Building A Business Plan For An E commerce project

Building A Business Plan For An E commerce project -...

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Building A Business Plan For An E-Commerce Project By Brian Walsh If you're the manager of a proposed new e-commerce site, you have to take the good news with the bad. The good news is that there's still lots of opportunity for growth. The bad news is that you have no room for mistakes. While the e-commerce market is still in its infancy, if you're starting now, you're starting late. Your board of directors knows the Dell and Web success stories, and the expectations are high. So are the stakes: The price tag for a business site of even moderate complexity will easily outrun the cost of most luxury homes, and you'll still be building it a year after you start. And for all that expense, developing an e-commerce site carries a fair share of risk. Not all projects will be on time, on budget, deliver all promised features or reach all projected customers. To give yourself the best shot at e-commerce success, you must create a solid business plan; successful sites just don't spring up with borrowed talent and haphazard funding. For our purposes, an e-commerce business plan will describe the fundamentals of your business--all Internet development activity must feed an overall business goal--as well as provide guidance for staff and implementation, and forecast capital payback and profitability. The trick to formulating your plan is to encourage flexibility and creativity, and to remember that the plan describes a project; don't let it become an overwhelming project in itself. Answering the Basic Questions You may not realize it going in, but implementing an e-commerce site makes you an entrepreneur. Your site will turn a profit, break even or lose money based on its cost versus revenue from goods sold. Management won't release capital until it can see when, and under what conditions, its investment will pay off. Whether your site represents a start-up company or a division of a larger corporation, there are several strategic questions you must answer: What is our competitive model? What issues will we have with our channel? Which of our products does it make sense to bring online? Once you have addressed the macro issues, a second level of questions arises: Who will we reach with this site? Is our message aligned with corporate goals? When will this site make money? What tasks and technology will make it a success? And where will we get the resources to bring it to fruition? Your answers will be delivered in what is essentially a four-part plan: marketing, business, project and staffing. (A discussion of the project segment could probably fill this magazine on its own, and is outside the scope of this article.) Together, they match technology, external resources and your firm's strengths to market opportunities. Marketing: Think "Outside the Box"
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