Online Shop Business Plan Sample

This is an example of a business plan for an online business that will import design products and so called “Kawaii” items from China. These are then to be sold in Germany and later other parts of Europe and the US as well.

“Kawaii” is a Japanese expression that translates to “lovable”, “sweet” or “cute”. These characteristics have been important design elements in Japan but have found a wide international audience via products like Pokémon, Mangas and Animes. The international target group first consisted mainly of children/young adults, but meanwhile there is a growing fan base among adults as well.

One specific strength of this start-up consists in the founder’s excellent language skills (Chinese, English and German), which in combination with a clever marketing strategy sets the company apart from the competition and constitutes a major advantage.

The business plan elaborates on crucial points like the product and its varieties, provides a brief overview of the market situation (a growing worldwide interest in Asian products and an international demand that can be gauged according to the demand in the primary markets China and Japan). A central location from where major hubs within Europe can be reached easily is another advantage of this particular company.

The plan also gives information regarding business partners (i.e. an already established Chinese partner company), the marketing plan (which includes social media as well as affiliate marketing), the venue organization (distribution via such venues as ebay and Amazon) and financing.

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Online Shop Business Plan Sample Overview

Executive Summary
Product Range
Unique Selling Points
Market
Location
Competition Survey
Risk Analysis
Marketing Plan
The Enterprise
Organisation
Finance Plan

1. Online Shop Business Plan Sample – Executive Summary

The [Online Shop Business Plan Sample] STARTUP will import design products and Kawaii items from China through an online shop and sell these in Germany, then throughout Europe and the USA. Kawaii is a Japanese word meaning “adorable”, “sweet”, “cute”, “childlike” or “attractive”. It also stands for an aesthetic concept emphasizing innocence and childishness and has spread to all parts of Japanese society. In Western languages, Kawaii has become established as a term for Japanese-influenced cuteness.

Japanese Anime, Manga and Kawaii culture has been an integral part of the international youth scene for many years. Meanwhile a viable market for products in this area has formed and aging generations of fans of this style have come to comprise an affluent consumer base. The development in this niche market has made it possible for specialized companies to operate profitably solely by selling traditional goods. These typical products also include Kawaii products.

The [Sample Business Plan] STARTUP will obtain Kawaii items from an established Chinese partner company and distribute them via an online shop for such goods. The company has reliable and cheap sources of supply in China. It wants to take advantage of the growing worldwide interest in Asian products and sell quality goods to a broad target group. They will be sold by their own eBay and Amazon store.

The startup benefits from the modern business concept, a reliable, existing supplier and a positive situation competition-wise. [Online Shop Business Plan Sample] FOUNDER NAME is therefore likely to be able to position [Online Shop Business Plan Sample] STARTUP successfully.

2. Online Shop Business Plan Sample – Product Range

The product range of [Online Shop Business Plan Sample] STARTUP will include textiles, toys / home accessories and office supplies in the Kawaii look. As already mentioned, Kawaii (Jap. 可愛 い or か わ い い) translates as lovable, sweet or cute. In Japan it has been used as a popular design element since the XXs, but these products arrived in the west only around the turn of the century. The best-known representatives in the west are “Pikachu” (Pokemon) and “Hello Kitty” products. First known as children’s toys, Kawaii products are getting more and more popular with adults. Stationery, fabrics, bags and accessories are particularly trendy.

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Image: Kawaii style illustrations, Google image search

[Online Shop Business Plan Sample] STARTUP’s offer will be based on market demand, which can be perceived very well by how such products are accepted on primary markets such as Japan and China. When demand is high, European consumers in all likelihood will also demand large quantities of these products. If the products do not penetrate the market in China and Japan, this will reflect on Europe accordingly, with the possibility of production ceasing immediately.

The mostly meticulously and lovingly designed products often originate with Japanese anime characters like the classic “Sailor Moon”, “Milan Superstar”, “Dragon Ball Z” “Pokemon” or “Digimon”, but also some new, highly successful brands such as “Yu-Gi-Oh “,” Inuyasha “and many smaller brands. All these series function based on the same principle, but appeal to different audiences. The target group for the product range is very broad since the products are popular with all age groups.
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3. Online Shop Business Plan Sample – Unique Selling Points

[Online Shop Business Plan Sample] STARTUP has advantages over the competition in that it already has reliable trade partners in China ([Online Shop Business Plan Sample] PARTNERFIRMA), from whom it can procure high-quality goods. Robust, lasting products and fair prices as well as a comprehensive product range and fast transport are among the startup‘s strengths.

The relatively excellent customer service ensures that all complications for customers will efficiently be eliminated. The [Online Shop Business Plan Sample] STARTUP will stand strong against the competition, and customer needs will be met to their full satisfaction. Moreover, the very specific and extensive product knowledge is another benefit of the founder. A clever marketing strategy using social media and affiliate partners will set the company apart from other stores offering similar products. The founder has excellent Chinese, English and German language skills. This fact is another specific strength of the startup.

Client communication is based on the highest professionalism. Mispurchases will be avoided and trust in the company will grow. The image of [Online Shop Business Plan Sample] STARTUP will have specific dynamics through positive references and mouth-to-mouth, which is then also among its unique features.

This way [Online Shop Business Plan Sample] STARTUP has good prospects of long-term and steady growth, if the company is located in [Online Shop Business Plan Sample] town. The company has all the conditions for an unhindered start in Germany. Many companies would like to do good business in this lucrative market environment, but the aforementioned requirements fulfilled by [Sample Business Plan] STARTUP remain its exclusive USPs.

4. Online Shop Business Plan Sample – Market

As the [Online Shop Business Plan Sample] STARTUP’s business model binds it to various factors, we will outline the general attitudes of German consumers at this point, as well as the online trade situation.

According to the GfK consumer climate index, consumer moods are stable in XXXX. In February and January the overall indicator stood at X, X points. Both economic expectations and the acquisition propensity increased, while income expectations were reduced.

The economic expectations of consumers increased by X, X points to X, X points and remain positive. Consumer expectations are still based on the assumption that the economy is growing, which is reflected in consumption patterns. The good labor market situation is the reason for this rising optimism.

Although there are slight declines in income expectations, the figures remain relatively stable and at a high level as compared to last year. This accounts for the indicator value in addition to the already mentioned rising employment rate, good income growth and very low inflation.

However, the slight decline in income expectations is not reflected in the propensity to buy. Currently, this index value is at XX,X. Consumer sentiment in Germany remains high, which is an extremely positive fact where the market entry of [Online Shop Business Plan Sample] STARTUP is concerned.

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Source: GfK Consumer Research Organization

The German GDP increased by X,X percent in XXXX and expectations for the current year are similar. This is a positive indicator for entry on the German market. Adequate per capita income results in sustained consumption propensity.

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Source: Statistisches Bundesamt

The German buying propensity (“Branch Report online trading XXXX”) is also reflected in online trade according to the latest IFH study in Cologne. Since XXXX this segment has grown by an average of four billion Euro annually. In XXXX the German online market rose to XX.X percent, and in XXXX – to just under XX% to a market value of XX billion. The total online retail revenue compared to other European countries is shown in the following figure. Only the UK has a larger sales volume than Germany.

[DIAGRAM REMOVED]
Source: Survey „Online trade in Europe and the USA XXXX-XXXX“ on deals.com

According to the Hong Kong Trade Development Council (HKTDC) demand for Asian products is as high as ever. For example, the global market for paper, office and stationery (POS) is expected to increase to more than XXX billion Euro by XXXX. And not only classic office and craft supplies can find a ready market. Tablet and Smartphone accessories are among the very popular products on the market. Again, many Kawaii items are part of the product range. All signs in the online trade point to growth. In particular, the progressive proliferation of Smartphones and tablets will continue to drive strong online trade. Overall, market analysis gives a positive image to the plans of KawaiiKu LLC(XXXXX???). In all likelihood customers will come to appreciate the offers very quickly. Over time satisfied, loyal customers will recommend the products and the company will attain more contacts, and their enthusiasm in turn facilitates sustainable growth of a broad customer base.
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5. Online Shop Business Plan Sample – Location

The location of [Online Shop Business Plan Sample] is perfect for any startup. The central location makes it possible to reach all metropolitan cities in Europe in hours. Once the intercontinental airport is ready global connectivity will be even better. Although rent of premises and private homes has risen sharply in recent years, it is still far below the average in other large cities such as Hamburg, Cologne or Munich. Due to the many start-ups in [Online Shop Business Plan Sample] city there are also plenty of affordable funding and coaching offerings, which are sometimes free.

Another important advantage of the [Online Shop Business Plan Sample] location is the network factor. Due to the many networking events and exchanges among young companies, it is possible to quickly find contacts and to expand the field of action. This will be achieved mainly by the planned marketing strategy with the involvement of affiliate partners.

Especially Internet and IT companies in [Online Shop Business Plan Sample] city enjoy rising public interest. For example, Zalando and Soundcloud in [Online Shop Business Plan Sample] city managed a leap into the international business community.

6. Online Shop Business Plan Sample – Competition Survey

Competitors are no major threat in the corporate environment of the [Online Shop Business Plan Sample] STARTUP. While there are about X specialized and thus direct competitors in a similar business model in Germany, these are not a threat mainly due to language barriers.

There are individual competitors who have similar positions on the market, who may very well act as a benchmark. ModesXu (www.modesXu.com) mainly sells Japanese stationery, fabrics, Bento lunch boxes, Re-Ment miniature toys and DIY clay sets and offers free delivery on orders over XX €. The products are imported mainly from Japan and sold worldwide. The site is to be seen as a direct competitor because it is one of the few with a German version.

The UK-based store Tofucute, another benchmark, stands out above all thanks to its modern web design and its good social media presence. Again, it’s not a threat in Germany because the site has only been translated into English.

Most competitors are other English-language online shops which sell Kawaii products, but do not offer a German version of their sites.

It is anticipated that the [Online Shop Business Plan Sample] STARTUP will act very professionally in order to succeed on the market. After a marketing-intensive initial phase, however, the good reputation will be earned after some time, during which the young company will build a steadily growing customer base. In addition, it should be noted that the mere existence of competition indicates the presence of sufficient market potential.

The quality at all levels of business will be so high that the customer will learn to appreciate the offer. Word of mouth will help enhance the commercial success of [Online Shop Business Plan Sample] STARTUP. A clear and professionally developed site and the use of diverse communication channels and local marketing opportunities will be decisive in terms of the numerous benefits to the target group.

For these reasons [Online Shop Business Plan Sample] STARTUP will have an overall good position and be able to handle the competition. The founder has carefully analyzed the market and the performance profile of the company in such a way that it is well-adapted to the needs of the target group.

Competition offer overview
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7. Online Shop Business Plan Sample – Risk Analysis

One must be very cost-conscious and steer an efficient organization to operate with existing reserves. Risks relating to transport, storage risks or disease-related credit risks are minimized by appropriate insurance, or through corporate measures such as a short inventory turnover time. Liquidity is increased through good stock management.

The international setting exposes [Online Shop Business Plan Sample] STARTUP to currency risks. Currently, the Euro exchange rate against the dollar and the Chinese Yuan is still at a level that neither favors nor disadvantages the business model. A strong decline of the Euro, however, would mean that the import business of [Online Shop Business Plan Sample] STARTUP would be affected, and the rise in purchasing costs would be passed on to customers, who then may buy fewer goods or even switch suppliers.
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8. Online Shop Business Plan Sample – Marketing Plan

To ensure effective marketing, core and secondary target groups are first defined. Promotional activities are organized to ensure that the customer needs are met. Marketing measures such as assortment compilation, product information, search engine marketing, keyword use, and display circuits are aimed at these target groups.

8.1 Target Group
There are two main target groups of [Online Shop Business Plan Sample] STARTUP. One is comprised of affluent young professionals with a taste for Asian design, and the other – retailers who wish to introduce additional products in their stores.

A side target group includes young girls between XX-XX years of age, addressed by the planned marketing activities. Although these have relatively low purchasing power due to the lack of income, they do have an affinity for cute accessories and confectionery.

Both target groups use the Internet actively, especially with mobile devices. An important aspect is therefore targeted use of social media activities.

8.2 Marketing Measures for the Defined Target Groups
Customers today look for that special shopping experience – fun and social interaction. Clever e-commerce marketing cannot afford to neglect that factor. Amazon and EBay are the best examples of how customers can be actively involved in the sales process. This existing online tool will also give [Online Shop Business Plan Sample] STARTUP an advantage upon offering Kawaii products here. Online bids will be especially effective, providing a special and exciting shopping experience.

However, not only the eBay Shop will turn more attention to the interaction with clients. In addition to interactive elements on the website, customer requests are processed quickly, comments approved and integrated across all channels and feedback mail sent after purchase. “Call to Action” elements incite customers to take action and make orders.

Another important marketing tool is placing ads on Facebook (so-called Adwords campaigns), as well as good search engine optimization (SEO). SEO provides various advantages. The number of visitors to the site will be enhanced by a better positioning in Google or other search engines. This automatically leads to higher revenue. Since you do not have to pay for each click, this form of online marketing is one of the best. Ad words campaigns guarantee target group placement of advertisements as these are based on user search results.

Corporate identity plays a role to ensure uniformity with the company. The communication of a consistent look helps customers remember the company. All resources invested in internal and external corporate communications help achieve a uniform design.

It is assumed that the resources used will be useful to promote and communicate the product range of [Online Shop Business Plan Sample] STARTUP. Their use will have a positive effect on sales in the long term. If this is not the case, the marketing resources used are to be checked again for their effectiveness.

8.3 Price Strategy
To set the product range apart from that of potential competitors and establish a stable customer base, it is also important to use the price of the services as a marketing tool. By differential pricing with discounts, special agreements or actions, demand is generated and maintained. Of course, these adjustments have to always be oriented to the market and the competitive situation. Intensive research on competitors, target groups and demand can help define a price ceiling. It is most important in any case to cover costs and generate profits in the long term. There is no interest to generate high margins in partnership with Chinese merchants, but instead to generate solid profit for the expansion of business. [Online Shop Business Plan Sample] STARTUP will achieve a modest, but relatively safe profit with larger trading volumes on the import of goods to Germany.

As an initially small niche supplier, [Online Shop Business Plan Sample] STARTUP will rely on direct marketing methods. One part of the product portfolio (Asian design products) will be in the middle to upper price segment, and the other in the lower-price segment (office supplies). A relatively low, but still competitive price will also lead to greater confidence among potential customers and will send a message in itself. Therefore, most of the goods demanded will cost up to XX Euro, while young adults and older clients can operate in the upper price segment, where some goods can even cost over XXX Euro.

A special bidding system will be introduced in the eBay shop to make it more attractive to [Online Shop Business Plan Sample] STARTUP customers. The purpose of this system is to encourage payment in order to optimize the margin. This is achieved by reducing the price until all items are sold.

9. Online Shop Business Plan Sample – The Enterprise

9.1 The Manager
[Online Shop Business Plan Sample] FOUNDER NAME is manager and sole shareholder in [Online Shop Business Plan Sample] STARTUP. [Online Shop Business Plan Sample] FOUNDER NAME has academic skills and professional experience, giving her the right profile to run [Online Shop Business Plan Sample] STARTUP competently.

[Online Shop Business Plan Sample] FOUNDER NAME is a native speaker of Chinese with very good English and German, which will help her on the international market. She’ll manage [Online Shop Business Plan Sample] STARTUP very well thanks to her academic skills and professional experience.

9.2 Legal Form
The establishment in the form of an entrepreneurial company is based on avoidance of private liability and opening an active company with limited resources.

The fact that an EC requires only registered capital of X, XX Euro to XX.XXX, XX Euro and a simple contract and can easily change into an Ltd at a later date provides significant advantages over other legal forms at this time.

In addition, it should be mentioned that to compensate for low base capital an EC must register at least XX% of the annual surplus as reserve funds. Once reserves and capital combined exceed the sum of XX.XXX, XX Euro shareholders may approve a so-called “capital increase resolution”, whereby new possibilities will open up to the company.

The disadvantages of the EC include the notary fees and the costs to draft the shareholders agreement. As a rule, the accounting and expenses for tax consulting services are slightly higher than for joint partnerships.

Finally, an EC offers significant tax benefits. The corporate tax is XX% lower than the income tax, which is levied on partnerships. Hidden reserves can be accumulated because profits are not distributed as in other commercial partnerships.

10. Online Shop Business Plan Sample – Organisation

10.1 Office
A small office with storage space in [Online Shop Business Plan Sample] city will be set up at the end of the tenth fiscal year to process and coordinate orders, deliveries and shipping and to talk to customers personally. X-X PC workstations will be set up there prior to this. Investment costs must be minimized at the beginning, which is why mainly used furniture and appliances will be purchased.

10.2 Accounting
Ongoing activities incurred in connection with bills, taxes and bank statements will be delegated to an accountant monthly. He will also be responsible for preparing VAT returns, payroll tax returns and financial statements.

10.3 Staff
In X. quarter of X. fiscal year an experienced assistant will be hired on a mini-job (marginal employment) basis. In the third year another assistant will be hired part-time and charged with extra marketing, representation and sales tasks.
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11. Online Shop Business Plan Sample – Finance Plan

Capital

The managing sole shareholder [Online Shop Business Plan Sample] FOUNDER NAME contributes registered base capital totaling X.XXX Euro to the enterprise. In addition, her parents will contribute a private startup loan of X.XXX Euro.

This base capital can finance the initial investment and ongoing business operations. The expected positive economic situation in the industry, supporting partners and good payment terms will ensure that the capital in the amount of X.XXX Euro will be enough for a non-problematic market entry. For this reason, no further debt capital will be necessary.

Investments

Investment costs are mainly incurred by the establishment of the office in [Online Shop Business Plan Sample] city and website programming.

Fixed Costs

The fixed costs of the company mainly relate to office rent and staff. Accounting, telephone, travel expenses, cleaning and energy costs also represent a share of the expected fixed costs, since they are all the same or similar amount regardless of the workload.

Variable Costs

Shopping, transportation, packaging and storage costs and costs for taxes, insurance, etc., which vary with the turnover of goods, are linked to the sales figures. To a lesser extent travel, exhibition and marketing costs are also variable costs because they are contingent on the company’s success following initial costs.

Viability

With view to the current economic environment it is expected that no profit will be made until the X. fiscal year. A high increase in sales and profits is expected the following year. To secure liquidity, the founder will not be able to pay herself a salary until quarter X. Until then she will live off her savings.