, and demand for your product. (“In 2022, the global health and wellness food market was valued at $841 billion and is projected to increase to one trillion by 2026.”)

Competition : Explain who your competitors are, outline their strengths and weaknesses, and make it clear how you will differentiate.

Timeline for key milestones : Project when you plan to achieve goals like breaking even, launching an IPO, or other key milestones.

Financial plan (if you are seeking funding from investors or banks).

What goals does your business want to achieve?

Set short- and long-term goals for your business, such as achieving a certain amount of revenue or testing a new product idea. Business goals can be general and high-level or they can focus on specific, measurable actions (SMART goals).

The most realistic goal-setting approach is to set short-term goals as stepping stones to your long-term goals. For example, your short-term goal to decrease website bounce rate by 25% within 12 weeks might help you reach the long-term goal of growing conversions by 50% within one year.

Timeframes for short-term goals can range from a few hours to a year, while long-term goals generally take 1-5 years to achieve.

What products do you sell?

Outline your product offerings and specify where you’ll source each item. Some ecommerce businesses manufacture products in-house. Others work with wholesalers, manufacturers or print-on-demand businesses to resell their products.

Curate a tight product line that demonstrates your value proposition. Why should someone buy from your online store rather than another brand? Why would someone choose your products over a substitute if you don't produce goods in-house?

Ecommerce companies sell three types of products: goods, services and digital products. Tell your readers what you intend to sell and why. List each item and its purpose. For each, you want to answer the question “why?” Why are you choosing to offer these specific products and services? How do you plan on fulfilling orders?

If you’re offering a service, explain what you do and where. Are you local? Do you travel to your customers? Will you partner with similar service providers in other areas?

How will customers access the item if you're offering a digital product? Will they download software or education videos from your site? Will they pay a subscription or usage-based fee? What about licensing requirements? Mention intellectual property ownership (if applicable) including trademarks, patents and copyrights.

Who is your audience?

Describe your ideal customer. Define your product or service from their point of view. What problems does your product solve for them? What benefits or features do customers look for when shopping for that product type?

Create customer profiles that summarize your target audience in terms of demographics (age, location, gender, etc) and psychographics (pain points, interests, buying patterns). Consider creating customer segments based on shared characteristics if you cater to a wide audience.

Demographic data should include the following points:

Education level.

Relationship status.

Occupation.

Meanwhile, discover your target customer’s motivations, needs and wants as much as possible. Psychographic data should include the following points:

Where are you going to sell your products?

Outline your sales channels, both future and existing. For example, your main point-of-sale might be your ecommerce site. Be sure to include stats on site traffic and conversions so readers know how your site is performing.

Still, you might also offer your products online on marketplaces like eBay, Amazon and Etsy. Explain how each of these channels is performing and how you’re optimizing them for product discoverability and conversions (eg: following SEO best practices, using high-quality images, highlighting user-generated content).

Identify your company overview.

Tell your brand's story , its purpose, and how the company was founded. In addition to the company description, provide details on how you currently run the business. List your business partners and employees and describe the business's legal structure.

The best brand names are memorable and communicate the essence of your business. Brand names gain icon status because they represent an excellent product or service, so don’t obsess over it.

That said, the right brand name can be your brand’s most valuable asset, driving differentiation and speeding acceptance. In fact, 71% of consumers prefer to buy from brands they recognize.

If you’re struggling to come up with a name, try using an online brand name generator as a jumping-off point. Remember, you’re not locked into a single brand name forever.

Business structure

Describe the legal structure of your business. Is it a sole proprietorship, LLC, an S-Corp or a partnership? Consider speaking to an accountant if you’re not sure. Who is in charge of the business? List founders and officers and their contributions (both capital and expertise) to the company. Who works for the company? Include an org chart that illustrates who currently works for the business and the roles you plan to hire for . List their responsibilities, salaries and terms of employment (freelance, full-time, part-time).[

Your business structure]( https://bristax.com.au/business-articles/business-structures/ ) affects how much you pay in taxes, your ability to raise money, the paperwork you must file and your personal liability in the event of business bankruptcy, so this information is important to lenders. Also mention if you have filed or plan to file for any applicable licenses or permits.

Domain name

Register a unique domain name for your business. A catchy brand name is essential because the domain is less likely to have been claimed by another business. Keep your domain name as short as possible and ensure it includes your brand name for SEO purposes.

Your mission describes the fundamental purpose of your business. It should tell people why the business exists and how it benefits its customers. For example, LinkedIn’s mission statement is “connect the world’s professionals and make them more productive and successful.”

However, be careful not to exaggerate. An overly aspirational mission statement is disingenuous and wishy-washy — no single corporation or small business will single-handedly “change the world.”

A vision statement is a declaration of what you want your business to achieve in the future by fulfilling its purpose. It describes your company’s “why,” while the mission statement describes the “who” and “what” of the business.

Your vision statement should define your values as a business (eg: reducing waste generated by single-use toiletries) and future goals (achieving a zero-waste world by implementing a circular economy).

Background information

Tell the story of how you conceived your business idea. Say you’re a former school teacher who discovered your artistic flair from making handmade pottery in your garage on weekends. Describe how your business has grown and changed since you first started it.

Your team and key people

List the key personnel in your company. Aside from the founders and executive team, who keeps the business running each day? Here are a few examples:

Company owner — that’s probably you.

CEO — that’s probably also you.

Management team.

Customer service manager.

Logistics manager.

PR and social media specialist.

Advertising manager.

SEO manager.

Copywriters.

Conduct market research.

Ecommerce businesses face intense competition and are liable to market disruptions because they rely on third parties (suppliers, shipping companies, wholesalers) to deliver a product or service. Knowing the market in and out will help you build a more resilient business.

A market analysis considers your ideal customer (their purchase habits and behaviors), competitors (their strengths and weaknesses), market conditions (industry trends and long-term outlook), and how your business fits into this landscape.

The point of a target market analysis is to:

Identify the most and least valuable markets.

Develop buyer personas.

Find gaps in the market to fill.

Assess the viability of a product or service.

Improve business strategy .

Market opportunities

The first step to identifying your target market is determining your total addressable market (TAM) — the maximum market size for your product or service. Who are your customers? What are their demographic and psychographic traits? When and how often will they buy your product?

The best way to obtain a high-level overview of your customer base is to consult your social media and web analytics. These dashboards show where your customers live, their age, gender, general interests and more. You can also use U.S. Census Bureau data to pad up this information.

Competitive analysis

Analyze the strengths and weaknesses of your current and potential competitors. First, find out who your direct and indirect competitors are. You can perform a Google search of businesses that sell similar products or scope out rivals in your local area.

Here’s what you need to know about your competitors:

What markets and segments they serve.

What benefits they offer.

Why their customers buy from them.

Details of products and services, including pricing and promotional strategies.

Search for publicly available information about your competitors. Aside from that, do some of your own primary research. Visit their website and complete an order or visit their physical outlet.

Next, analyze the information. Is there a segment of the market your competition has overlooked? Is there a product they don’t supply? Did you have a bad customer experience when you walked into the store?

Detail your competitive advantage in your business plan. Don’t just list things that your competitors do — that’s not analysis. The competitive analysis section aims to persuade the reader that you are knowledgeable about the competition and that your business idea has a significant advantage over the competition.

Products and services

List the products and services you provide and how customers will access them. If you’re selling digital products, will customers have to stream or download the content? Do they pay a subscription fee to access a content platform or do they pay for each individual content piece? If you’re providing a service, will you provide it on physical premises or will you travel to customers’ homes? Will you sell physical products in a physical store or online? What is your website like? List each product, including a short product description and pricing information.

Develop a marketing plan.

You need a go-to-market strategy if you haven’t already launched your business. How will you spread the word about your business? How and where will you advertise and what is your budget? If you run social media ads, for example, what platforms will you use and who is your target audience? Will you do content marketing and SEO? A thorough marketing plan answers all of these important questions.

Marketing channels

Define which channels match your consumer demographic. Do your potential customers spend time on Facebook or do they prefer YouTube? First, figure out where your potential customers are. Next, create attention-grabbing marketing strategies and use them to reach your customer base.

Paid marketing channels

PPC advertising : Advertise on Google’s search engine and pay only once someone clicks on your ad. You can bid for ad placement in the search engine’s sponsored links when someone searches a keyword related to your business offering.

Affiliate marketing : Embed links to another business’s products in your content and receive a commission when someone makes a purchase using your unique affiliate link.

Social media ads : Run paid ads on social media apps and platforms like Facebook, Instagram and YouTube to reach targeted audiences. Ads can use different creatives such as images, videos and GIFs.

Influencer marketing : Work with a popular influencer who will promote your products to their followers. Influencers are paid based on conversions or reach.

Organic marketing channels

Brands must use an organic marketing strategy to build brand awareness and engagement and drive website traffic.

Examples include:

Search engine optimization (SEO) : Optimize your website, web pages and blog posts for maximum discoverability on search engines. This involves doing keyword research for your industry, creating high-quality content that attracts and converts and using keywords in the right places.

Social media posts : Organic social media posts build brand awareness and humanize the brand by providing a behind-the-scenes look at the company and allowing you to share engaging visual content to inspire, educate and entertain.

Blogger networks : Collaborating with trusted bloggers on link exchanges can help you build website backlinks, improving your search engine ranking.

Content marketing : Organic content includes blog posts, white papers, SEO pages, and more. This gives you content to post on social media and improves the discoverability of your website. Websites that publish high-quality content consistently rank higher in search results.

Email marketing : Create email templates for new and potential customers, cart abandonment, promotions and announcements and more.

Logistics and Operations plan

This portion of the business plan covers what you physically need to run your ecommerce company. Basically, it outlines how you’ll manage the flow of goods from the supplier (you or a third party) to the consumer. You cannot start a business without an established supply chain.

Your logistics and operations plan should cover the following:

Suppliers : Where do your raw materials or products come from? Do you work with a manufacturer who produces your product idea or are you reselling products from a supplier, wholesaler or distributor? What is the minimum order value? Do they require payment upfront or after the sale? Do you have a backup supplier in case demand spikes or there is a problem with fulfillment?

Production : Will you create your own products or use a third-party manufacturer or dropshipping company? If you’re creating your own products, where will this be done? What assets and equipment do you need? What are your operating costs?

Shipping and fulfillment : Outline how the product will reach the end consumer. How long will it take you to pack and ship products to customers? Will you use a third-party shipper? Will you ship internationally?

Inventory : How much inventory will you keep on hand and where will you put it? How will you track incoming and outgoing inventory? Do you need warehouse storage space?

Establish a financial plan.

The financial section of your business plan is where you prove the feasibility of your business idea and calculate your startup costs. It includes financial projections and statements that show your business’s current financial position and project where you hope to be in the future. This is one of the essential components of the business plan, particularly if you are seeking investment funding, a bank loan or a business partner.

Income statement

In this document, you’ll forecast the company’s revenues and expenses during a particular period. Total revenue is the sum of both operating and non-operating revenues while total expenses include those incurred by primary and secondary activities.

If you subtract your expenses from your revenue sources, you’ll come up with your bottom line (profit or loss).

Balance sheet

A balance sheet helps you calculate how much equity you have in your business. It summarizes your company’s assets (what you own), your liabilities (what you owe) and equity (money invested into the business plus profits).

A balance sheet enables you to calculate your net worth. All of your assets (machinery, inventory, business premises, etc.) go in a column on the left and your liabilities (accounts and wages payable, business loan repayments, business credit card payments, taxes) go in a column on the right. If you subtract your liabilities from your assets, you get your business’ shareholder equity.

Cash-flow statement

This document shows how much cash is generated and spent over a time period. Cash flow determines whether your business is primarily gaining or losing money. Positive cash flow and profit margins are important because it enables your business to repay bank loans, purchase commodities and keep the lights on.

How to Increase Ecommerce Sales

Explore our collection of free resources designed to help you scale smarter and accelerate your online growth from $1 million to $100 million.

The Final Word

Writing a comprehensive business plan is crucial not only for staying on track in the first year or so after launching your business but also for securing funding, finding a business partner and evaluating the viability of your business idea.

FAQs About Ecommerce Business Plans

Who needs an ecommerce business plan, what are the benefits of creating a business plan, how do i start an ecommerce business with no money, browse additional resources.

planning online business in ecommerce

How to Start an Ecommerce Business: 2024 Edition

With global online retail sales expected to hit $8.15 trillion by 2026, there’s no better time to start an ecommerce business.

But if you’re new to the business world, launching an online store can be daunting. Where do you begin? Should your initial focus be on product selection, website design, or marketing strategy? These questions are common for any budding entrepreneur.

This guide covers all the steps, from the basics to the more advanced aspects of running an online store. You’ll learn how to set up, manage, and grow your business into a profitable ecommerce venture.

planning online business in ecommerce

Start selling online now with Shopify

planning online business in ecommerce

How to start an ecommerce business: 5 steps to launch

1. find products to sell.

Being strategic with your product selection is key. Here are some tips to help you choose:

Capitalize on regional products

→ Click Here to Launch Your Online Business with Shopify

Identify products unique to certain regions or cultures that might have a demand in other areas. These can be traditional crafts, local delicacies, or specific fashion styles.

Explore niche communities

Look into niche hobbies or interests and find products that cater to these specific groups. These communities often have passionate followers looking for specialized items.

Solve a pain point

Think of a problem you’ve personally encountered and consider if there’s a product that could solve it. Products that address real-life issues can resonate well with customers.

You’ll find inspiration is abundant once you start your search. Google Trends can be a useful tool to help validate your product ideas.

Additional resources:

  • How To Find a Product to Sell Online: 13 Tactics for 2024
  • 10 White Label Products Ideas for Ecommerce  

How to source your products

When it comes to sourcing products, dropshipping is a solid option to think about. It’s a setup where an ecommerce business sells products without dealing with inventory. A customer buys something from you, and then you order it from a dropshipping supplier who ships it directly to them.

While dropshipping is a popular choice, there are other business models like wholesaling or direct-to-consumer that might suit different business needs. However, dropshipping stands out for several reasons:

  • Testing new ideas is easier: With dropshipping, trying out new products is a breeze. You don’t buy a bunch of stock upfront, so experimenting with different items to see what sticks is less risky.
  • Geographic flexibility: Run your business from anywhere. As long as you have internet access, you can manage a dropshipping store, making it perfect for those who love flexibility.
  • Lower entry barriers: You don’t need a big budget to start. This makes dropshipping ideal for those beginning their ecommerce journey.
  • The Ultimate Shopify Dropshipping Guide (2024)
  • 11 Best Dropshipping Suppliers and How To Choose the Right One

2. Analyze the competition

Research is integral to the success of your ecommerce store. Once you’ve chosen your products, look at competitors and what they’re doing. Here are a few things to pay attention to when doing a competitor analysis: 

  • What is their business model?
  • Are they selling multiple items or just one product?
  • What social media channels do they utilize?
  • Who is their target market?
  • How do they push sales? (e.g., paid social, PPC, SEO, email, etc.)

Competitor analysis can lead you to identify better products to sell and give you a good understanding of how to launch an online business. Additional resources:

  • SWOT Analysis: How to Create One + Examples to Inspire You

3. Write a business plan

With your competitive research complete, it’s time to write your business plan. This plan serves as a roadmap, guiding your ecommerce journey from start to growth. It’s especially important for aligning your goals and strategies.

Tips for crafting a successful business plan:

  • Define clear objectives: Start by setting specific, measurable goals for your business. This could include sales targets, customer acquisition numbers, or market penetration rates.
  • Outline your business model: Describe how you will manage inventory, whether through dropshipping or holding stock.
  • Detail your marketing approach: Explain how you’ll attract customers. Include tactics like SEO, social media marketing, and influencer collaborations.
  • Make financial projections: Include detailed financial forecasts. Show expected revenue, expenses, and break-even point.
  • Conduct a risk analysis: Identify potential challenges and how you’ll address them. This could include market changes, supply issues, or technological advancements.
  • Include an action plan: Break down your strategies into actionable steps with timelines. This makes your goals more attainable and trackable.
  • The 7 Best Business Plan Examples (2024)
  • Business Plan Template: The Ultimate Guide for Ecommerce Businesses

4. Choose a name and logo

Choosing a business name.

Choosing the right name for your online business is a critical step. A good name sticks in people’s minds and becomes synonymous with your brand’s identity. Tools like Oberlo’s business name generator are great for sparking unique ideas and checking if a domain is up for grabs.

After picking a few names, see if they’re available on social media. Your brand needs the same name everywhere for people to recognize you easily. Thinking of selling worldwide? Make sure your name works across different cultures. You don’t want any surprises there.

Crafting a logo

Your logo is the visual heartbeat of your brand. Begin with something straightforward yet impactful using Shopify’s free logo maker . This tool is ideal for those new to logo design.

Consider how your logo will appear in different settings. It needs to shine on everything from your website to product packaging. A well-designed logo, aligned with your business name, lays the foundation for a strong brand presence in the online marketplace.

  • How to Build a Brand: An 8-Step Guide
  • Branding Design: What It Is and How to Do It

5. Build your online store

Once you have chosen a name and logo, the next thing to do is build your store. Choosing ecommerce hosting platforms like Shopify can make setting up your store easy. Shopify has lots of templates to start with and an easy-to-use online store builder that doesn’t need coding input. 

When your website is ready to start taking orders, remember to try a test order yourself to make sure the process is smooth for the customer. Alleviate any additional steps needed to buy something online and ask only for information that is necessary for the checkout process.

  • 7 Best Free Shopify Themes For Your Online Store
  • 58 Most Inspiring and Successful Shopify Stores in 2024

6. Choose your sales and marketing channels

There are various sales channels available, and selecting the right ones depends heavily on your target audience and the types of products you sell. If you specialize in unique or handcrafted items, niche marketplaces like Etsy are more suitable than broader platforms like Amazon or eBay. 

Here’s a list of marketplaces that cater to different niches:

  • Bonanza : A great platform if you’re selling unique and diverse items. From fashionable clothing to rare collectibles, it attracts a wide range of buyers.
  • Newegg : If your specialty is electronics and tech gadgets, Newegg is your marketplace.
  • Reverb : This niche marketplace is dedicated to musical instruments and gear. It connects sellers with a targeted audience of musicians and enthusiasts.

On the marketing front, balancing cost and effectiveness is key. You want to reach the right people without breaking the bank. Here are some strategies to consider:

  • Social media marketing: Engage on Instagram with live sessions, for example—a cost-effective way to connect and show your brand’s personality.
  • Email marketing: Interactive emails with quizzes or polls boost engagement without significant expense, offering valuable customer insights.
  • Influencer partnerships: Working with niche micro-influencers can be more affordable and effective for targeting specific customer groups.
  • Search engine optimization (SEO): Focus on voice search optimization. It’s a smart, future-proof strategy that can reduce long-term marketing costs.

Additional resources

  • 10 Best Marketing Channels for Ecommerce Stores
  • 9 Marketing Strategies That’ll Level Up Your Ecommerce Store

7. Launch your business 

Now, you’re ready to launch your online business. It’s a big step, and there’s plenty to keep an eye on as you start. First up, watch your key performance indicators (KPIs) closely. They tell you how well your store is doing and what you might need to tweak.

Next, make sure your shipping runs smoothly. Happy customers often come back, so getting orders to them without a hitch is crucial. If something goes off track, be ready with a backup plan.

Finally, keep learning and adjusting based on what your customers say and what your data shows. This way, your business keeps growing and improving.

How much does it cost to start an ecommerce business?

Starting an ecommerce business can be more budget-friendly than you think. Often, you might need only about $100 to get going, mainly for a website subscription and a theme for your store. One of the perks of an ecommerce business is that it typically costs less than a brick-and-mortar store. You won’t have the same overheads like rent for a physical space.

If you opt for a dropshipping business model, the initial costs can be even lower. In dropshipping, you pay for products only after customers buy them, so there’s no upfront expense for stock. However, if you’re making products yourself or working with manufacturers, you’ll need to invest in materials and labor from the start.

Shopify’s research sheds some light on what to expect financially. They surveyed 150 entrepreneurs and 300 small business owners across the US. The findings suggest that new ecommerce store owners might spend up to $40,000 in their first year, covering everything from products and operations to marketing and staff wages. But these costs are usually offset by your business’s profits.

Here’s a rough breakdown of typical first-year expenses: 

  • Online store setup: 9%
  • Operating costs like legal fees and software: 11%
  • Marketing: 10.3%
  • Product-related costs: 31.6%
  • Shipping: 8.7%
  • Team and staff expenses: 18.8%
  • Offline costs, like event fees: 10.5% 

However, the actual amount can vary based on factors like your industry, the type of ecommerce model you choose, and whether you hire employees. And you don’t need to have the entire sum upfront. Many entrepreneurs start with personal savings, while others may seek support from friends, family, or personal loans.

4 tips for creating a profitable online store

Launching an ecommerce business is just the beginning. To make it profitable, you need to think differently. Here are some actionable tips for success: 

1. Enhance customer interaction 

Revamp your customer service approach. Implement interactive features like virtual product trials or augmented reality on your site. This will give customers a new way to experience your products.

2. Gamify your shopping experience

Transform your website into an interactive playground. Add elements like scavenger hunts for discounts or fun quizzes that lead to personalized offers. These tactics can make shopping more engaging and increase sales.

3. Personalize with AI

Incorporate AI technology into your store. Use it to analyze customer behaviors and preferences. Then, tailor product recommendations and content accordingly to enhance the shopping experience.

4. Keep your inventory fresh 

Regularly update your product offerings. Use market trends and customer feedback to introduce new items. Consider limited-edition products or collaborations to create excitement and attract repeat visits.

Open your ecommerce store

Building an ecommerce business from scratch has its mix of highs and lows. You’ll be choosing products, gauging their market fit, and handling production. Next comes developing your online store and drawing in customers. It’s a bit like solving a complex puzzle, and the satisfaction of seeing it come together is immense.

Hopefully this article has helped you understand how to start an ecommerce business. You’ve got everything you need at your fingertips to make this the year your store takes off, and we’re happy to help you meet this goal.

Ecommerce business FAQ

What are the 4 ecommerce business models.

There are four primary ecommerce business models, : 

  • Consumer to business (C2B): In this model, individuals offer products or services to businesses. An example is an influencer charging a fee to provide brand exposure to their audience.
  • Business to business (B2B): Here, one business sells goods or services to another business. For instance, a company might sell wholesale products to another business for their use.
  • Consumer to consumer (C2C): This model involves transactions between consumers. An example is selling vintage clothes on a platform like Facebook Marketplace to another individual.
  • Business to consumer (B2C): In this common model, ecommerce businesses sell goods or services directly to individual consumers, like purchasing a jacket from an online retailer.

How do I start an ecommerce business without money?

To be honest, you’d need at least a few hundred dollars to start an ecommerce business. That’s because it’s a product-based business that requires you to build an online store, do marketing, and invest in the growth of your brand.

That said, you can start an ecommerce business on the cheap by choosing dropshipping as your business model, tapping into free marketing channels, and creating brand awareness via word-of-mouth strategies. You can also look into funding programs like Shopify Capital to get the money you need to start and grow your ecommerce business.

Is an ecommerce business profitable?

In a word: yes. But realizing your profits could take a while, since an ecommerce entrepreneur’s journey is a marathon rather than a sprint. It could take you 18 to 24 months to see a profit. That’s why we recommend you don’t measure the success of your ecommerce venture by your net profit in the first year.

Want to Learn More?

  • How to Start a Photography Business
  • 30 Amazing Startup Business Ideas
  • The Ultimate Guide to Mobile Commerce
  • How to Start a Business

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planning online business in ecommerce

How (and Why) to Write Your Ecommerce Business Plan

Reviewed by

December 22, 2021

This article is Tax Professional approved

Visions of becoming a successful ecommerce entrepreneur may have you browsing domain name ideas and virtual storefront websites. After all, what’s easier than launching an online business from your living room in just a few clicks?

What's Bench?

I am the text that will be copied.

The truth is that prospective ecommerce business owners who don’t have a step-by-step plan can face major challenges later on. An ecommerce business plan can help you anticipate future growth and avoid common obstacles.

Why you need an ecommerce business plan

You may wonder why a business plan is even necessary if you’re just going to have an online store.

Even though you won’t be selling products out of a traditional brick-and-mortar shop, you still have to clarify your goals, finances, suppliers, and marketing strategies. More importantly, you can use the plan to convince prospective lenders and investors to back your ecommerce company financially.

Without a roadmap for planning your online shop, it’s easy to lose direction and focus. The ecommerce business plan serves as your guide on your journey from a small start-up to a potentially profitable venture. A solidly written business plan will not only help you get your business off the ground, but it will also be an indispensable tool to help with future expansion.

An e-commerce business plan can help you:

  • Validate your business idea.
  • Define your target audience and which products and services to sell.
  • Detail the financial, physical, and human resources you need to get the business off the ground.
  • Create a game plan, including measurable goals, for sales and future expansion.
  • Understand who your competition is and how you will gain the upper hand in the marketplace.
  • Convince investors and lenders to help you establish your business and expand later on.

What an ecommerce business plan includes

An ecommerce business plan will act as the guide describing the how’s and why’s of your future business.

The plan should include the following:

  • Values that the business will offer to customers and clients. These can include finances, time, convenience, and customer service.
  • How and when your ecommerce business will be profitable.
  • Any resources necessary to operate the business, such as funding, employees, and equipment.
  • Plans for expansion, including new products or services you plan to offer in the future.
  • How your business stacks up against the competition.
  • Current financial reports and projections.

Writing your ecommerce business plan

Now that you know what to include, you can begin writing your formal ecommerce business plan. There are many free business plan templates available for download, but we like this easy-to-follow ecommerce business plan template from the Shopify website .

Templates and formats will vary, but there are five main components you should always include in your ecommerce business plan:

1. Executive summary

Think of the executive summary as an introductory short story about your business that should draw potential investors into the rest of the plan. This first section sets the stage for your small business and should leave readers with a strong impression.

Make sure you address the following factors:

  • The business name and domain name, both of which should be easy to remember and accurately reflect what you’re marketing.
  • The products and services your business will provide.
  • The target market for your business.
  • If the ecommerce site will be run from your home or from a rented office space.
  • Short and long-term goals of the business.
  • What marketing strategies you plan to use.

For example, say your business is going to specialize in sugar-free candy. You’ll can use your executive summary to introduce the business with an easy-to-remember name—something like “The Low Sugar Shop,” maybe—with a similarly catchy domain name to go with it.

2. Company overview

This section, also known as the company description, could be considered a biography of the company. Be sure to include in-depth details, such as:

  • The history of the company, including how you came up with the idea for the business.
  • The legal structure of the business (LLC, S corporation, C corporation).
  • If you are a B2B or B2C ecommerce business.
  • The management team, as well as any partners.

The company overview should also include your mission statement, which is the reason you are starting the business. It can be a simple statement or a more detailed description.

A sample mission statement

For your sugar-free candy shop, a mission statement might look something like this:

The Low Sugar Shop is dedicated to offering a wide variety of the highest quality, low and no sugar candy at affordable prices. At the Low Sugar Shop, we believe sugar-free candy should be just as satisfying as its high-sugar counterparts. That’s why we offer a complete line of the most popular low and sugar-free candy available today.

3. Market research and analysis

Every business needs a market—without customers, your business won’t succeed. How you identify your market is key to your ecommerce business’s success. The more information you have about your potential customers, the more faith your investors and lenders will have in your business.

Recent industry reports can usually be found online, and they’re a great place to research growth in your target market. These reports include information such as how much growth there is in the industry, what may be causing this growth, and the demographics of the industry’s largest customer segments.

The market analysis section should include:

  • The demographics of your target market, such as population size, age, education, and income level. If it’s a niche market, is there enough demand for your business to be successful?
  • The needs and search habits of your target customers, as well as your ability to meet these demands.
  • Your anticipated competitors, as well as what will differentiate your business from theirs. This requires some competitive analysis to uncover their key product features, pricing strategy, monthly website traffic, mission statement, and business model.
  • Once you know what you’re up against, you can strategize ways to stay ahead of your competition, such as offering unique products, concentrating on specific in-demand items, and offering more attractive discounts.
  • Your marketing plan, including the marketing channels you plan to use.
  • Your marketing strategy will be informed by your previous work in this section since the shopping behaviors of your target personas will impact where you choose to advertise. This will include social media and any paid advertising methods, such as pay-per-click ads, affiliate marketing, and influencers. You can also include other unpaid strategies you may use, like email marketing or writing SEO-driven blogs and articles to help increase traffic to your website.

Market research for the Low Sugar Shop

To continue our example, in conducting your industry research for the Low Sugar Shop, you discover there is tremendous growth in this area since many people are cutting down on their sugar intake for health reasons. The taste and quality of sugar-free candy have also improved significantly in recent years, adding to the demand and appealing to more consumers.

Your research also indicates that your target demographic will be relatively well-educated, health-conscious consumers in their 40s and 50s.

Your candy business can start by looking into the popularity of specific brands of other low-sugar and sugar-free candy products. This information gives you an idea of how to stock your ecommerce store so that you meet that demand.

Include how you will target your advertising, which in this case may be in publications and websites that cater to healthy eating.

4. Logistics and operations

If your business will be selling physical products, your logistics and operations plan will describe how your ecommerce business will manage product inventory and deliveries. This is where you can demonstrate a thorough understanding of your supply chain, including contingency plans for any issues with timelines and raw materials.

If you are only selling digital or virtual items, this will not be an issue. However, you must still specify how these items will be delivered, such as via email or by navigating to a download website. This assures your stakeholders that your products will be readily available for your customers upon request.

This section of your business plan should contain the following information:

  • Where you will obtain your inventory from, and how much lead time is needed to ensure adequate stock of all your products. Include who your suppliers are along with their costs. This includes any wholesalers to purchase products in bulk for resale or if you plan on using a dropshipping service.
  • The amount of inventory you will have on hand and how it will be stored.
  • Any restrictions for shipping to international customers.
  • The projected packing and shipping times of your products from your wholesaler and estimated shipping time to your customers.
  • Any contingency plans you have in place for peak demand periods.

5. Financial plan and projections

Prospective stakeholders will go over your financial plan with a fine-tooth comb. After all, they want to be assured that they are making a wise investment in your ecommerce business.

This section shows potential investors how long it will take you to make your expenses back and help determine if you need a business loan.

You’ll need to include the following supporting documents in this section:

  • Income statement : Your income statement includes all of your projected startup costs, including supplies, licenses, fees, and deposits, as well as costs for creating the business structure. Be sure to include additional fixed expenses, such as domain name registration and server fees. Your variable projected expenses are the cost of products sold and credit card payment fees.
  • You can calculate your projected net income by subtracting all of the above expenses from your projected total revenue.
  • Startup balance sheet: Your balance sheet lists the business’s assets, such as inventory, equipment, supplies, on one side and liabilities, such as taxes and loan repayments, on the other.
  • Subtract the liabilities from the assets to arrive at a projected amount of shareholder equity.
  • Cash flow statement : The cash flow statement documents your projected cash inflow and outflow. Here you will list the amount of money you plan on having at the beginning of each month, total sources of cash from sales, loans, lines of credit, and expenses you plan on incurring.

How Bench can help

A detailed projection of your start-up costs and revenue assures investors that you’ve carefully considered every possibility, which makes your ecommerce business a better bet. Stakeholder confidence soars when you can provide professionally prepared financial statements to prove that you already have a solid bookkeeping system in place.

Bench can help by assigning a dedicated bookkeeper to handle your pre-revenue startup tasks, including preparing your projected financials.

After your e commerce business is off and running, your Bench bookkeeper keeps your books in order so you can focus on the day-to-day responsibilities of your new business. Learn more .

Putting it all together

We get it: writing up a business plan may not be the most exciting activity, but it can save you time and money in the long run and help prepare you for the challenges ahead. The plan puts all of your ideas, questions, and concerns with their solutions in writing, providing a roadmap that guides you throughout your business start-up journey.

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planning online business in ecommerce

How to Write an eCommerce Business Plan + Template

Two female and two male entrepreneurs working in a small office on taking and fulfilling online orders. One is reviewing their business plan to see if their eCommerce site is on track.

Noah Parsons

10 min. read

Updated November 13, 2023

Free Download:  Sample eCommerce Business Plan Templates

If you’re starting an online eCommerce business , it’s tempting to dive right in and set up your digital shop. After all, eCommerce businesses are often less expensive to start than physical businesses and the risk may seem lower. Unfortunately, that’s not the case. There’s still risk involved and money you may lose if you don’t start your business the right way.

So if you want your business to be successful you’ll want to start with a business plan first. Not having a business plan is one of the primary reasons businesses fail and it’s an easy first step that you can start for free.

Businesses that do take the time to plan are actually proven to be significantly more successful than those that don’t.

  • Why write an eCommerce business plan?

If you’re looking for funding from investors for your eCommerce business, you’ll definitely need a business plan. But, business plans aren’t just for entrepreneurs who are looking to raise money for their business. There are many other reasons why you should consider writing a plan.

  • Strategy. Writing your plan down will help you clarify your business strategy and figure out key aspects of how your business will run. You’ll think about your marketing plan, fulfillment, sales strategies, and more.
  • Test ideas. Business plans can help you figure out if an idea will work. A plan will help you figure out which ideas will be profitable and which will struggle to make money.
  • Know your numbers. Developing your financial plan as part of your business plan will help you understand what it’s really going to take to start an online business. Running the numbers will help you determine profitability and what it will take to get your business up and running.
  • Market research. Your business plan will help you answer questions about who your customers are and how you can best get your product in front of them.
  • Marketing and advertising. Getting your eCommerce business running online is just the first step. Now you need to bring customers to your website . Having a plan and knowing how much it will cost you before your start will improve your chances of success.
  • Business plan competitions. An often overlooked way of getting money for your eCommerce business is business plan competitions. There are thousands of them every year that include cash prizes. With a solid business plan, it’s usually free to enter.

A business plan can help you develop your strategy, test your idea , figure out how much money you’ll need to get up and running and identify potential roadblocks. It’s a critical step that will ensure that you don’t waste time or money as you get your business off the ground.

  • How to write an eCommerce business plan

Every business plan follows a fairly standard format, but for eCommerce you will need some extra detail in the marketing and fulfillment sections. Here’s an outline of what you should include. 

If you’re ready to get started you can also download a free template for your eCommerce business plan .

What’s your biggest business challenge right now?

Executive summary.

Every business plan needs an executive summary . Usually, you write the summary last, after you’ve fleshed out all the details of your plan. The executive summary isn’t a repeat of the full plan—it’s really just a brief outline that should be 1-2 pages at the most. 

When you’re getting introductions to investors, you’ll probably just share your executive summary to start, and then share the full plan if an investor is interested. 

Your executive summary should summarize your vision for your online business, the products you’ll be selling, a short description of your target market , and highlights of your management team and financials. If you did a market analysis, don’t get into tons of detail, but cover enough that a casual reader will understand what you’re trying to accomplish.

Opportunity: Problem and Solution

The first chapter of your eCommerce business plan describes your opportunity. That’s a description of the business you are building and the problem you are solving for customers. 

Every business needs to solve a problem for customers. For your business to stand out and be successful, you’ll ideally fill a gap that other companies haven’t filled yet. 

Even if you’re selling the same types of products as other companies, your eCommerce business could offer a better shopping experience, lower prices, or better customer service. The problem you are solving then is that customers can’t get good customer service or low prices from other companies in your industry. They will come to you, instead, because you do offer those things.

You can also solve problems for customers by offering a product they’ve never seen before. Perhaps you’ve developed a new line of kitchen utensils that are designed for older hands and wrists. Or maybe you’ve invented a new line of soap that is more sustainable than traditional hand soap.

Target Market

Arguably, the target market section of your eCommerce business plan is one of the most important components. Your target market describes the types of customers you hope to attract. Trying to please everyone is bound to be a failure—instead, focus on a specific group of people or type of person and build from there.

For example, maybe you’re trying to sell to young professionals who value good design. Or, maybe you’re targeting new families who are looking for sustainably made, affordable kids toys.

When you’re writing the target market section of your business you’ll describe exactly who your ideal customer is, what their demographics are, and how large your target market is.

There are a lot of details that you can include in your target market section of your eCommerce business plan, and we’ve got a great article that covers everything you might want to include .

Marketing and Advertising

For an eCommerce business, getting the word out about your business is critical. Unlike a physical storefront that potential customers might walk or drive by, an online store needs to figure out how to get customers to its virtual doors.

In the marketing and advertising chapter of your business plan, you’ll want to detail your marketing plan for your business – how are you going to get customers’ attention? How will they know you exist?

Here are a few tactics you may want to consider:

  • Content marketing. Start writing blog posts that your potential customers may find interesting so that you can attract prospects to your business. Also, consider guest posting on other blogs that your potential customers might read.
  • Social media. These days, most consumers expect that the companies they shop at will have some form of social media presence. Pick the networks that you plan to be active on and determine a strategy that will engage your potential customers.
  • Traditional PR. Traditional PR isn’t dead. If you can get popular publications to cover your company launch and your products, you’ll be able to drive new customers to your door.
  • Advertising. Online advertising will almost certainly be in your plans. The good thing about online advertising is that you can measure its effectiveness and fine-tune things as you go. Depending on your business and how much cash you have on hand, you may consider traditional off-line advertising as well.
  • Email marketing. For many eCommerce businesses, email is a core strategy for driving sales. If you have a content marketing plan, you can use that content to drive email subscriptions. You can also offer deals to build your email list, such as free shipping or discounts on orders.

Successful eCommerce businesses are all about ensuring that their operations are running smoothly and efficiently. Use your business plan as your chance to figure out what your operations plans are ahead of time before you jump in and get started. This is where many businesses can get tripped up, so taking the time to get your operations set up properly is worth the up-front investment of time.

Areas you’ll want to cover include:

  • Locations. Even though your business may be online, you’ll still need to run the business from somewhere. Perhaps you can run the business entirely remotely, but potentially you may need some office space for employees or warehouse space for product storage. Think about where these locations are located and what it will cost to keep them running.
  • Suppliers. You’ll need suppliers for raw materials if you’re making products and you will also need suppliers if you are reselling products. Use your plan to figure out who you’re going to work with, what their purchase terms are, and what kind of delivery timeframes they can provide for you.
  • Production. If you’re assembling raw materials into products, you’ll need to know how and where you will be producing your products.
  • Storage & fulfillment. If you’re not drop-shipping from products from a supplier, you’ll need to store and ship your own products. Your business plan should detail where and how storage and fulfillment will take place and what the costs will be. Don’t forget to think through how you’ll handle returns and exchanges.
  • Technology & payment processors. All eCommerce businesses need technology to function. You’ll want to think about the platform you’ll use for your online store, what functionality you need, and how you’ll accept payments. 

Company & Management

This chapter of your eCommerce business plan describes the structure of your business and who is running it. If you’re going into business with other people, you should establish a partnership agreement. Your plan will need to explain how your business is structured and who owns what portions of the business. 

You’ll also want to include a company description that includes details on the management team and the highlights from their resumes. Potential investors will be looking for experienced owners and managers to get an eCommerce business up and running, so this section of the plan should explain why your team is qualified to build the business into a success.

If you aren’t looking for outside investment, this section of your eCommerce business plan is still important. You should think about the different positions you’ll need to fill and who is going to do each job in the business. Even if you don’t plan on hiring employees right away, having a plan for who you’re going to hire and when will be enormously helpful when the time comes.

Financial Plan

Finally, your eCommerce business plan will need to include a financial plan . Investors will want to see a sales forecast , income statement (also called profit and loss statement), cash flow statement , and a balance sheet. If you use a tool like LivePlan , you’ll be able to build out your financial forecasts relatively quickly, even if you don’t have experience with business numbers.

Even if you’re not working with investors or getting a bank loan, you should run your numbers. This is arguably the most important part of your business plan. You need to know if the numbers work for your business based on your forecasted sales and planned expenses . 

It’s much better to find out if you need to make changes to your business model while it’s all just an idea on paper rather than a business that you’ve already invested money in.

If you need additional help, we’ve created a guide to creating the financial statements you need to include in your business plan .

  • Ecommerce business plan templates and examples

If you want to see how other eCommerce businesses have created their plans, check out our free library of eCommerce business plans . You can download all of them in Word format so you can jump-start your own business plan.

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Content Author: Noah Parsons

Noah is the COO at Palo Alto Software, makers of the online business plan app LivePlan. He started his career at Yahoo! and then helped start the user review site Epinions.com. From there he started a software distribution business in the UK before coming to Palo Alto Software to run the marketing and product teams.

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How To Make an E-commerce Business Plan

Disclosure: Our content is reader-supported, which means we earn commissions from links on Digital. Commissions do not affect our editorial evaluations or opinions.

Every e-commerce business needs a plan. As the old saying goes, “failing to plan is planning to fail.” The rise in easy-to-use and affordable  e-commerce platforms  has facilitated a huge increase in the number of successful online businesses. But that’s not all your business needs to thrive.

A profitable and long-lasting online store requires forward planning, and an e-commerce business plan is essential in helping you lay the foundations for your business’s future growth and success. In this article, we’ll go through:

  • What an e-commerce business plan looks like
  • Who needs one
  • Why you need one
  • Everything you need to include in your own plan

What Is an E-commerce Business Plan?

Man leaned back looking up at various graphics.

An e-commerce business plan is a written document that details and outlines your business, your business goals, and how to achieve them. It also describes how you plan to maintain and scale your business, financial plans, customer base, and many other details that help you manage the direction of your e-commerce business.

Why Is an E-commerce Business Plan Important?

Far from just another task on your to-do list, an e-commerce business plan plays a crucial strategic role in the success of your venture. Below are just a few ways an e-commerce business plan helps you achieve your business goals, highlights your pain points, and helps you to plan for the future.

Helps You Develop Your Value Proposition and USP

A common problem for e-commerce business owners is how to differentiate their stores from the hordes of others that exist. However, even if you don’t have an e-commerce niche, it’s still possible to distinguish your store from the rest by developing a solid value proposition and unique selling proposition (USP).

When you start to put pen to paper about what makes your business unique, you’ll begin thinking about factors you haven’t thought of before. Much like a mind map, you’ll start small, and expand on your original ideas and goals. You’ll be surprised how much an e-commerce business plan can help you evaluate, clarify, and refine your value proposition and USP and, in turn, understand the scope of your business.

Helps You Establish Business Goals

Making a profit is a priority when it comes to business goals, but an e-commerce business plan helps you outline exactly how you’ll achieve that. Getting a plan down on paper helps you create realistic goals, separate your short-term goals from the long-term ones, and specify exactly what you can do to achieve them.

Helps You Avoid Making Mistakes

E-commerce business plans not only help you realize what you need to do to achieve your goals but also what you should avoid doing. Your business plan will help you identify common mistakes that you may be at risk of making before it’s too late. For example, targeting the wrong customer base, choosing the wrong e-commerce tools, or not doing enough research into  dropshipping  options.

Helps You Identify Opportunities

Usually, when you embark on your e-commerce venture, your product is front and center of your mind. However, an e-commerce business plan helps you identify opportunities to promote your product, expand and differentiate your business, and build any relevant partnerships.

Helps You Evaluate Your Competitors

Once you get stuck into your e-commerce business plan, you also get immersed in what your competitors are doing well, what they’re not doing well, and any opportunities you have to plug gaps you may not have explored.

Who Needs an E-commerce Business Plan?

Illustration of a person pushing a shopping cart across a laptop.

No matter where you are in your e-commerce journey ― whether you’re just started out, are looking for investors, or have been running your online store for a while ― everyone needs an e-commerce business plan. Every stage of your online business needs a plan to be successful.

At the beginning of your e-commerce venture, an e-commerce business plan helps you put your goals into action and estimate how much time and money you’ll need to make these goals a reality.

When you want to attract investors, an e-commerce business plan helps you outline why your business is worth their investment. When you want to grow your business, you need a plan to help you work out how exactly to take your business to the next level.

What To Include in Your E-commerce Business Plan

Your e-commerce business plan is the cornerstone of your business. It lays out clearly the how, why, what, when, and where of all of your business goals, which can sound quite complex.

This level of information can feel overwhelming. To make writing your e-commerce business plan simpler, we’ve broken down the main sections you’ll need to address into digestible sections.

Business plan outline example.

Executive Summary

Like the synopsis of a book, an executive summary gives anyone who reads your business plan a high-level understanding of what your business does, what your goals are, and how you’re going to achieve them.

Even if you’re creating a business plan for your eyes only, an executive summary helps you reaffirm your business concept and ideas. An executive summary should be a one-page document that outlines:

  • The business concept
  • Your products and services
  • Vision and goals
  • Current and future financial state
  • Your expected growth trajectory
  • Your marketing strategy

Your Product and Services Plan

In this section, you’ll highlight exactly what products and/or services you will sell. This is your chance to think about how your products serve customers, what makes them unique, and why they’re worth a certain price point.

You’ll also expand upon how your products are sourced, manufactured, and stored, how much they cost to produce, and what the life cycle of your product or service is. If you sell multiple products or services, highlight the key, high-level features of each.

Ecommerce graphic with various symbols including a credit card, shopping cart, coins, purse, and a globe.

Market Analysis

Any successful e-commerce venture starts with knowing your specific market inside and out, which requires an in-depth market analysis. This section will outline:

  • Industry trends and growth:  Think about where there are opportunities in the industry, where the market is saturated, and how you can exploit any gaps in the market.
  • Competitor analysis:  Who are your main competitors and how can you compete with them realistically? What will you do differently? What will you do better?
  • Buyer personas:  Who will buy your product or services and why? What key demographics will you serve and how will you make your product or service attractive to them?

Customer Profile

Building on your buyer personas, this section helps you delve into the personality, habits, and lifestyle of your target customers. This benefits you when creating your marketing plan since you’ll know who to target and how. Include information like:

  • Where they live
  • Their age bracket
  • Their job title
  • Their income level
  • Their lifestyle choices
  • Their shopping patterns

Marketing Plan

Customer profiles are the bedrock of every marketing plan. They’ll inform how, where, why, to who, and when to market your products or services.

Your marketing plan section should be as detailed as possible since it will form the basis of how you’ll get the eyes of potential customers on your product. At the very least, your marketing plan should include:

  • Information on pricing points:  How much does your product or service cost? Why does it cost this much?
  • The product or service:  Again, how does your product or service stand out from the crowd, and how can you showcase its originality?
  • Where you’ll market your product or service:  Which sales and marketing channels do you use to promote your products? Why are these channels a priority?
  • Financial information:  How much will you spend on your marketing efforts?

Financial Plan and Projections

Of course, the success of your e-commerce store hinges on how well you manage and plan your finances. Most financial plans include:

  • An income statement
  • A balance sheet
  • A cash-flow statement

If you haven’t yet launched your store, it’s best to focus on your financial projections for the first six months of your business. Your projections will take into account your proposed customer base, marketing plans, expected expenses, and potential profit.

Prioritize Your E-commerce Business Plan and Set Your Store Up for Success

Every successful business venture starts with a solid foundation and creating an e-commerce business plan gives you the chance to:

  • Identify opportunities
  • Assess any potential risks
  • Gauge how viable your e-commerce business is
  • Overcome future hurdles
  • Learn about the aspects of the business you’re unfamiliar with

An e-commerce business plan isn’t just another pile of paperwork, but a vital step in securing the success of your business.

What Should You Do Next?

A thorough and well-researched business plan is paramount to bringing your e-commerce business from the planning phase to the launch phase. Choose the  best e-commerce platform  that allows you to manage your e-commerce website, products, sales, marketing, and inventory, all in a single location.  

Evaluate your KPIs  (key performance indicators) as often as possible. It assesses your e-commerce business’ growth if it’s still on track in reaching the goals you set out in your business plan. The best KPIs provide meaningful and actionable insights to grow your e-commerce business. Use the insights to optimize your customer experience across the buyer’s journey. 

A good e-commerce business plan is driven by research and data. To keep it smart and realistic, update your forecast by identifying what works and what doesn’t. Seek opportunities to sustain the financial growth of your e-commerce business, and your growth as an e-entrepreneur. Good habits help you grow faster, keep on learning, and expand your knowledge on how to thrive as an e-entrepreneur.

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Ecommerce Business Plan in 2023: What Is It and How to Create One?

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The idea of starting a business has always been tempting to aspiring business owners, and Covid-19 has fueled the eCommerce trend to the next level.

However, starting a new business can be tough, and maintaining one is much more challenging. It’s not surprising that around 20.4 percent of new businesses had to close after their first year in operation, considering all the risks, challenges, and financial burdens involved in running a business.

So how to avoid business failure after only a short period, even when you believe your business idea is so great and one-of-a-kind in the online market? The secret lies in a solid eCommerce business plan with a clear description and strategy from the start.

In this article, we will guide you through everything you need to know about eCommerce business plan and how you can create a perfect one for your exceptional business idea today.      

What is an eCommerce business plan?

eCommerce business plan is a document that contains every detail contributing to the business’s success.

There is no standard format for an eCommerce business plan, but it normally covers a predefined set of goals and how businesses can achieve these goals by describing in detail business products or services, financial situation, operation model, and many other factors.

Why do you need an eCommerce business plan?

Traditionally, an eCommerce business plan helps investors evaluate your future business and its feasibility when you want to get a loan or raise funds. However, even if starting your online business doesn’t involve funding, creating a comprehensive eCommerce business plan is still essential to lay down the ground and draw a clear direction for your business to follow. 

  • Better understand and plan your business 

Every business idea sounds brilliant at first glance, but many turn out to be a huge mistake or a huge debt once you make it into a real business.

No matter how you came up with your eCommerce idea, it’s essential that you thoroughly understand every aspect of it before jumping into the competition.

Drafting an eCommerce business plan is a perfect occasion to help you do that. While fulfilling and completing some documents might sound like a daunting task at first, researching and brainstorming can help you dig deeper into your business idea, plan for the future, and note down a list of what should be done step by step.   

  • Identify resources

Once you are sure that your unique idea can turn into a profitable business, it’s time to gather the resources you need to run your business.

eCommerce business plan helps you identify your business’s financial situation and how you will allocate your human resources if you don’t want to run your business solo.

  • Know your competitors

When making an eCommerce business plan, you have a great chance to do comprehensive research on the market, as well as other competitors selling the same product or sharing the same business niche. You can learn from their mistakes, advance your product or come up with some idea to compete with them once you are done with your business plan.                                       

Step by step to create an effective eCommerce business plan

1. executive summary.

If you are seeking investors, the executive summary is the most important part of the document as it summarizes your whole business idea and plan. It is also the last section you should write once you have thoroughly reviewed every element of your business plan. 

This part is often one page long, and it contains a high-level summary of your business, but don’t go into details yet. In this section, you might want to give an overview of your business idea, your plan and vision, and how this business is projected to develop soon. The executive summary should be concise enough for a casual reader to understand your business, and attractive enough for investors to keep reading your complete plan. 

In order to write a promising executive summary, here are some common statements you should include along with some examples we have taken from Liquid Culture’s business plan to help you get a better idea of how to write this section:

  • Business concept

Liquid Culture will offer creative women’s outdoor clothing, online, that is both functional and beautiful.  

  • Objectives and vision

Liquid Culture’s mission is to present consumers with designs, styling, and clothes that energize any outdoor activity. Whether it be snowboarding, running along the beach, or drifting down a river, Liquid Culture has comfortable, durable clothing that will look and feel wonderful.

  • Target audience/market

Women’s outdoor wear has grown into a billion-dollar niche in the clothing industry. The popularity of the Internet has launched a number of online stores for women’s outdoor wear but no women’s outdoor company we know of is exclusively selling their products online yet.

  • Marketing strategy

The key is amplified word of mouth via social media, with emphasis on content and opinion leaders related to outdoor fashion and women’s health and fitness sites .

  • Current and projected financial state

Our projections here indicate we are generating unrealistically high cash balances. We leave that here for now, but with the certainty that actual results will emerge using a lot more expenses than what we project here.

  • The team and key people

Larry Wilson and Maggie Granger, co-owners of Liquid Culture, have fifteen years of experience between them in the outdoor garment industry. Maggie has been a senior clothing designer for Manic Woman Clothing for the past seven years.  Larry has been the website administrator for South Face for the past eight years.

In case you are writing this eCommerce business plan for personal use only, you can skip this part since it’s all about summarizing what you have written.       

2. Business description

A business description provides an introduction of your business and dives into the details of everything about your company. In this section, you need to clarify why your business exists, what your plan is for the future, and what you hope to achieve with your business. Some components you should include to do so are:

– Business structure : 

A business structure refers to the legal structure that affects the day-to-day operations of a business.  There are four main business structures that are most common with businesses today. It’s noted that you can change your business structure later as your business grows and expands, though this might require some additional administrative steps.

  • Sole proprietorship: This is the most straightforward form of business structure and the simplest to set up and manage, as it involves only one individual – normally the owner who is responsible for all business operations. This business structure is preferred by many new eCommerce startups and businesses with a low finance base and low risk of liability. 
  • Partnership: A partnership is a business that contains two or more owners contributing to the company through many factors, such as funding, property, skill, or labor. They work together and share the profits from the company.
  • Corporation: This is a complex and expensive business structure to set up since it separates the legal entity from its owners. Two main types of corporations are C-corporation and S-corporation. 
  • Limited Liability Company (LLC): LLC is a hybrid business structure with the characteristics of partnerships and corporations.

– Business model: 

This is the company’s core framework for making a profit and delivering value to customers. Common eCommerce business model types are Business to consumers (B2C), Business to business (B2B), Consumer to consumer (C2C), and Consumer to business (C2B).  

– Mission: 

A mission statement defines your company’s purpose or answers the question of why your company exists. It contains one to two sentences and clearly emphasizes your passion and your inner motivation to start this business.

– Vision:

A vision statement helps your reader understand how you want your business to grow, scale, and evolve and how customers can travel with you on the road to success. Your vision statement can be longer than the mission statement, but try to keep it short and to the point. 

Honest Tea seeks to create and promote great-tasting, healthy, organic beverages. We strive to grow our business with the same honesty and integrity we use to craft our recipes, with sustainability and great taste for all. HonestTea ’s vision

– Background information:

How did you come up with that spectacular idea, and how has your business changed, and grown with you since day 1? A short yet realistic business biography is a practical weapon to gain trust and evoke readers’ emotions. 

– Business goal:

You should include a clear business goal in both short and long term, as well as how your business is projected to develop in the future. This section should include as many numbers, figures, and charts as possible. Try to establish goals that are S.M.A.R.T .: s pecific, m easurable, a ttainable, r ealistic, and t ime-bound. 

– Team and key people:

If you plan to run your business solo, probably this part can be left out. In case your business involves other people, you should list out their position in your company, such as company owner, CEO, manager, etc. 

When you are done writing your business description, you have gained a deeper understanding of your own business, especially some intangible facets like your business principles and cultures. 

3. Market research & analysis 

At this stage, you should be focused on analyzing the potential market. This is a key section of your plan as it helps you identify how big is your potential market, the estimated position of your business, and the competitiveness of this business segment as well. Market research helps you validate your eCommerce business idea and help you pick the right marketplace that can help your e-business not only survive but thrive as well. 

  • Market opportunities

In order to create sales, choosing the proper market can surely be something you should think about first. Even when you have an excellent product idea, it’s possible that you might struggle to get sales if your market is not yet appropriate. Therefore, market analysis with solid data from reliable sources, such as government statistics, industry reports, and official business sector projection reveal roughly how big and potential your market is. By carefully analyzing these numbers, it’s possible that you can get a general overview of how the industry will grow or decline over the next few years, and make some guesses on the trend if possible.

For example, suppose your product or service is related to the tourism industry. In that case, there is a huge possibility that it will expand and grow in the next few years when Covid-19 has been contained, and the cross-border travel and tourism are more flexible.  

  • SWOT analysis

A SWOT analysis identifies the most important factor of your eCommerce business – S trengths, W eaknesses, O pportunities, and T hreats. This kind of analysis helps you quickly look at factors that can affect your business positively and negatively, as well as the opportunities your business can seize when facing industry challenges. 

A SWOT analysis is often broken down into 4 boxes, and each box contains bullet points with the most relevant information, so don’t bother to write full sentences or paragraphs. While strengths and weaknesses are internal factors that come from within your eCommerce business, opportunities and threats rely more on external factors, such as market competitiveness or your competitors.  

  • Competitive analysis

When you start your eCommerce business with a unique idea, it’s too easy to think that there will be no competitors on the market since no one has sold this item before. However, even when you enter the market without any direct competitors, keep in mind that there are many indirect ones – those that sell products that can substitute for your items. Therefore, never start a business without doing a thorough competitive analysis. This is essential in identifying the market’s leaders, determining their strategies and success, and what resources your business can utilize to take advantage of them.

Once you have identified all your competitors, list down some baseline for a deep competitive analysis:

  • Company name
  • Main offerings
  • Primary sales channels
  • Competition category

You can use this Free competitive analysis template from BigCommerce to keep an organized list of your direct and indirect competitors while making this analysis.   

4. Products and services

This section can be excluded if you believe your product information in the executive summary is enough to help readers visualize your product in detail. However, if you plan to present your eCommerce business plan to find investors, it’s essential that you provide a separate section to describe your products or services in greater detail. 

  • Product description: Going into every aspect of your product and service, such as price, quality, and uniqueness if your business focuses on only one product or service. If you sell a wide range of items, include general information about each product. You can describe some future plans on how these products will be upgraded, or how new items on the same line can improve the profitability of the current ones.
  • Product sourcing: Where are your products coming from? Do you make them with an in-house team? Are they handmade crafts? Or do you drop ship products from some suppliers ? 
  • Life cycle: How long will your product last? Is it a seasonal or daily product? The product life cycle is essential to decide when and how often you will acquire new stock, and what you can do with the old ones. 

Language in this section should show confidence in your products and services because, after all, this is still the core of your eCommerce business idea. You can show off your expertise and experience in this field if you have some. 

5. Customer analysis

Analyze your customer groups to craft an ideal customer profile – the foundation of your marketing plan. Your ideal customer profile should be as specific and descriptive as possible, as many strategic decisions in your business operations will be made based on this profile. Building a customer profile, or buyer persona requires you to think carefully about some of the traits and details of potential customers so that you can divide them into demographic groups. Customer segmentation often includes:

  • Their age range
  • Neighborhood/ Where they live
  • Education level
  • Average income
  • Behavior patterns
  • Values and beliefs

You should gain as much information about your ideal customer as possible. Though this information range can vary greatly depending on your target market and products you sell,  keep the number of buyer persona you create to a minimum because it takes time to craft each persona, and building a customized marketing strategy for each one can cost a huge amount of money. Along with customer general information, you can note down some specific aspects that can hugely influence their decisions to purchase your product or service, or factors that help you build your eCommerce marketing plan better, such as:

  • Preferred communication style
  • Job responsibilities
  • Their goals and objectives
  • Their challenges
  • Their pain points

HubSpot provides us with a free tool to create a buyer persona that is super easy to use and visualize. You can even download a comprehensive buyer persona’s guide and template here to utilize and access anytime.   

6. Marketing plan

As you have on your hands a great product idea and a detailed picture of your potential customers, an effective marketing plan will be the catalyst to kick off your online business. Your marketing plan is built in close association with your customer analysis and outlines your current strategy, as well as your future plans to expand the market. This is one of the most critical parts of your eCommerce business plan. 

If you find it hard to start as you have never run any marketing campaigns before, start with the basics. 

With any good or service, there are always 4Ps – or the Marketing Mix by Neil Borden that can help you identify key factors of your online business marketing campaign:

  • Product: What are you selling and how your product or service can fulfill an existing customer demand?
  • Price: How much does your product or service cost? Do you plan on offering some discounts to draw customers? 
  • Place: Where will potential customers look for your product?
  • Promotion: How will you make your product appealing to consumers?

After having a general idea of how your marketing plan will look like, you should dig deeper into each factor involved.

– Marketing channels : Which channels are you going to utilize to acquire, convert and retain customers? You should explain in detail how these channels are a great match for your plan. All marketing channels fall into two major categories, paid and organic marketing channels. 

  • Social media marketing
  • Content marketing
  • Pay-per-click (PPC)
  • Email marketing
  • Video advertising
  • Affiliate marketing

– Marketing tactics: Which strategy are you going to apply? This is essential to explain how these marketing strategies can go well with your marketing channels to generate massive leads for your business.  

=>> Read more: eCommerce Marketing: Best Practices to Drive Sales

– Marketing technology: Be sure to account for the investment into software and skills you may need to make. Marketing technology can go from eCommerce systems, to social media tools, to for instance CRM with email marketing . Luckily, you can start small and there are tools for each growth stage.

– Marketing goals and KPIs:  KPIs are quantifiable measurements that help evaluate the overall progress of a business. Establishing specific eCommerce KPIs for your marketing plan is essential to gauge the successes and shortcomings of your business over a period of time. Some key KPIs you should pay attention to are:

  • Conversion rate
  • Site traffic
  • Traffic source

7. Logistics and operations 

This section focuses on the supply chain – how you deliver products from suppliers/manufacturers to your customers and plans on how you can prepare for some uncertainty related to logistics issues. If this eCommerce plan is for your own planning purposes, you don’t have to illustrate details in every section as if you are seeking investments. But you need to make solid decisions of many factors, from supplier, warehouse to shipping that impact your day-to-day business workflow. It might seem easy to manage when your business is just starting with a few orders per day, but once you receive massive leads and sales, your operation process should run smoothly and make sure you have everything under control.  

Your logistics and operations plan should cover the following:

  • Facility: Where will your business operate? Do you plan to have your own physical locations, or does your business can function online? What equipment (computers, printer, camera, etc) will you need?
  • Production: Will your products be produced in-house, or will you rely on a third-party manufacturing company? If you work with a dropshipping company, how long does it take to get your products? What is your plan for the busy holiday season? 
  • Suppliers: Where are your products produced? Did you find the source to get the raw materials yet?
  • Shipping and fulfillment: eCommerce fulfillment can be an issue if your online business handles a large volume of orders. So will you go with self-fulfillment, or will you use a third-party fulfillment partner? 
  • Inventory management: How will you manage and track all your inventory? Do you plan on keeping stocks in-house, and where do you plan to keep them? 

We will calculate the cost later, but this section should be able to give you a solid foundation on your business operations, and which key factors will ultimately affect your budgets. 

8. Financial plan

Here comes the last part and also the backbone of your eCommerce business plan. Your business survival depends greatly on its financial health. Planning your finances is essential to anticipate expenses and profit margins, as well as have a clear view of how to manage your cash flow. If you are in search of investors, this part should contain the highest degree of detail as at the end of the day, everyone wants to work with a business having a foreseeable future. Normally, your financial plan has to include four main sections:

  • Income statement

This part illustrates your revenues and expenses over a specific period of time – a month, a quarter, or a year, which helps readers see your company’s bottom line (your profit or loss) during that period. If your online business is not yet launched, you can place a forecast of the same information. 

  • Balance sheet

A balance sheet helps you calculate the equity you have in this business. Your business assets (cash, stock, inventory, etc.) should be noted down one column. The other column is your liabilities (debts, accounts, and wages payable, current borrowing, share capital, etc.). If you subtract your liabilities from your assets, you will get your business’s shareholder equity.    

Equity = Assets – Liabilities

  • Cash-flow statement

A cash-flow statement is like your income statement but happens in real-time. It indicates exactly when your revenue and expenses go out and come in. Keep a record of your company’s cash flow to adjust the way you do business when you have more money going out than coming in.    

  • Financial projections

If your online business has operated for a while, it might be appropriate to include a financial projection. This one is the same as the cash-flow statement, but instead of focusing on your business finance during a specific past time, financial projections help you expect how much money comes into and out of your business during a specific time period in the future. This is a reliable indicator of whether your business can afford to pay off a loan. 

Making a financial plan can be painful and time-consuming, but it is a vital part of any eCommerce business plan. It decides how your business will thrive or go down in the future, so you should spend the most time on this task. You can refer to this financial plan example and template from Shopify when doing this task. 

eCommerce business plan templates

Even when you have learned by heart every section of an eCommerce business plan, creating your plan from scratch can be a daunting task. Therefore, we have collected for you the most easy-to-use yet still comprehensive templates to utilize. These templates offer step-by-step guidance in plain language to help you fulfill the whole template even when you haven’t learned anything about business before. Each template might contain different parts, but the core content is the same. You can either edit them on Google Docs or download a copy on Microsoft Word to edit offline.

  • Business Plan Template by Shopify
  • Business Plan Template by Hubspot
  • Business Plan Template by Sage

eCommerce business plan examples

It’s possible to get lost when planning your eCommerce business, so you should stick with some plan examples and use them as references. Below are some of the best plan examples that we have collected for you from Bplans . Though all companies in these sample plans are made up, they still give you some ideas on how a real eCommerce business plan looks like:

  • NoHassleReturn.com business plan sample
  • Gaian Adventure Fabrics business plan sample
  • Country Crockery business plan sample
  • ExpectingU.com business plan sample

Common eCommerce business plan mistakes

Making an eCommerce business plan is the very first step before you start working on your business, so you should try to make it as good as you can.  There are some mistakes you should avoid when making your plan:

  • Unrealistic plan: This is one of the most common mistakes you can make when creating your plan. Many aspiring business owners often overvalue their business ideas or underestimate how competitive the market can be. Therefore, try to create a plan that sounds possible with your ability and resources. You can adjust and refine your plan with your upgraded skills and experience as you learn more as an entrepreneur. 
  • Missing financial planning: This is a big hole in any business plan if there isn’t a proper financial plan. The numbers are actually the most important part, as they will speak for your business idea and the market it can thrive in. Without calculations and projections, all your plans are considered unrealistic.    
  • Bad business ideas: When you are fueled with a new idea, it always sounds great until you discover that the market doesn’t actually need it, or there is no market for you to sell your products. Therefore, in order to make sure you have come up with a sound business idea, it’s essential that you do some serious research, even before you start working on your business plan.  
  • False assumptions: If you do not have enough information about the background and characteristics of potential customers, it’s easy to make false assumptions about them, which leads to an invalid business plan.  
  • Unbalanced team: Having a great product is not enough to excel your business. A great team does. Many founders think they can handle everything by themselves while they actually lack skills related to business or administration, for example. Gathering a balanced team from the start can help your business plan work smoothly in operation.   

C reate your own eCommerce business plan today

Creating your own eCommerce business plan might require hours of brainstorming and research, but it gives you a comprehensive understanding of your own business and the market. Also, it helps identify clear steps on how to start your business and sets out a solid foundation for success. We hope that this article can help you and other aspiring business owners start working on the ideal plan for your dream eCommerce business today.   

How long should my eCommerce business plan be?

A business plan often ranges from 15 to 50 pages depending on your business situation and personal purposes. For instance, your plan can be around 15 pages if you write it for your own usage, while it can range up to 50 pages if you are trying to find an angel investor. Though there is no requirement for business plan length, it’s advisable that you keep it concise and focus on the most pivotal aspects. 

What is a good eCommerce business plan?

A good business plan should be able to go through all sections that we have mentioned in this blog with an easy-to-understand language. It should be filled with as many numbers and charts as possible, rather than assumptions and hypotheses only.  

How can I know if I need an eCommerce business plan?

A business plan is beneficial for everyone who is running or going to run a business. No matter if you are a start-up, or you have been running your business for a period of time, an eCommerce plan can give you an overview of your own business and discover aspects that need improvement. 

How is an eCommerce business plan different from a business plan for other company types?

An eCommerce business plan shares the same structure as a business plan for other company types. However, the online business strategy and plan might differ greatly from a brick-and-mortar store. For instance, a traditional retail store has to take care of a physical store, while an eCommerce business focuses on its digital storefront – the website.   

Should I write an eCommerce business plan even if I don’t need funding?

Yes. As we have mentioned quite a lot during our article, you still need to write an eCommerce business plan even if it’s for personal purposes only. 

I love Taylor Swift and watching Netflix.

Related Posts

Covid-19 has not only taken the e-commerce trend to a new level, but also made adjustments in various areas of life. The birth of a medical worker has grown. However, in order to get into graduate school under the residency program, you must provide certain documents. Although the residency application is just one part of them, I still need help because there are many candidates and I need to somehow stand out from them. I am looking for qualified authors.

I recently read another similar article “How to create your own marketing strategy for a website” I recommend it: https://blog.codeharbor.dev/2022/10/17/how-to-create-a-complete-marketing-strategy/

How to Make an Ecommerce Website with WordPress

Sam Lauron

Published: February 12, 2024

As a writer, I’ve spent a lot of time digging into different industries, from social media to sales to ecommerce.

woman makes an online purchase via an ecommerce website on wordpress

Being equipped with all of this information and surrounded by inspiring examples of successful ecommerce businesses, I’ve played around with the idea of launching my own ecommerce website someday.

Download Now: How to Launch a WordPress Website  [Free Guide + Checklist]

If I ever decide to launch an ecommerce website, I want to make sure I’m choosing the best platform to set it up for success from the start. WordPress is one the first platforms that comes to mind, so I set out to learn more about how to make an ecommerce website with WordPress.

What Makes WordPress Great for Ecommerce

I’ve used WordPress throughout my near-decade-long marketing career, so I’m familiar with its powerful capabilities as an open-source platform and website builder. However, my experience has primarily involved using its CMS to manage and publish blogs.

As I set out to create an online shop, I want to stick with a platform I’m familiar with. However, I also want to make sure WordPress is a good platform for an ecommerce business. So, I asked a couple of experts about their experience.

Here’s what makes WordPress a great platform for ecommerce businesses, according to people who have used it.

Ease of Use

For those without technical experience, navigating the website-building aspect of an ecommerce shop can be a challenge. Not only do you have to make your website visually appealing, but your ecommerce site must also function as a store. This includes having an inventory and operating a checkout, among other complex features.

With WordPress drag-and-drop themes , you can design a fully functional ecommerce website without creating a single line of code.

This approachable UI appeals to non-coders like Adam Young, the CEO of Event Tickets Center , an online ticket marketplace.

“As someone who has struggled with other website-building programs, WordPress's drag-and-drop feature is revolutionary,” says Young. “This simple solution streamlines product management and empowers users like me to easily customize the store's design.”

Customizable Themes

Choosing the right theme for your ecommerce website sets the tone for the rest of your experience. A theme is like a pre-built template that you can install and customize. Fortunately, there are over 20,000 WordPress themes to choose from, and nearly half of them are free.

As long as you choose a theme that’s designed for ecommerce, you’re off to a great start.

There are a few elements that make for a successful ecommerce theme. First, your theme should make it easy to visually display your store’s products.

Another element to look out for is a seamless checkout process. The last thing you want is for a customer to add to their cart but not complete the purchase because the process was confusing or unclear.

“I've noticed through personal experience that choosing an ecommerce-focused WordPress theme is like building a digital storefront,” states Young. “These themes are built to smoothly combine online transaction elements like user-friendly product lists, shopping carts, and checkout processes.”

He continues, “A WordPress ecommerce theme quietly guides customers to the ‘Add to Cart’ button and ‘Checkout’ page beyond aesthetics. It helps convert casual visitors into delighted consumers.”

planning online business in ecommerce

How to Launch a WordPress Website

Learn how to launch a website on WordPress with this step-by-step guide and checklist. Learn how to...

  • Set up your domain name.
  • Install an SSL certificate.
  • Analyze your content.
  • Back up your site.

You're all set!

Click this link to access this resource at any time.

Plugins that Scale

Another unique feature of WordPress is its plugins.

Plugins are like apps. Instead of learning to code when you want to add a new feature or function to your website, you can choose from one of the thousands of plugins WordPress offers. Plugins make it easy to scale your business.

“WordPress's scalability has helped me build and expand an online business,” according to Michael Wall, founder of Codefixer , a software development and growth agency. “As a tiny firm with a few products, the platform easily supported my product inventory growth.”

He adds, “Plugins were crucial to the success of my WordPress ecommerce website.”

When it comes to ecommerce plugins, specifically, Wall recommends WooCommerce (we’ll get into more details about WooCommerce later in this article).

“WooCommerce changed the game by centralizing product management, order processing, payments, and shipping operations,” says Wall. “This ecommerce plugin integrated effortlessly with my WordPress site, making daily operations easy.”

Large Community and Expert Network

WordPress was founded 20 years ago, making it one of the most established website platforms out there. And because WordPress is used by 43.1% of all websites , it’s safe to assume that you or someone you know has experience using the platform.

Whether you’re looking to outsource website development or connect with other website owners for advice, you won’t have to look far. The WordPress community is vast and knowledgeable. You can check out a freelance marketplace like Upwork to hire WordPress developers or join an online group to chat with WordPress experts.

To help walk through the steps when making an ecommerce website on WordPress , I’m going to set up my own sample website as an example.

For this example, I’m going to use WordPress.com to set up a basic ecommerce site. You can sign up for a free plan to get started or a paid one if you want access to more features right away.

How to make an ecommerce website with WordPress: WordPress offers six plans ranging from free to enterprise-level.

Don't forget to share this post!

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CMS Hub is flexible for marketers, powerful for developers, and gives customers a personalized, secure experience

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Best free e-commerce platforms in 2024

Mehdi Punjwani

Sierra Campbell

Sierra Campbell

“Verified by an expert” means that this article has been thoroughly reviewed and evaluated for accuracy.

Published 7:23 a.m. UTC Feb. 14, 2024

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Selling goods and services online is easier than it’s ever been, and it shows – revenue from the United States e-commerce industry is forecasted to exceed $1 trillion for the first time in 2024. This number had yet to reach $500 billion in 2018 and helps demonstrate the rapid growth of e-commerce in the U.S. over the last half-decade in particular.

Helping people all over the U.S. and the world start selling online are the various platforms that allow you to build and publish your own online store in minutes. While there are few truly “free” e-commerce platforms – many only offer free trials or free store-building while only offering selling behind a paywall – it’s not impossible to keep costs to a minimum. Our experts have reviewed free plans from some of the best e-commerce providers of 2024 on the market to find the best ones for your business.

Featured website builder offers

planning online business in ecommerce

Via Wix’s website

Monthly fee

Free domain

For one year

Drag-and-drop builder

planning online business in ecommerce

Via Shopify’s website

Squarespace

planning online business in ecommerce

Via Squarespace’s website

Best free e-commerce websites

  • Shift4Shop : Best for integrated payment processing.
  • OpenCart : Best for third-party integrations.
  • Square Online : Best for physical shop owners selling online.
  • Weebly : Best for startups.
  • Big Cartel : Best for creatives.
  • PrestaShop : Best for small businesses with tech experience.
  • Ecwid : Best for plugging into existing websites.

Why trust our small business experts

Our team of experts evaluates hundreds of business products and analyzes thousands of data points to help you find the best product for your situation. We use a data-driven methodology to determine each rating. Advertisers do not influence our editorial content. You can read more about our methodology below.

  • 15 companies reviewed.
  • 39 products reviewed.
  • 2,028 data points analyzed.

Best for integrated payment processing

Shift4Shop

Drag and drop editor

What you should know.

Formerly known as 3dcart before its takeover by Shift4 Payments in 2020, Shift4Shop is a capable, if simplistic, online shop solution with plenty of useful e-commerce features. It’s free forever so long as you use Shift4Shop’s payment processing system and process at least $500 per month in transactions. However, if you want to use another payment processor, you’ll need to pay – and while plans start at $29 per month if you use PayPal, there is little transparency with other pricing models.

While not as advanced or customizable as other platforms without coding knowledge, Shift4Shop’s e-commerce features are fairly robust. You’ll get unlimited products, product variants, product images and categories, a secure shopping cart, product and Google customer reviews, dropshipping, upselling and cross-selling. If you’re willing to use its integrated payment solution, then Shift4Shop could be a viable free e-commerce platform for your business.

Pros and cons

  • Free forever if you use Shift 4 Payments.
  • Wide array of e-commerce features.
  •  Unlimited products on all accounts.
  • Limited freedom to customize your website.
  • Pricing isn’t clear for payment processing.
  • Must clear $500 per month in transactions for free e-commerce.

Best for third-party integrations

OpenCart

OpenCart is entirely free and open source, and alongside its built-in e-commerce features, you’ll have access to over 13,000 third-party integrations to boost your online shop. As it’s open source, it’s extensively customizable – but it will require a bit of learning to fully take advantage. As far as e-commerce capabilities go, OpenCart claims to offer unlimited everything, so you’ll get as many products and product categories as you need.

While customizing every detail might take some time, OpenCart’s e-commerce features are user-friendly and accessible to beginners. However, you’ll need to pay for hosting, as OpenCart doesn’t offer it – although it does have recommended partners listed on its website. Note that for extra functionality, you might need to pay for certain extensions on its marketplace.

  • Free forever and open source e-commerce.
  • Unlimited products and categories.
  • Over 13,000 extensions on the marketplace.
  • Limited customer support.
  • OpenCart doesn’t provide hosting or maintenance.
  • Learning curve to fully take advantage of customization.

Best for physical shop owners selling online

Square online.

Square Online

Square Online is a powerful free e-commerce platform that integrates seamlessly with Square’s POS system – so if you run physical locations using Square, it makes sense to stick with them when you take your business online. All transactions automatically sync with Square POS and integrate with your inventory, and you’ll get discounts on shipping, pickup and delivery,

You’ll be able to accept a variety of payment types, although this doesn’t include PayPal with the free plan. Square’s free online plan also comes with unlimited products, pickup, local, delivery and shipping and SEO tools to amplify your online shop. It’s simple to build your shop website with a drag-and-drop editor, but you won’t get access to themes unless you’re on a paid plan. You’ll also have to tolerate Square adverts, and you won’t get a custom domain. Square charges relatively high processing fees compared to other platforms.

Learn More: Read our full Square review .

  • Integrates with Square POS – useful if you use it for your physical shop.
  • A range of useful e-commerce features on its free plan.
  • Easy to use drag-and-drop editor.
  • Free plan comes with ads, no custom domain.
  • Relatively high processing fees.
  • Can’t accept PayPal on free plan.

Best for startups

Weebly

Weebly is a powerful and affordable website builder powered by Square, with a range of useful e-commerce features, including inventory management, unlimited items, in-store pickup, vouchers and gift cards. Additionally, if you’re in the U.S., then your taxes are calculated automatically. However, the free plan doesn’t allow for digital goods, nor does it offer a shipping calculator, item reviews, shipping labels, abandoned cart emails or PayPal payments.

Weebly’s website editor is a straightforward drag-and-drop interface, easy for beginners, but it doesn’t offer as many unique themes or templates as other platforms, with only 15 for online stores. We’d recommend Weebly for startups that want to keep things simple – its paid plans are relatively cheap, ideal if you’re looking to scale up and keep costs low.

Learn More: Read our full Weebly review .

  • Easy to use website builder.
  • Paid plans are relatively affordable when looking to scale up.
  • Useful inventory management features.
  • Limited design options.
  • The free plan has ads and no custom domain.

Best for creatives

Big Cartel

Big Cartel is, in its own words, designed for creatives and artists looking to sell their work. The free Gold plan is fairly basic, only allowing five products and offering a limited suite of features – inventory, shipments, discounts and promos. Analytics and custom domains are only available for paying customers. However, this can suit creatives with limited product runs who want to focus purely on getting their goods out there — and the available themes are more on the artsy side, too.

There are limitations that make it less suitable for other businesses – even the highest tier only allows 500 products. There isn’t much room for customization unless you’re comfortable coding, and again, this is only available on paid plans.

  • Simple and easy to use.
  • Paid plans are very affordable.
  • Themes designed for creatives and artists.
  • Only five products on free plan.
  • Limited customization ability without coding knowledge.
  • Very few features and tools.

Best for small businesses with tech experience

PrestaShop

PrestaShop is another open-source e-commerce platform that offers the ability to fully customize your online shop. The catch is it’s not really for beginners. If you’ve got coding experience or experienced developers on deck with your business, then you’ll be able to take advantage of its comprehensive editor, but it’s not ideal for those wanting to quickly set up shop and start selling.

PrestaShop’s e-commerce platform gives you unlimited products and a range of tools for SEO, marketing, payment and shipping and advanced analytics. However, many of the extensions available to you are costly and can add up to a hefty sum. Additionally, you’ll also need to pay for support plans – they’re based on credits, and you can buy enough for one to 12 months of support from their technical team.

  • You can fully customize with its open-source platform.
  • It’s free forever unless you pay for extensions.
  • You can integrate a range of third-party payment processors.
  • It requires coding knowledge.
  • Third-party integration costs can add up.
  • You’ll need to pay for hosting.

Best for plugging into existing websites

Ecwid

Ecwid quite literally means e-commerce widget, and one of the biggest benefits of this company’s free plan is that you can use it to build your shop and embed it on any website you choose. If you’ve got an existing website for your business and you want to explore selling products, then Ecwid offers an economical way to test the waters.

While the free plan is limited in terms of the features you’ll get — significantly fewer inventory and marketing capabilities – on the e-commerce side of things, it’s still strong enough to get you started. You’ll only get five products, but you’ll be able to sell on multiple sites simultaneously, as well as use free templates to build your own site on an Ecwid domain.

  • Free version lets you embed your products on your own site. Paid plans are affordable when you want to upgrade.
  • Optimized for mobile.
  • Only five products on its free plan.
  • Many marketing and inventory features only on paid plans.
  • Only email support available on free plan.

Best free e-commerce platforms comparison

Methodology

We extensively research the key competitors within an industry to determine the best products and services for your business. Our experts identify the factors that matter most to business owners, including pricing, features and customer support, to ensure that our recommendations offer well-rounded products that will meet the needs of various small businesses.

We collect extensive data to narrow our best list to reputable, easy-to-use products with stand-out features at a reasonable price point. And we look at user reviews to ensure that business owners like you are satisfied with our top picks’ services. We use the same rubric to assess companies within a particular space so you can confidently follow our blueprint to the best free e-commerce platforms of 2024.

The best e-commerce platform has positive user reviews on customer review sites. E-commerce platforms should provide customers with fast and reliable support. Using a combination of phone support, live chat and knowledge bases, customers should be able to quickly resolve issues 24/7.

E-commerce platforms should provide businesses with the necessary tools to effectively run an online business. Platforms should be affordable compared to competitors. Expanding on easy-to-use website building tools, e-commerce platforms should combine payment processing capabilities with a robust set of online sales features.

All e-commerce platforms should allow online businesses to manage inventory, sell physical and digital products and offer services to customers. A network of integrations should be offered to integrate accounting, client relationship management (CRM), dropshipping services and omnichannel selling tools. Built-in tax and shipping calculators should be provided along with abandoned cart recovery tools to ensure a smooth checkout experience for customers. And mobile apps should make it easy for business owners to view transactions, reports and analytics. Finally, email marketing tools and social media integrations should be provided to help businesses capture prospects and turn them into sales.

What is an e-commerce platform and how does it work?

An e-commerce platform is software that functions as a content management system (CMS) and online shop, allowing you to sell goods and services and accept payments over the Internet. While the specifics will vary between platforms, most will allow customers to find products, store them in a cart and pay by card to complete their order.

Some platforms allow you to build your own customized website and sell your products through it, while others offer a more basic online store page on their own website. Some also offer other features alongside an online shop, such as invoicing and accounting, payment processing and security. When it comes to finding a free e-commerce platform, this usually means you’ll be able to have a free trial or enjoy access to limited features before paying for full functionality.

Benefits of an e-commerce platform

If you’re a beginner to e-commerce, whether you’re new to selling or you already have a physical shop, you might be wondering what advantages there are to using one of these platforms. Here are the main benefits of using an e-commerce platform for your business:

  • Reach an international audience 24/7: With an online shop, you won’t be limited to those who can physically reach your store – the whole world can access your shop at any time of day. Just keep in mind you’re dependent on technology and the internet, so if this goes down, so does your shop. 
  • Scale up with fewer overheads: Scaling up will cost less, too, as you’ll face far fewer overhead costs that are associated with having a physical shop. The flip side is that competition is much higher when the internet is your playground, so you’ll need to work harder at marketing and outreach to stand out. 
  • Avoid the hassle of a physical shop: You won’t need to worry about property damage or shoplifting as everything is online behind a screen. However, the threats are different for e-commerce, not absent completely – you’ll need to ensure you have robust cybersecurity to protect yourself and your customers. 
  • Automatically track sales and inventory: The digital nature of e-commerce means more of your sales and inventory numbers are automatically tracked, so you don’t have to take a product inventory. However, this presents a different issue of shipping logistics, as customers aren’t collecting their goods when they visit your store, so keep this in mind when managing orders.

Who needs an e-commerce platform?

An e-commerce platform can be a useful option for a range of business types. You might be a new seller working from your own home, or you might have an existing physical store and are looking at expanding your reach. 

You could even be thinking about making the swap to online-only, and with the benefits listed above, it can be an attractive option for many. With the chaos of COVID aside, e-commerce sales as a percentage of total retail sales in the US have been steadily rising for years — reaching 15.5% in Q1 of 2023.

There is enough variety in the platforms available that anyone from a beginner entrepreneur to an experienced web designer can create unique and attractive online storefronts for their products. You won’t need to code anything if you don’t want to, but some platforms will let you customize every single aspect of your store, track your sales and inventory and reach new and existing customers through digital marketing.

How to choose the best e-commerce platforms

To choose the best e-commerce platform for your business, you’ll need to consider a few important factors that can vary between providers. For example, you should think about how easy it is to use, what features are available, how much you can customize your online shop, what support you have access to and how much it’ll cost. Consider your own needs and the specific requirements of your business when thinking about these factors to ensure your chosen platform offers everything you need while keeping costs at a minimum.

Key features to look for

Consider the following features when comparing e-commerce platforms:

  • Online shop: The fundamental feature of your chosen commerce platform is the online shop itself. You know your customers best, so look for things like navigation, search, reviews, videos, return policies and other crucial aspects that visitors will benefit from when they shop on your online store.
  • Payment processing: Once people have picked their items they’ll need to pay for them, so ensure you’ll be able to take a variety of payment methods that reflect your customer base. Keep the cost in mind too, as different platforms have different payment processing rates and price models.
  • Content design and blog management: As well as setting up shop, you might want to build content around it. It could be as simple as an integrated blog or a fully customized website with unique content coded to the letter – find a platform that offers design features that match your expertise.
  • Marketing, outreach and promotions: Many e-commerce platforms offer the ability to reach out to existing and potential new customers through marketing tools like emails, loyalty programs, promotions, vouchers and discounts. 
  • Inventory and sales tracking: A significant advantage of digitized recordkeeping is the automation of sales and inventory tracking – so ensure your platform gives you adequate tracking ability to help keep on top of your stock.
  • SEO analytics, reporting and optimization: Keeping your website and shop visible to Google searches is crucial, so look for a platform that offers optimization as well as a view of analytics to see where you can improve and boost visibility.
  • Security: Finally, ensuring your customers’ payment data stays safe and secure is important for them as well as your business. Pay attention to the security features offered by different platforms to ensure they’re extensive and robust.

UX and ease of use

When it comes to designing an online shop and website, different platforms offer solutions that cater to varying levels of expertise. Beginners with little experience putting a website together might prefer either a simple shop with little customization and more focus on products. 

However, drag-and-drop editors are fairly common and allow anyone to build an attractive and professional online shop with relative ease. For those with more advanced technical skills, other platforms will let you code your entire website and store from scratch – perfect for developers or those with the budget for one.

Customer service

Unfortunately, one of the negative aspects of using an e-commerce platform is that you’ll be at the mercy of technology. This is why it’s so valuable to be able to rely on your provider’s customer support – so bear in mind their methods of contact as well as their hours of availability. 

Customer service that’s available 24/7 is ideal, especially since online shops are generally open around the clock, and you’ll want to be able to resolve issues as soon as possible. Phone or live chat availability is also preferable, as you’re more likely to get an instant response compared to email support.

Software integrations

If you have an existing setup for other aspects of your business, like accounting, analytics or inventory management, it might be beneficial to look for providers that offer integrations. This can save time when setting up your online shop, knowing that you’ll be able to link services you already use and trust to make your operation run smoother.

How much do e-commerce platforms cost?

Frequently asked questions (faqs).

The best e-commerce platform for you will depend on your technical ability, business requirements and the type of company you run. Expert coders and developers might prefer open-source platforms like OpenCart, PrestaShop or Shift4Shop, while if you’re new to e-commerce, you might prefer the head start given by Square or Weebly. Big Cartel is a great option for creatives, and Ecwid is a useful plugin for existing websites.

Creating an e-commerce website for free is fairly straightforward – you can sign up with a platform that offers a free trial or that allows you to build your site at no cost but for which you’ll need to pay to publish and sell products. Unfortunately, there isn’t really a completely free way to set up an e-commerce website, as you’ll also face other inevitable costs like payment processing and domain hosting.

You can make money in a variety of ways with an e-commerce website – from relying on third-party services for methods like dropshipping or print-on-demand models to taking advantage of the online space by creating digital products. 

You can offer automated subscriptions for users who want to make regular purchases, advertise a service you offer, such as tuition or cleaning or even get involved in affiliate marketing for other brands. E-commerce websites offer a range of profit-making models, so your options for making money are wide open.

When looking for an e-commerce platform, you should aim for one that matches your level of expertise and experience when it comes to building an online shop or website. Ensure it has all the features you need to run your e-commerce business, whether it’s accounting, inventory or marketing.

Bear in mind the customer service you’ll have access to, both in terms of availability and contact methods. Finally, ensure it’s something you can afford, particularly in the long term, as you look to scale up your business.

You can create a free e-commerce site in WordPress.org if you’re comfortable with coding and developing, but WordPress.com only offers e-commerce features on its Entrepreneur plan at $45 per month.

No, Wix does not offer a free e-commerce platform. Plans start at $16 per month, but for e-commerce features, you’ll need at least a Core subscription at $27 per month.

Yes, Weebly’s cheapest plan with e-commerce features is free.

Blueprint is an independent publisher and comparison service, not an investment advisor. The information provided is for educational purposes only and we encourage you to seek personalized advice from qualified professionals regarding specific financial decisions. Past performance is not indicative of future results.

Blueprint has an advertiser disclosure policy . The opinions, analyses, reviews or recommendations expressed in this article are those of the Blueprint editorial staff alone. Blueprint adheres to strict editorial integrity standards. The information is accurate as of the publish date, but always check the provider’s website for the most current information.

Mehdi Punjwani

Mehdi is a writer and editor with many years of personal finance expertise under his belt. He's a spirited money-saver, with a passion for making personal finance accessible and manageable. When he isn't writing, Mehdi likes to read about history and travel, hike along coastlines and in forests, and watch his beloved team Manchester United underperform.

Sierra Campbell is a small business editor for USA Today Blueprint. She specializes in writing, editing and fact-checking content centered around helping businesses. She has worked as a digital content and show producer for several local TV stations, an editor for U.S. News & World Report and a freelance writer and editor for many companies. Sierra prides herself in delivering accurate and up-to-date information to readers. Her expertise includes credit card processing companies, e-commerce platforms, payroll software, accounting software and virtual private networks (VPNs). She also owns Editing by Sierra, where she offers editing services to writers of all backgrounds, including self-published and traditionally published authors.

How to start a small business: A step-by-step guide

How to start a small business: A step-by-step guide

Business Eric Rosenberg

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  4. Starting an online business? Here are 9 tips to build a most efficient

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COMMENTS

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

    Manage cookies How to Write an Ecommerce Business Plan [Examples & Template] Download Now: Free Business Plan Template Kayla Carmicheal Published: January 11, 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.

  2. How To Start an Ecommerce Business: Guide for 2024

    1:43 Learn More Start an ecommerce business in 5 steps Find product opportunities and choose what to sell Thoroughly research your competition and write a business plan Choose a logo and name and set up your online store Choose your shipping strategy and set sales and marketing goals Launch your business 1.

  3. How To Create an E-Commerce Business Plan in 8 Steps

    The Upwork Team Oct 24, 2022 | 10 Min Read Sales & Marketing Article Writing a comprehensive business plan should be one of your first priorities if you're thinking of starting an e-commerce business. A business plan is a roadmap with milestones that help you achieve your company's main goals and stick to your strategies.

  4. Ecommerce Business Plan (FREE How To Guide + PDF Sample Template)

    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.

  5. How to Start an E-Commerce Business in 2023: A Step-by-Step Guide

    5. Figure out order fulfillment. Order fulfillment is the process of getting customers' purchases in their hands. Most e-commerce website builders offer shipping label printing, which is the ...

  6. How to Write the Ultimate eCommerce Business Plan

    Writing an eCommerce business plan is one of the first steps you should take if you're thinking about starting an online business. Whether you're opening an online-only shop or adding an eCommerce component to your brick and mortar store for an omnichannel retail experience, there's never been a better time to sell online.

  7. How to Start an E-commerce Business: A 2024 Guide

    Step 3: Choose a business name and start building your brand. Next, your business needs a name and brand identity. For those starting white label e-commerce businesses, the brand is especially crucial to the success of your business. Choosing a business name can be fun, but it requires a bit of strategic thinking.

  8. A Better-Selling Ecommerce Business Plan (Template, Guide ...

    Yes. Every ecommerce company can benefit from a solid business plan. Here are the main benefits of creating a business plan: If You're Just Starting Out: A business plan will help you set clear goals and create an action plan to achieve them. It will also help you realistically estimate and budget for the costs of your new business.

  9. How to create a defensible eCommerce business plan

    Include your company name and description. In this section, you'll want to outline the who, what, and why of your business. Rather than going into details about the products you plan to sell (this comes later), talk about your vision for the company. Share your motivations, values, and problems that you plan to solve.

  10. Ecommerce Business Plan: How to Write + Strategies for Success

    The key elements of an ecommerce business plan template describe blueprints for growth, projected timelines and financial goals — clarifying topics like cash flow, expenses, marketing tools and distribution channels. An executive summary provides a concise rundown of the key points in your business plan.

  11. How to Start an Ecommerce Business: 2024 Edition

    1 How to start an ecommerce business: 5 steps to launch 1. Find products to sell → Click Here to Launch Your Online Business with Shopify How to source your products 2. Analyze the competition 3. Write a business plan 4. Choose a name and logo 5. Build your online store 6. Choose your sales and marketing channels 7. Launch your business

  12. How (and Why) to Write Your Ecommerce Business Plan

    An ecommerce business plan will act as the guide describing the how's and why's of your future business. The plan should include the following: Values that the business will offer to customers and clients. These can include finances, time, convenience, and customer service. How and when your ecommerce business will be profitable.

  13. How To Write a Business Plan for Your eCommerce Startup

    Here's a step-by-step guide on how to create a business plan for your eCommerce startup: 1. Write an executive summary. While this is the first section that appears in a business plan, it's usually the last section to be drafted. That's because it summarizes other parts of your eCommerce business plan.

  14. E-Commerce planning process

    1. Learn the 6 key steps of the e-Commerce planning process. 2. Understand how to identify and validate e-Commerce opportunities and the pros and cons of different e-Commerce channels. 3. Learn the objectives and activities you need to create successful online selling experiences.

  15. How to Write an eCommerce Business Plan + Template

    Updated November 13, 2023 Free Download: Sample eCommerce Business Plan Templates If you're starting an online eCommerce business, it's tempting to dive right in and set up your digital shop. After all, eCommerce businesses are often less expensive to start than physical businesses and the risk may seem lower. Unfortunately, that's not the case.

  16. How To Start an Ecommerce Business: Guide for 2023

    1. Find product opportunities and choose what to sell Finding a product to sell The first step to building an ecommerce store is knowing what products you want to sell direct-to-consumer. This often is the most challenging part of starting a new online business.

  17. How to Start an E-Commerce Business In 2024

    E-commerce is more popular today than ever before. In fact, the number of e-commerce websites has increased from 9.2 million to 26.5 million between 2019 and 2023. If you're looking for a way to ...

  18. A Step-by-step Guide to Writing an eCommerce Business Plan

    Here is an outline of the different sections that you can use to ensure that all the most important details are included. 1. Executive summary. While an executive summary is only a single page, it is one of the most important sections in your business plan. It's here where the readers will get the main synopsis of your eCommerce business.

  19. How To Write an eCommerce Business Plan: Tips & Examples

    Step 1: Define Your Business Concept. When writing a business plan for your new business, begin by clearly articulating your eCommerce business concept. This is like a company overview. Outline not only the products or services you plan to offer but also the underlying mission and vision that drive your business.

  20. How to Start an Ecommerce Business: A Simple 7-Step Guide

    5. Write a Business Plan. Your ecommerce business plan should outline your company's goals, the strategies to achieve these goals, plus your target market, financial projections, and operational structure. This document should act as a reference point and a roadmap for your business. And answer some important business-focused questions.

  21. How To Make an E-commerce Business Plan

    A good e-commerce business plan is driven by research and data. To keep it smart and realistic, update your forecast by identifying what works and what doesn't. Seek opportunities to sustain the financial growth of your e-commerce business, and your growth as an e-entrepreneur. Good habits help you grow faster, keep on learning, and expand ...

  22. How to Create an Ecommerce Business Plan in 2023

    26 min Updated: Nov 11, 2023 Do you need to launch an ultra practical online business? It all starts with a pre-meditated ecommerce business plan. At first glance, this feels like a superficial blueprint for most starters. But here's the deal.

  23. Ecommerce Business Plan in 2023: What Is It and How to ...

    5. Customer analysis. Analyze your customer groups to craft an ideal customer profile - the foundation of your marketing plan. Your ideal customer profile should be as specific and descriptive as possible, as many strategic decisions in your business operations will be made based on this profile.

  24. How to Make an Ecommerce Website with WordPress

    As I set out to create an online shop, I want to stick with a platform I'm familiar with. However, I also want to make sure WordPress is a good platform for an ecommerce business. So, I asked a couple of experts about their experience. Here's what makes WordPress a great platform for ecommerce businesses, according to people who have used it.

  25. Building an E-Commerce Website: 11 Experts Offer Best Practices

    By Brett Farmiloe. A website is a crucial part of your e-commerce business, so what is one key step that's necessary to build a successful e-commerce site?We posed that question to entrepreneurs and small business owners to find out their best advice. From investing in AI chatbots to optimizing the checkout process, here are 11 best practices for building a successful e-commerce website.

  26. E- Commerce Marketing In 2024: The Ultimate Guide

    E-commerce, short for electronic commerce, is the method of buying and selling on the internet. This digital marketplace has become a pivotal part of the global economy with a whopping $6.9 ...

  27. E-Commerce Strategy: The Ultimate Guide

    An e-commerce strategy is an organized set of plans or tactics that help your business sell products or services online. It takes a strategic approach to marketing your offerings so you can drive ...

  28. Shopify Pricing in 2024: Is it Worth the Cost?

    Shopify has three main e-commerce plans businesses can choose from as well as a Starter plan for those mostly interested in selling on social media. ... The Shopify plan fees for online payments ...

  29. Best Free E-commerce Platforms in 2024

    Selling goods and services online is easier than it's ever been, and it shows - revenue from the United States e-commerce industry is forecasted to exceed $1 trillion for the first time in 2024.

  30. Sellfy Review: The Best E-Commerce to Sell Products in 2024?

    A Business plan is perhaps the best value, though you can upgrade further to a Premium plan with up to $200K in annual sales once your online store takes off. Alternatives to Sellfy Sellfy offers a robust option to help you start selling digital and physical products, but it isn't the only player in this space.