15 Essential Tips to Make a Financial Plan for a Successful Ecommerce Business

While planning for an ecommerce business, it seems much cheaper than the traditional business setup. Though it is true to some extent there are certain things that needed to be considered before setting up your ecommerce business. Let’s find out the 15 tips to make a financial plan for your ecommerce business in this article.

While planning for an ecommerce store first and foremost you will need the basics things like:

1. Computer or laptop

2. Internet connection

3. Products or the service you are going to provide.

But other than these all you need is an ecommerce website. And there are more things that an ecommerce store needs than expected. So, it is advisable that you go through this article thoroughly so you don’t get stuck or lost in this business.

15 Tips to Make a Financial Plan for an Ecommerce Business

Let us explore the tips one by one for making your ecommerce business with a great financial plan.

#1 WEBSITE BUILDERS

Creating an ecommerce store needs a website. Because you need a website of your own to showcase your products or services. And for this, you have to pay for the domain name, SSL certificate and for hosting.

There are lots of website builders, but take a look at the 13 best ecommerce website builders which will be very much useful for building your online store.

There are a lot of websites that are available for free, but when you need to be the best, with more customization with looks, design and quality then you have to pay for the website builders which you must add to your financial plan.

#2 PAYMENT PLATFORMS

Though you own your ecommerce website, the payment will be done by a third party. In an ecommerce business, the products are sold online, this can be done on your own website or you can be a seller on another website like Amazon, Flipkart, or Meesho.

However, whichever method you choose to sell your products, or do your services the payment will be done with the help of a third party only. You have to pay monthly or you can choose a certain percentage for each sale. And this gets a bit higher in both cases.

#3 Permits and Licences

There are some permits and licenses that you must be aware of and must get for your ecommerce business. Though you are running an ecommerce store, it doesn’t mean that you will be exemplified by certain things.

There are some ground rules for all businesses irrespective of the type of business. And they are,

1. General business permit

2. Doing Business As a license

3. Professional trade license

4. Health Inspection certificate(in case you are selling food products).

#4 Utilities

Doing online business doesn’t cut down your electric bill, but it increases for sure. You need a stable internet connection around the clock all through the year and you must need some other electronics as well that need an electric supply.

Like printing the shipping label and so on. So add this electric charge to your financial plan for your ecommerce business.

#5 Shipping

Shipping charges will be daunting till you reach an exemplary level. Till then, the shipping charges, return charges everything will be an additional debt for you.

So don’t forget to have a certain financial plan budget for shipping charges when you set out with your ecommerce business. Though there are lots of logistics to help you with your delivery and shipping, consider having a look at the best logistics that might help you.

#6 Returns and Refunds

You must accept returns and refunds in online business. If you are looking for customers in the long run then you must bear all these expenses.

So, it is advisable that you make personalized financial plans for the returns and refunds for your products.

#7 Maintenance

This comes unannounced if you didn’t make this into your financial plan listings. Yes, the maintenance for storing your products, and your assets is mandatory.

Though the expense doesn’t come every month they will need particular money for maintenance. So it is advisable to put in some every month for this so that you don’t run out of money when the actual crisis pops in.

#8 Management

It is vital that you impose software for tracking your orders so that you can easily track and manage your products.

And avoid them being misplaced, theft or any damage that may occur. This will help you to know where the mistake is done and will help you to cut it down the next time. And also helps the smooth delivery process from your inventory to the customer’s door.

#9 Storage

As your business grows, so does your storage place expands. So you have to spend for rent for the storage and shelves cost if your products are in the warehouse.

Keep in mind this expense in your financial plan when you set out for an ecommerce business.

#10 Advertising & Marketing

Both advertising and marketing are a kind of investment than an expense in regard to business. Yet, they come under a financial plan so consider spending about 7- 12 percent of your revenue on this.

Marketing and advertising for your ecommerce business can be done in many ways and all these will ensure to promote your business for higher returns.

#11 Subscription

Though there is much free software available, yet there is a handful of software that will be helpful for running your ecommerce store.

Some of the software is worth getting a subscription to as it will be of much use to you. And don’t forget to add this to your financial plan as it will cost a fortune.

#12 Transactions

As said earlier the payment process and transactions are done online. So there is a certain fee for each purchase the customer does.

Get to know the policies, and regulations of each of the payments you tie up and pay accordingly.

#13 Cybersecurity

Cyberattacks are the new threat the ecommerce business is facing nowadays. As new technology emerges so do new attacks.

So it is crucial that you invest in good cybersecurity and choose a plan to protect your website from malware or attacks or any hacking.

#14 Insurance

Though you aren’t running a traditional business that needs insurance, you will be in need of insurance for your ecommerce store.

You have to know that you need liability insurance, product liability insurance and also interruption insurance in case of any disaster. Thus, include the insurance cost in your financial plan when you allot the expense.

#15 Tax

Taxes are inevitable irrespective of any work you do. This is the same as your e-commerce store.

So get ready to pay your taxes and don’t forget to add this expense to your financial planning.

Wrapping Up

Expenses are a must for your ecommerce business, and all these 15 will be useful for you to sort out your expense. All these fifteen tips are a must for your online store and they can’t be negotiated. But you can analyze and choose the best that suits your needs and requirements.

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