eCommerce Business Plan Example for Startups in Nigeria
This is a business plan sample of an e-Commerce Business startup.
All names and business details in this post are fictitious and are used only for illustration purposes.
If you intend to start an eCommerce business in Nigeria, then this business plan will come in handy.
You could modify some of the details in this business plan to fit the features of your eCommerce startup business.
Let's get right into it.
Executive Summary
Pankymobile is an eCommerce website that sells mobile phones and accessories to customers in Nigeria.
We utilize our website, mobile app, and social media pages to target and reach mobile phone customers with the latest mobile phone brands and accompanying accessories.
Our target customers are those who want quick access to the latest brand releases at the best possible prices.
We expect to reach 50 million potential customers annually and sell at least 1 million products right from our website and social media pages.
Business Description
Pankymobile is revolutionizing the way users access the latest mobile products in Nigeria.
We are helping savvy young people find the phone brands and accessories that best fit their lifestyle.
Through our website and social media page, we offer seamless access to the latest mobile devices money can buy.
We deliver quickly in all states in Nigeria, with our guaranteed 48-hour delivery times for items less than 100kg.
Our pickup locations are available in choice locations around the country, which gives savvy affiliate marketers the chance to drop ship mobile products via our website and make money.
Business Model
Our business model is quite simple. We help curate the latest mobile phone devices and accessories, so customers can quickly find and purchase them.
Through our website, we provide speed of access, purchase, and delivery. If a customer sees a mobile product and wants it, they can pay for it instantly and get their purchase in record time.
Our website is closely integrated with our social media pages, which helps users share new mobile products they find with their family and friends.
We have partnered with over 10,000 delivery centers and drop shippers across the country, acting as sales agents and influencers to drive more product sales.
Product Pricing
Our products vary depending on the mobile phone brand or phone accessory.
However, the average price of a mobile phone sold via our website is 80,000 Naira, while the average price of a mobile phone accessory is 20,000 Naira.
The cost of delivery charged on every parcel is a flat rate of 1,000 Naira per kg.
Industry Background
The eCommerce industry in Nigeria is very promising, with opportunities to integrate and bring many sectors of the economy online.
According to MordorIntelligence, Nigeria's eCommerce industry in 2024 is valued at $8.53 billion, and expected to grow at an impressive rate of 11.82% to reach $14.92 billion by 2029.
With eCommerce encompassing many sectors of the economy with a variety of products, Statista shows that in recent years, the electronics category has been the most valuable, with consumer spending reaching $2.4 billion in that sector alone.
Competitive Analysis
We have a few competitors in the ecommerce space who have managed to build a strong reputation over the years.
The biggest eCommerce website in Nigeria is Kunda, which is attributed as the Amazon of Nigeria.
They have a well-rounded catalog of products in different categories, and have an average fulfillment service.
The second major competitor is Amanga, which is hyper focused on household goods.
They have a strong and loyal customer base which they've managed to build via organizing interesting household shows with raffle draws.
There are other minor eCommerce websites in Nigeria, with some focusing on serving different states and locations of the country.
Other minor players are individuals selling directly via social media platforms with no branding whatsoever.
Competitor SWOT
Strengths
The biggest competitors in the industry enjoy a first-mover advantage, with a host of affiliates recommending their products.
They also have strong partnerships with merchants across the country, which ensures that they always have the latest products listed in different categories on their website.
Weaknesses
They have so many product categories selling different products, which makes specific product discovery difficult via their websites.
Other websites are mostly players in categories we are not interested in, while individual social media sellers have no strong branding to encourage repeat customers.
Opportunities
They could do better in terms of delivery, which might not pose a problem at the moment, but could become a big issue as the market matures.
There are still big opportunities to integrate physical shops onto their websites and online platforms, in order to have quicker access to the most demanded products.
Threat
Niche eCommerce websites are springing up as quickly as possible, and they have a very strong proposition to serve their verticals better than these big players.
We are excited to be in this group, as we believe that the eCommerce business should be niched down.
Customers have also shown to be more responsive when they purchase from website platforms offering products in one or a few related categories.
Market Analysis
Target Market
Pankymobile is targeting young Nigerian working class mobile phone enthusiasts who are looking for the latest mobile phones and accessories.
This target market has shown to be buoyant and willing to periodically upgrade their mobile phones and accessories.
Expected Annual Customers
We expect to sell to at least 1 million customers annually via our website and online platforms.
Marketing Plan
Our marketing plan involves using social media lead campaigns, organizing social media incentivized quizzes, and holding road shows.
The first plan is to sell our brand name to customers, and then prove that we can be the go-to platform to get the latest phone gadgets in Nigeria.
We are looking to partner with a handful of tech and mobile blogs in Nigeria who already have an audience interested in purchasing mobile gadgets.
Our plan is to partner with this influencers to post and recommend our products to their users and also use their platforms to engage customers.
SWOT Analysis
Strengths
We have the potential to be the go-to platform for young Nigerian mobile phone enthusiasts.
Our platform and brand is designed to be niched and youth friendly, so much that when you think of mobile phones in Nigeria, you think Pankymobile.
Weaknesses
We are quite new to the market, so we currently do not have any share in the minds of customers.
Also, being niched means that we are limited in the number of products we can sell, but we also think that it could be an advantage.
Opportunities
We see an opportunity to focus on the mobile phone category, which is a subsect of the electronics section, and is touted as the most valuable part of the eCommerce sector in Nigeria.
We've also noticed the chance to sell on social media via different methods such as affiliate marketing, direct ads, and social games to grow our brand online.
If we are able to tie our brand with influencer platforms, then we could leverage social media to find new loyal customers.
Threat
The big brands have higher spending power and already have existing relationships with the top mobile phone brands.
This means that they could enjoy exclusive deals where they are the first to get access to new mobile phone releases on their platform before anyone else.
The Team
Our team comprises Adega, Mark Bullan, and Steve O.M.
Adega is the CEO, who has founded and exited a few startups such as the popular Xendi marketplace.
Mark Bullan is the CTO, who leads the tech team for all our platforms.
Steve O.M is our business development and sales lead, who is responsible for managing partnerships and marketing.
Financial Plan & Forecasts
Expected Annual Revenue
We expect to sell at least 1 million products per year, with mobile phones making 55% of that number, and phone accessories making 45%.
We also expect to make 200 million Naira from delivery alone, by delivering 1 million products weighing at least 200g.
With the average price of a mobile phone being 80,000 Naira, we expect to make 44 billion Naira from mobile phones.
Phone accessories are expected to generate 9 billion Naira, with the average item sold for 20,000 Naira.
In total, we expect to make 53.2 billion Naira in annual revenue.
Production & Distribution Costs
Our annual production and distribution costs includes:
- Business development - 400,000,000
- Products Logistics - 3,000,000,000
- Wages - 300,000,000
- Vehicle Maintenance - 5,000,000
- Rent - 10,000,000
- Internet & Electricity - 4,000,000
- Digital Marketing - 1,500,000,000
- Utilities - 5,000,000
- Total Costs - 5,224,000,000 Naira
Profit Margin
Our profit margin is Expected revenue - Total costs / Expected revenue X 100.
(53,200,000,000 - 5,224,000,000) / 53,200,000,000 X 100 = 90.18%
Our expected profit margin is 90.2%
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