Planning is essential to establish that your new ecommerce website can and will make money. If it doesn’t make sense in a Spreadsheet, it won’t work in your business!
You need to find out:
- If there is a demand for your product online?
- Are the products you intend to sell actually selling online and in what numbers?
- What are your competitors’ prices like? Are they charging less than you can buy the product for at trade price? This can happen online.
- Will your e-commerce website be profitable?
By being disciplined in this area you now have a good idea if your business and ecommerce site ideas are viable and profitable. Be very honest with yourself as most people fail at this point. Look for any leaks in your numbers and document your actual sales on a spreadsheet, against your forecasted numbers as you start to trade and progress. This will keep you on track.
When your site is trading you must monitor key accounting areas at least weekly – especially your sales and costs (P&L = Profit & Loss), and the resulting net profit (bottom line).