Checklist For Your New E-Commerce Project

We have worked on many e-commerce projects with entrepreneurs, in some since the beginning of the business plan, and in others with the business already underway. In all this time we have seen some that have started with great enthusiasm but have not managed to consolidate.

In many of these failed projects, we have seen problems from the beginning. That is why we have prepared this small checklist of points that, if they had been considered at the beginning of the e-Commerce project, would have avoided many problems later.

Check If Your Product Is Salable On The Internet

Not everything can be sold on the internet or, at least, not profitably. Think about your product and its peculiarities. Think about things related to products and logistics.

Is your product easily transportable ?: In electronic commerce, a fundamental point is the logistics of storage and shipping. Check the shipping costs of your product and if they are acceptable. Your product may be excessively large or heavy and this makes it very difficult.

Logistics in an online store is key to its success.

Price and margins: Think about how much margin your products have. If your products have little margin you will need a lot of sales volume to cover costs. If so, keep it in mind in your marketing plan as you will need to attract a lot of traffic to your website. Look at the prices of your competitors and what price you could put to see if you are in the market.

Is your product in demand? Before starting to create an online store, check if your products are in demand. You can test it by looking at search statistics ( Google Trends, Google Keyword Tool ) about products, competitors, social networks.

Analyze how is the behavior in other markets of companies similar to yours. Some markets set trends and in many cases, if the products work in them, they reach our market in not too long.

Think Very Well About The Size Of Your Technology Platform

Another area that is very important to think about is the technology platform to use. In the market, there are multiple e-commerce platforms and all of them have their potentialities and weaknesses. Things like the following must be taken into account when choosing the most suitable platform.

How many products will you have on your website? It is not the same to manage 100 references than 20,000.

How many concurrent users do you think you will have? It is not the same to manage 5 users at the same time as 200.

Will you sell in more than one country, with different prices and multi-language? A more powerful platform means more powerful servers, more complex development, and ultimately higher costs.

Depending on what you have answered, you may have more basis to choose a technological platform that does not fall short and is not oversized. The choice of platform will also lead to different development and maintenance costs. Not just develop and maintain a WooCommerce store if you need a platform like Magento.

Think About The Legislation Applicable To Electronic Commerce

Electronic commerce is fully regulated. By-laws have indeed been made obsolete, but it is fully legislated. Think about your future sales processes and operations within your company to ensure that it complies with the legislation. Complying with taxation and legislation carries a cost, so you should take it into account in your financial plan.

Think About How You Are Going To Put Your Store On The Market

Technically developing a great e-commerce platform is not enough. You have to think about how you are going to drive traffic to your website.

For your plan, you can start to think about the number of visits you need to meet your sales goal. You can make quick numbers taking into account the conversion rate you estimate for your website and the average ticket you expect from your sales, and with this, you can calculate how many visits you need to reach your sales goal.

Now that you know more or less the traffic you need, prepare a marketing plan template to achieve it. Consider all the tactics you can use, such as SEO, search engine advertising, social media, social media advertising, or email marketing. Detail each channel and its actions to get an idea of ​​the marketing investment you need.

Prepare A Good Financial Plan

If at the moment you have managed to answer the previous points, you are ready to do many numbers. Preparing a financial plan is critical to the success of your business. You have to take into account things like the expected costs both in the operation of your company and in the development.

With these data, calculate when you will break even. For this you can use the formula:

Break-even point equals fixed costs / (sales – variable costs).

This will give us an idea of ​​how much we have to sell to cover the costs. This is the first calculation that we must do, but we have to consider that it does not take into account the cost. Until we manage to sell the necessary quantity to break even, a few months will pass in which we will have to pay our warehouse, salaries and, in short, all our expenses. For this reason, we will have to calculate what resources we need to be able to support the operation of the company until reaching the break-even point. When we have this amount, we will have to make a cash flow projection to know how the cash flows will work.

In many cases, your business may be profitable but the company has to close because it has not had the necessary resources to reach profitability.

All these calculations are predictions, so to have multiple scenarios, it would be interesting to make an optimistic and a pessimistic prediction and stay with something in between. Many times we are optimistic and then expenses appear that were not initially contemplated.

To try to refine the marketing expenses we can take into account the sales we need and with an expected conversion ratio (we must think that the average is usually over 1%), calculate how much traffic we will need and what advertising costs we will need in search engines (AdWords), social networks, organic positioning, and other marketing actions.

We hope this article helps you plan your e-commerce business and help you succeed. Of course, if you need help with the development of your store, e-commerce consulting, or the marketing of your company, you can count on us.