Business Analysis

To sell products via internet it is imperative to have an ecommerce website with an easy interface and solid technical features. But building an ecommerce website is not the only mantra to succeed online.

To have a successful online business, a perfect online business system is required, and to create successful online business system one has to analyze the current situation of his offline business, set achievable goal and strategy, organize for the online presence (take action control and form resources)

Why conduct Business Analysis? To understand the current situation/status about your business.

Business Analysis boils down to two categories - Internal (within your organization) and External (outside your organization).






Internal analysis: Within your organization.

What is your current offline business model? Retailer or Wholesaler or Manufacturer or an Agent...

What products you sell offline? Tangible or Non-Tangible...

What are the key performance indicators that will identify Online business’s success (This purely depends upon your business model and online business objective – Where you want to be and what you want to achieve)


Sales Conversion – Online product purchase
Enquiries - That lead to offline purchase
Cost per visitor
Average order value
Average order size
Toll-free number calling
Awards – Win high profile award for any of the business functions like customer care
Costs – Lessening the cost of particular business function
Reach (New Visitors) – Reaching untouched customers. Are they qualified?
New vs Returning – How are the behavior of new and returning visitors? Who purchased online? Etc, etc…

There could be many other KPIs that will define your business’s success. Remember KPI must reflect with the business goals. It has to be measurable and quantifiable.

"Now comes SWOT analysis"

SWOT - Strength, Weaknesses, Opportunities, Threats.

What are your Internal – Strengths and weakness?
Strengths are could be your specialist expertise; Weaknesses could be lack of particular expertise

Strengths could be….
Unique product/services (with extra benefits/features – USP)
Good offline reputation
Large clean and qualified customer database
Distribution Channel

Weaknesses could be…
No technical team to assist
Financially not very sound
Lack of ecommerce market knowledge

The above mentioned are just imaginary Strengths and Weaknesses.

External analysis: Outside your organization.

Target market analysis:
Who are your competitors?
Are they buying products online? If not, why not?
How are customer influenced to buy online?
Is there a demand for your product? (Demand Analysis) How to conduct online demand analysis?
Understanding online buying behavior?

What are external – Opportunities and Threats
Opportunities are external factors that could help organization to trap the market.
Threats are changes in the environmental factors that could trash the business.

Opportunities:
Customer buying preferences
Not too much of competition

Threats:
Rapid change in technology
Two competitors are online

Resource analysis (Manpower):
The most important thing you need to have is 3M – Men, Money, and Minute.

Men/Women – Required expertise to do handle different jobs. (You have to decide in-house or outsource)

Money – Required budget to appear online

Minute – Time scale/schedule to appear online. Put a Gantt chart. Have specific time schedule for each task. Example: Appear Online within 3months. You must have a good project management system or track it in simple excel sheet.

If you don’t have required resources how will you appear online?
In-house or Out-source

Technical Analysis

What technology do I need to go online?
Here you have to examine what software, hardware and other technological functions that are needed to run and manage online business?
Do you have a good internet connection?
Do you have software to build website?
Do you have required hardware components to run your business smoothly like printer, scanner, etc?
Do you have technical staff to support you? (See resource analysis)
Who will be your hosting and domain management company?
Which software to use to conduct eCommerce transaction?
Do you have a content management system for frequent site update?
Do you have email marketing software and other software to run business effectively?
Do you have an inventory management system? (Examine if you really need an inventory management system), etc…
How much it will cost you? (This should reflect in resource analysis)




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