Planning Your Online Business - Practical Considerations

A well-thought-out plan to that guides your actions in starting and running your business is important to your success.  And while a tradition brick-and-mortar business would need a detailed, written formal business plan, your plan needn't be as formal or complicated, if  you are just looking to start slowly. 

Unlike traditional businesses, many online businesses can be started on a shoestring budget, without outside investment and with very low risk.

This does not mean you should do no planning at all; only that you probably do not need a formal, complicated business plan to get started. Since you will be investing almost no money to get started, we'll keep the planning simple.

Practical considerations

Strategic planning is matching the strengths of your business to available opportunities. To do this effectively, you need to collect, screen, and analyze information about the business environment. You also need to have a clear understanding of your business - its strengths and weaknesses - and develop a clear mission, goals, and objectives. Acquiring this understanding often involves more than you may expected. Many businesses fail because they didn't take the time to research and plan the business first.

You must realistically assess the business you are convinced you know well. If you are to survive and prosper, you should take the time to identify the niches in which you are most likely to succeed, and to identify the resource demands that must be met. Learn more about this topic.

Your plan needs to include:

You needn't write down the answers to all these questions, but you should consider each and answer them to yourself.  If you can't answer these questions, or the answers are negative, you'd better reconsider your idea or do more research to find solutions.

  • What will I sell?
  • How will I sell it?
  • Who else is selling it?
  • Are they successful (profitable)?
  • If so, what are their strengths and what makes them popular?
  • What skills, tools and other resources will be neded?
  • Do I have the skills and resources needed?
  • What are the costs (tools, software, computer)?
  • What is the current price for these items, and what are the highs and lows in the past 10 years?
  • What will make my business more appealing than existing businesses selling the same items.
  • How will I collect payment (including taxes)?
  • How will I ship the items?
  • How will I handle returns and disputes?
  • How will I handle tax payments and accounting?
  • What happens if the business grows? How will I handle growth?
  • How long will it take to become profitable?
  • How will I know if the business is successful?

Guidance to Practical Planning

Writing formal Business Plans