E-COMMERCE BUSINESS PLAN

A BUSINESS PLAN FOR AN HERBAL SUPPLEMENT E-COMMERCE COMPANY

HERBAL SUPPLEMENT E-COMMERCE COMPANY

By

MOHAMED DAHIR ABDI

June 02, 2015

 TABLE OF CONTENTS
CHAPTER ONE THE E-COMMERCE BUSINESS PLAN ................................................................................ 2
1.1 INTRODUCTION ....................................................................................................................................................... 2
CHAPTER TWO THE COMPANY: AUGMENTATIONALTERNATIVES.COM ........................................ 4
2.1 SET UP COMPANY NAME ...................................................................................................................................... 4
2.2 FINANCIAL HISTORY ............................................................................................................................................. 5
2.3 LOCATION A N D FACILITIES .............................................................................................................................. 6
2.4 LEGAL STATUS AND OWNERSHIP ................................................................................................................... 7
CHAPTER THREE COMPANY VISIONS AND GOALS ................................................................................. 8
3.1 INTRODUCTION ....................................................................................................................................................... 8
3.2 VISION ......................................................................................................................................................................... 8
3.3 GOALS ......................................................................................................................................................................... 8
3.3.1 INTERMEDIATE GOALS: 1-10 YEARS ...................................................................................................................... 9
3.3.2 SHORT TERM GOALS: WITHIN A YEAR .................................................................................................................... 9
CHAPTER FOUR PRODUCTS, COMPETITION, AND PLACE OF PURCHASE ................................... 10
4.1 INTRODUCTION ..................................................................................................................................................... 10
4.2 PRODUCTS ............................................................................................................................................................... 10
4.3 THE COMPETITION ............................................................................................................................................... 11
4.4 PLACE OF PURCHASE .......................................................................................................................................... 11
CHAPTER FIVE MARKET ANALYSIS ............................................................................................................ 12
5.1 INTRODUCTION ..................................................................................................................................................... 12
5.2 INDUSTRY OVERVIEW ........................................................................................................................................ 12
5.3 TARGET MARKET ................................................................................................................................................. 13
5.4 MARKET RISKS ...................................................................................................................................................... 13
CHAPTER SIX MARKETING PLAN ................................................................................................................... 14
6.1 INTRODUCTION ......................................................................................................................................................... 14
6.2 MARKETING RESEARCH ..................................................................................................................................... 14
6.3 MARKETING GOALS AND MESSAGE ............................................................................................................. 14
6.4 MARKETING PROGRAMS ................................................................................................................................... 15
6.4.1 PRICING ................................................................................................................................................................. 15
6.4.2 CUSTOMER SERVICE ............................................................................................................................................ 15
6.4.3 ADVERTISING ........................................................................................................................................................ 16
6.4.4 SALES STRATEGY .................................................................................................................................................. 16
CHAPTER SEVEN MANAGEMENT ................................................................................................................. 17
7.1 INTRODUCTION ..................................................................................................................................................... 17
7.2 MANAGEMENT AND ORGANIZATION ........................................................................................................... 17
7.3 COMPANY PERSONNEL ....................................................................................................................................... 17
7.3.1 COMPENSATION................................................................................................................................................... 17
CHAPTER EIGHT OPERATIONS ...................................................................................................................... 18
8.1 INTRODUCTION ..................................................................................................................................................... 18
8.2 SUPPLY, SALE, SHIPPING.................................................................................................................................... 18
8.3 INVENTORY MANAGEMENT ............................................................................................................................. 20
8.4 RESEARCH AND DEVELOPMENT ..................................................................................................................... 20
8.5 TECHNOLOGY AND COMMUNICATIONS ...................................................................................................... 20
CHAPTER N I N E CONCLUSION ..................................................................................................................... 21
BIBLIOGRAPHY ................................................................................................................................................... 22
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 CHAPTER ONE
THE E-COMMERCE BUSINESS PLAN

1.1 INTRODUCTION
E-commerce is becoming more and more common place in conversations among
Americans today. It seems that everyone with a product is getting in on the "on-line
craze." Even though, lately, the news bombards the public with negative stories of
bankrupt or near bankrupt e-commerce companies, there are some that have become very
l ucrative. One of the most successful types of businesses on the web today is an Herbal
Supplement Company. However, riches cannot be made overnight. There has to be
planning and preparations made before a company can become profitable on the Internet.
A business plan m ust be created just as it would for any other business. To create such a
plan three distinct areas of study should be taken into consideration: 1) Business 2) Natural
Science and 3) Behavioral Science.
Business knowledge is the backbone of any company. A background in business
and business operations is crucial to creating a plan that will be effective on the Internet.
There must be an understanding of what an e-business is. The different legal structures of
business and which is best in a particular circumstance must be understood. An awareness
of start-up costs and financial organization is needed.

Foresight and market knowledge is needed to establish the company's goals and
vision. A general knowledge of how to market and promote a product on the Internet is
needed as well. Management comprehension is the last aspect provided by business and is
used in designing operations and personnel issues. Such skills can be gained in courses
dealing with buyer behavior, marketing, and promotions.

In order to sell a product effectively there m ust be a thorough understanding of the

product. The knowledge of natural science gives one the ability to understand herbal
supplements. There must be an understanding of basic chemistries and anatomy. This will
provide an understanding of what the product will do for the customer and how it does it. This
is imperative to creating a busi ness that will persuade the public to purchase the product.
Such knowledge can be found in courses pertaining to chemistry, physics, and anatomy.

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 The last area of study needed for creating an e-commerce business plan is one in
behavioral sciences. This will be important to detem1ining a target market. It will also be
useful in dealing with personnel issues. Courses such as psychology supply information and
knowledge needed in order to maintain customer satisfaction as well.

Using these three areas of study one can create a successful e-business plan. One such
company that has combined these areas in writing its e-business plan is
AugmentationAltematives.com. The following chapters contain this company's business plan
along with the steps and processes used to create it.

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 CHAPTER TWO
THE COMPANY: AUGMENTATIONALTERNATIVES.COM

2.1 SET UP COMPANY NAME

Before the company could be created several business criteria had to be established. First, the
company needed a name. The name of a company should be straightforward and descriptive.
It should be a similar to the headline of an article, an attention grabber (Covello & Hazelgren,
1994). The purpose of the busi ness and how it plans to distinguish itself from the competition
needs to be established as well. A target market needs to be established. A qualified leader
needs to be picked to head the company. The start-up costs and how they will be met needs to
be established A location for the company needs to be decided. Lastly, the legal structure of
the company needs to be established.
The descriptive name of AugmentationAlternatives.com was decided on for the
company. AugmentationAlternatives.com was formed for the purpose of providing a safe,
affordable, and effective alternative to, and detailed information about the hazardous and
expensive surgical breast augmentation procedure. As a company that operates primarily on
the Internet, AugmentationAtlernatives.com provides the herbal breast enhancement formula,
Fi gure Plus, for sale around the world via its electronic commerce website. Additional
products, such as firming creams and ointments, will be added to the company's product line at
a later date. AugmentationAtlernatives.com decided not only to provide Figure Plus as an
alternative to surgery, but also to distinguish itself from the competition by supplying
information pertaining to the risks and drawbacks that surgery carries. The website contains
up-to-date information taken from the FDA about Breast Augmentation Surgery.
AugmenationAtlematives.com decided to target the adult female population ages 18 to
50, average income of $30,000-$90,000 per year, with an interest in breast enhancement.
Dennis Humble, a young entrepreneur with experience selling herbal supplements and a
background in customer service, was chosen to head the company. He has over a year of
experience dealing with retailing, wholesaling, and promoting herbal supplements. As an
independent distributor for Herbalife International, Denni s Humble gained experience in the
herbal supplement industry. He was responsible for both wholesale and retail sales of herbal
supplements. During the time spent with the company he gained knowledge about the laws
and regulations pertaining to the advertisement and sale of an herbal supplement. He also was
trained to promote effectively herbal supplements to both the public and to potential
distributors.
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 During this time he was able to earn supervisor status in his first month of
employment. He was able to earn world team status by selling 10,000 volume points in his
second month of employment.
He has worked in the customer service field for over eight years in the restaurant and
bar industry. In this industry there is significant customer contact which requires notable
customer service. Eight years’ worth of face to face contact with customers in a restaurant and
bar atmosphere has given Dennis the experience necessary to provide the customer service
required for a business to succeed. During his employment he was granted employee of the
month and trainer status in both the bar staff and wait staff He has also demonstrated excellent
customer service via electronic commerce. He currently has accumulated 93 positive and 0
negative feedback remarks on his E-bay account where he sells Figure Plus. Customers
compliment his kindness and good service regularly.
Dennis Humble currently is completing his Bachelor of Science at Texas Tech
University. He wi11 be obtaining an undergraduate degree of General Studies with an emphasis
in pharmaceutical marketing in December of 2000. The curricul um required for such a
degree wi11 be a great asset for him as leader of this company. This degree requires focus in
business, natural sciences, and behavioral science. . The business area of focus will furnish
the education needed to run a business effectively. Behavioral sciences provide him with the
background to understand and learn about the chemical composition of herbal supplements and
how they react within the body. Behavioral sciences will provide essential skills regarding
management and customer service.
Skills related to web-design, legal services, and accounting will be furnished by contracted
services.

2.2 FINANCIAL HISTORY

Before business could begin at AugmentationAlternatives.com, the company first 1) created a
clean, efficient, persuasive website and 2) acquired needed equipment, software, and services
for automation and record keeping.
AugmentationAlternatives.com was formed with $700 cash and $3000 from Figure
Plus sales generated on E-Bay for start-up costs (Figure 1). A credit line of $7000 will be
provided by a credit card to afford the remaining $3057 of start-up cost, any unforeseen
expenses, and possible equipment or supply purchases. Wells Fargo Bank will provide a
low cost checking account for the busi ness.
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 Figure 1. Start-Up Cost Distribution

Products Office Supplies

6% 12%

Website Office Equip

30% 35%

Merchant
Account
4% Advisors
13%

2.3 LOCATION A N D FACILITIES

Busi ness is operated from the home of Dennis Humble in Lubbock , TX. This
reduces total expenses by more than $1000 per month by reducing overhead and providing
a tax write-off since 90%
of all transactions and services will be done via computer the home office is perfect for the
business . Any business activity that this space cannot accommodate is contracted out to
the lowest bidder.

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 2.4 LEGAL STATUS AND OWNERSHIP
AugmentationAltematives.com is formed as a Limited Liability Company (LLC).
Dennis Humble has l 00% ownership of the company. The LLC was chosen over the
Sole Proprietorship and Corporation entities for the following reasons:
1) Owner is not personally liable for business debts and actions.
2) It is less complicated and more flexible.
3) Income and expenses flow through to the owner and are included on personal income
tax.
4) Does not have double taxation; taxes are not paid on profits.

Source: Small Business Development Center of Lubbock

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 CHAPTER THREE
COMPANY VISIONS AND GOALS

3.1 INTRODUCTION
Now that the company has a basic infrastructure, the next step in the plan is to determine
the company's vision and goals. The vision of the company is a more specific restatement
of the company's purpose. The goals of the company are concrete accomplishments that
the company will attain through the execution of the marketing plan, which will be
discussed in detail in chapter VI. The goals of an e-commerce company should incl ude
the number of hits on the website per day, purchase rate, product revenue, and other
output rated achievements that will define the company's progress.

3.2 VISION
The vision of AugmentationAtlernatives.com is to increase the awareness of the
surgical risks of breast augmentation surgery and to provide an alternative that will
enhance the self-esteem and thus the quality of life for its customers through natural
means. The Company will achieve the vision through the implementation of the following
values:
 Customer's 100% satisfaction
 Empathetic, quality service
 Honesty and integrity
 Continuing education of employees
 Providing the highest quality products

The consummation of this vision will result in AugmentationAltematives.com

becoming the number one choice of women across the cyber-community for herbal breast
enhancement.

3.3 GOALS
The following goals are achievements that define Augmentation Atlematives.com's
future. These goals will provide the roadwork for attaining success and are congruous
with its vision.

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 3.3.1 Intermediate Goals: 1-10 Years
• Increase website traffic to 1000 hits per day
• Increase purchase rate one half of a point to 2%
• Hire a team of live customer service providers
• Increase product revenue to $500,000 per year
• Obtain an advertising market for other herbal supplement companies and feminine needs
providers
• Increase the number of "brick and mortar" retail distributors to 20
• Expand to 3 different international markets
• Become debt free

3.3.2 Short Term Goals: within a year

• Finish the website with complete automation by January 1, 2001

• Add one "back end" product
• Establish a banner ad on 200 related sites
• Become a member of 50 related newsletters
• Have a listing on all major search engines
• Increase website hits to 900 per day
• Have a purchase rate of 1.5%
AugmentationAtlematives.com plans to receive more than 900 website hits per day
by the year 2002. If the sales rate is consistent with the current average of I %, 900 hits
will translate to 9 sales per day (Trepper, 2000). An average purchase of Figure Plus is a
one-month supply which costs $39. This will translate to $130,000 in revenue. Each year
AugmentationAltematives.com intends to increase its yearly revenue by 4% by adding
more products, increasing the number of banner ads by I % per year, improving on the
quality of free information available on the site, and by increasing the reorder rate by 10%
each year.

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 CHAPTER FOUR
PRODUCTS, COMPETITION, AND PLACE OF PURCHASE

4.1 INTRODUCTION
The next step in the e-business plan is to advertise the product to be sold in detail.
The competition's product should be mentioned in this section as well. The ingredients of
the product need to stated and described. The strengths and weaknesses of the product
compared to the competition should be explained in this section. How the product is
packaged for sale will also be mentioned along with possible side effects. A brief
description of additional mediums, other than the Internet, that the product will be sold on
should be mentioned here also. This section is where a strong natural science background
proves imperative. Below is the description of the product, Fi gure Plus, the competition,
and other mediums of purchase.

4.2 PRODUCTS
Figure Plus is a 100% natural herbal supplement that has been proven to enhance
the breasts of women. The active ingredients of Figure Pl us are Ascorbic Acid and
Serenoa repens. Ascorbic Acid is a powerful antioxidant named one of the essential daily
vitamins by the FDA. Its role is to deter the destruction of tissue. It helps to prevent the
breast tissue from breaking down, preventing the breast from sagging and looking old.
Serenoa repens is an herb grown on the south east coast predominantly in Florida. It helps
to increase the net amount of free estrogen in the body without stimulating an actual
increase of estrogen production. It does this by freeing up bound estrogen to be utilized by
the body. This boost of free estrogen recommended that two capsules be taken three times
per day. At this dosage one bottle will last exactly 17 days. Figure Plus is streamlined to
include only ingredients that provide breast enhancement. This allows it to be provided to
the public at the most affordable cost. This is unlike the majority of the competition that
offers "herbal cocktails" containing a myriad of unnecessary herbs that do nothing for
breast enhancement. Figure Pl us has no reactions with any known prescriptions. The side
effects of the product are very slight and are similar to sugar pills. A slight percentage of
women experienced a stomachache and/or headache while taking the product.
Taking the product with food alleviated these problems in some women. Figure
Plus is an herbal supplement and does not produce stand alone results. "Stand alone"
meaning that the product must continue to be taken indefinitely in order to maintain the
results that are acquired.
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This is good for most women, however, because of the Ascorbic Acid content. Figure
Plus is not effective on men or transsexuals, even those currently taking hormone
therapies.

4.3 THE COMPETITION

Similar products within the market include Perfect Woman, All Natural Curves,
Grobust, and Erdic. Perfect Woman and All Natural Curves are a breast enhancement-
combo pack that offers a cream along with an oral product. Grobust and Erdic are oral
tablets. All of these products are offered to the public at 2-5 times the retail price that
Fi gure Plus is. This is because a large amount of production cost goes into purchasing
unnecessary herbs to put in their product. This is referred to as an "herbal cocktail'' above.
None of the websites that these products are being offered on provide or have a link to
free information about breast augmentation surgery. Perfect Woman and All Natural
Curves offer a money back guarantee while Grobust and Erdic do not. Products like
ointments and creams will be sold in conjunction with Figure Pl us in the future.

4.4 PLACE OF PURCHASE

Presently all sales are made over the Internet. This is currently the most feasible avenue
due to the infancy and lack of financing for the company. Two auction listings in the
herbal supplement category of E-bay supply the majority of Figure Pl us sales.
The website that will be complete in January will surpass the auctions shortly
thereafter. In the future, AugmenationAtlernatives.com will be expanding to the "brick
and mortar" sector and to international markets.
Currently Figure Plus is sold in a small locally owned boutique in Lubbock, TX,
Silhouettes. They currently purchase 1 case, or 12 bottles, of Figure Plus a quarter.
Plans are being made to place the product in 20 more retail outlets in the next ten years.
Negotiations are presently in the works for completing an exclusive contract for an
independent distributor of Figure Plus in the nation of Iran. These negotiations will be
complete and the contract will be finalized by January 2001. Two additional international
markets will be pursued within the next ten years.

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 CHAPTER FIVE
MARKET ANALYSIS
5.1 INTRODUCTION
This chapter in the business plan deals with the market analysis. The market
analysis should consist of three different sub-topics. The first sub-topic is the industry
overview. In this section the herbal supplement industry should be described. The
growth rate of the industry should be given here. The business opportunity that herbal
supplements provide and its projected continuation needs to be listed. The next sub- topic
is a detailed description of the target market. Here the demographics of e- company's
customer base should be given. The last sub-topic should deal with the risks of operating
within the herbal supplement industry.

5.2 INDUSTRY OVERVIEW

The Herbal Supplement industry is a large, growing market in the United States
today; in 1998 it pegged out at $10 billion. Only 0.5% of those transactions were made on
the Internet in 1998 (American Demographics, 1998). Internet retailing is growing at an
exponential rate across the world, however (Ernst & Young, 2000). Half of the
consumers online have joined the online shoppers (Trepper, 2000). By the year 2002 33%
of the goods purchased by Americans will be purchased online (Trepper, 2000).
Online purchases are not only increasing in America but worldwide. Countries
like Italy will double their purchases online in two years and countries like the United
Kingdom, Canada, Australia, and France will triple their online purchases in two years
(Trepper, 2000). With the growing number of Internet purchases, the herbal supplement
market is expected to grow exponentially. One of
the reasons for the growth of this already large market is the expansion of new herbal
alternatives and remedies. Herbal Breast Enhancement is among the fastest growing of
all the new natural remedies.
The Herbal Breast Enhancement industry is in its infancy stage. With the first
product emerging less than five years ago, the market is wide open and ready to be taken.
There is yet to be a company or a product to emerge as a leader in this brand new industry.
The products that are available are being sold on three different types of media.
There are advertisements emerging in magazine ads. These ads are placed in magazines
targeted to women. They are often featured on a one half to a full-page ad displaying a
short description of the product and a toll free number to call to order.
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 Ads on television are also emerging in selected areas. Figure Plus is manufactured
in the Houston area by Pharm-Med Inc. Pharm-Med runs a small, low-budget ad on cable
television in this area with limited success. The majority of Herbal Breast Enhancement
advertising and marketing is done on the Internet. The products are offered on retail
websites, which operate on an impulse purchase. All of these sites are owned and
operated by an independent distributor or marketer of the product that they are selling.
There are no known sites that incorporate free information on breast augmentation into
their web page. This will be an advantage and incentive to view Augmentation Alter-
natives.com.

5.3 TARGET MARKET

AugmentationAlternatives.com's target customer will be a female Internet user
between the ages of 18-50 years old. This woman is will be seeking out information
regarding methods to increasing her bust-line. This woman is conscious to the dangers of
surgery and is open to alternatives. This woman is also interested in alternative medicines
and herbal remedies.
The target market of Augmentation Alternatives.com's customer base has a small
amount of discretionary income. They are familiar with the Internet and how to purchase
products on retail websites. They are concerned with their appearance but not willing to
risk the dangers of surgery to improve it.

5.4 MARKET RISKS

AugmentationAlternatives.com runs the risk of being overrun by companies that
already have a foothold in the market. Other companies have been mass marketing and
growing their customer base. The company also could have a problem with the efficacy of
the product. Research shows that the product works on 80% of the women who use it.
This means that potential 20% of all customers who purchase the product will want to use
the 100% money back guarantee.

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 CHAPTER SIX
MARKETING PLAN

6.1 INTRODUCTION
This is the most important chapter in terms of a creating a successful plan. In
this chapter, the marketing research, goals and message, and programs are listed. The
marketing research section should explain what test market was done on the product. It
should tell about the results of the test as well. The marketing goals and message section
state the message that is to be received by the marketing plan. The last section of the
chapter, marketing programs, explains how things like price and advertising will be used.
The company intends to adopt an aggressive marketing plan that will both
increase traffic to the website and promote awareness of alternatives to breast
augmentation surgery. This will be modeled after the highly successful plan of Corey
Rudl. Coery Rudl's marketing plan has proven to be successful by making his e-book,
Car Secrets Revealed a best seller on the Internet.
By modeling this plan, banner ads will be placed on related, high traffic,
websites, and listed on a variety of newsletters and e-zines. The web address will be
placed in numerous Internet Classifieds. Promotions will be run through online providers
like AOL and Hotmail. E-Bay auctions will be used to increase sales and website traffic.
Newsgroups or UseNet will be used as well.

6.2 MARKETING RESEARCH

Test markets were provided through the sale of Figure Plus on E-Bay auctions.
These tests proved the efficacy of the product; there were only 2 refunds provided out of
a customer base of over 300. They also revealed that the product sold best in an
alternative medicine category; the wedding related category sales were next. This
information is will be used in determining advertisement placement.

6.3 MARKETING GOALS AND MESSAGE

The following are the marketing goals for AugmentationAlternatives.com to be
accomplished in the first year of operation.
• Create an awareness of the existence of AugmentationAtlernatives.com and its products
within the female Internet community
• Educate the public of the risks involved with breast augmentation surgery by having the
free FDA pamphlet downloaded off the website by over 1000 people.

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• Make safe, natural, alternatives to the breast augmentation surgery known to women in the
Internet community.
The marketing message will be that there are safe, natural, affordable, and effective
alternatives to breast augmentation surgery. This company plans to be the leader in
providing such high quality alternatives.

6.4 MARKETING PROGRAMS

6.4.1 Pricing
The price of Figure Plus will match the lowest price available at $19.95 for 100
herbal breast enhancement capsules. This price can be offered without sacrificing quality
due to the streamlining of the herbal ingredients in Figure Plus. This price will provide a
57% or $1 1.45 profit from every sale. The profit margin will increase as the cumulative
n umber of bottles purchased increases. After 1000 bottles have been sold the wholesale
purchase price will lower by $1 per bottle increasing the margin to 62% or $12.45 per
bottle.

6.4.2 Customer Service

Because of the profit potential found in retained customers and the competition's
lack of customer service, AugmentationAltematives.com will put great priority in
providing excellent customer service. This will be offered through a toll free customer
service hotline. This hotline will be a place to voice concerns and find answers to
transaction problems. Refunds will be mailed promptly and taken care of with a "no
questions asked" attitude in order to create and maintain a good reputation.
Because of the sensitivity of the breast enhancement issue, customer
confidentiality will be maintained at all times. This includes shipment of the product in
discrete packaging.

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6.4.3 Advertising
Advertising will start with the copy on the website. The copy will be both
persuasive and informative. It will include testimonials from customers who have had
success with Figure Plus in order to develop rapport with our target audience.
Highlights will be placed in bold to bring attention and rei nforce what the product
will do for the customer. The length will be as short as possible to prevent the potential
customer from losing interest. The information will be clear, concise, effective, and
most importantly, error free. The overall message will be to provide a solution to
achieving breast enhancement without the dangers or cost.
Banners will be posted on high traffic websites that are of interest to the
company's target market. Banners will be designed by Dennis Humble following the
Corey Rudi model, which has been proven to have a 5% click through rate. E-zines and
newsletters will be used to reach the target market instead of the traditional method of
bulk e-mail. Bulk e-mail will be avoided as it is looked upon negatively and will harm
the company's reputation. Internet Classifieds will be used as an affordable means of
reaching large numbers of Internet users. These will be placed on strategic locations
where the target market will traffic. Promotions will be placed on the shells of AOL and
MSN's mail server Hotmail. Such advertisements have a high viewing rate and provide a
direct link to AugmentationAiterntives.com. This again is an effective alternative to the
m uch disliked bulk mail.

6.4.4 Sales Strategy

The sale of all products through AugmentationAlternatives.com wil1 be done
with the customer in mind first. The company will be empathetic to all the needs of the
customer. This incl udes needs that wi11 not necessarily result in short term profit for the
company. The attitude of '"service first will equal profits later" will be dominant in all
employees.

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 CHAPTER SEVEN
MANAGEMENT

7.1 INTRODUCTION
The management chapter of an e-commerce business plan is short. This is due
to the small amount of personnel. More often than not one person can operate a small,
l ucrative e-commerce company. This chapter should include the company personnel and
its projected expansion. It should also contai n the compensation plan of the personnel.

7.2 MANAGEMENT AND ORGANIZATION

The company personnel will consist of the head of the company, who will be
responsible for all company functions. These include administrative tasks like answering
the phone, responding to e-mail, re-listing auctions, filling and shipping orders, and
record keeping, along with e-Marketing functions, such as link research, banner,
newsletter, and e-zine listing, search engine submission, and webmaster.

7.3 COMPANY PERSONNEL

To start there will be only one employee of AugmentationAlternatives.com. This
person will operate all functions of the business with no salary until all short-term goals
have been met. After the short-term goals have been met, the services of a fulfillment
house will be sought. It will be used to take incoming orders from both the telephone and
the website and to ship the product to the customer.
In the long-run a customer service panel of 5 part-time telemarketers will be
hired within the first five years of operation. This panel will be used to take incoming
telephone orders and deal with customer service issues that will arise.

7.3.1 Compensation
There will be no salary given until all short-term goals are met. All profits
will be used to achieve the short-term goals listed in Chapter three.
The fulfillment house will be paid on a commission basis. They will receive a
5% commission for all orders processed through the telephone. They will be paid a
flat fee of $3 per bottle that is shopped from website orders. This is the
commensurate compensation for such services in the continental US.
Telemarketing personnel salaries will depend on the previous experience of
the candidate.

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 CHAPTER EIGHT
OPERATIONS

8.1 INTRODUCTION
The operations portion of the business plan is the last to be discussed. In this
chapter every detail of operation, from the purchase of the product from the manufacture
to the shipment of the product to the customer is mapped out. This section demonstrates a
clear, efficient, and logical method to completing a transaction.
At AugmentationAtlematives.com a customer will purchase the product at one of
two locations, 1) the website or 2) an E-Bay auction. The current product to be sold,
Figure Plus, will be purchased and supplied directly from the manufacture Pharm-Med
Inc. based in Houston Texas. Products added in the future will be supplied by a reliable
manufacture offering the highest quality product at the lowest price. All products will be
purchased by an American Express Blue card, which will be paid in full every month.
The customer will pay for the product by money order, check, or credit card. All
orders will be shipped within 48 hours of payment. Money Orders and checks will be
received by mail. Credit card orders will be fulfilled by either a secure online transaction
or by a PayPal transfer. All products will come with a 120-day money back guarantee. A
full refund, minus shipping and handling, will be given to any customer who is not
satisfied with the results produced after 120 days of use. This guarantee has been
implemented to counteract the time it takes for results to be seen.

8.2 SUPPLY, SALE, SHIPPING

Figure Plus will be supplied by its manufacture Parm-Med Inc. An inventory
of 100 bottles will be kept on hand at all times to meet the requirements of e-bay
auctioning. Once ful fillment service is added the inventory will increase.
A potential customer will be exposed to the products on either an auction or
the website. If a customer visits the auction, she will read the advertisement then,
either visit the FAQ page of the website or write an email to the company with her
questions. All frequently asked questions are outlined on a page of the website. If the
FAQ page satisfies the customers' inquiries then they will be given the option to
purchase the product there. If the customer is not satisfied with this page she is urged
to write the company through a link for e-mail composition or to call the toll free
n umber to the office for further assistance.
An employee will assist the customer by writing a custom response to the
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electronic mail or by personal conversation over the phone. If the customer has
called the office then a close will be made on the sale once the question has been
answered. If the customer has made contact via electronic mail then she will return to
the auction to place a bid or to the website for the purchase through a link provided in
the signature of the e-mail response. The website will contain a secure order form for
an instant credit card purchase.
This order form will be used for all orders placed through the website and over the
phone. For auction orders the transaction will take up to eleven days to complete. On
the auction the customer is given the option to bid on a quantity of bottles less than
one hundred. After the auction ends, an end-auction email is automatically sent to the
customer explaining the amount owed and payment protocol.
After a payment is received by one of the two transaction types, the customer is
notified and the shipping process begins. Orders of six bottles or less wi11 be packaged in
a large video priority-mail box. Orders lager than this will be packaged in a plain brown
box to with a size to accommodate the order. The priority mail box has been chosen for
its size and discreteness. This box holds up to a three-month supply of product. The
outside of the box does not indicate in any way the contents of the box.
All orders will be packaged with an instruction letter and a brochure. The instruction
letter congratulates the customer on their purchase, explains, in detail, how the product
should be taken, and gives instruction on how to reorder. The brochure provides more
information about the product and serves as an advertisement for referrals.
The priority mail postage will be purchased via stamp.com. Stamps.com provides
a service that allows postage to be printed by a personal computer printer and keeps a
database of customers and their addresses. All postage purchases will be debited directly
from the business bank account.
The final packaged product will be left on the front porch to be picked up by the
USPS mail-person on the following day. All products will arrive at the customer's home
no more than four business days from the day payment was received.
Customers’ wi11 be notified automatically via e-mail by an auto responder \when it
is time for them to reorder. This email will contain a link to the order form on the website
and promotional material on a back-end product.

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 Customers who are not satisfied with the product will call the toll free number or
write an e-mail to the company. The unsatisfied customer will promptly be sent a refund
check via priority mail.

8.3 INVENTORY MANAGEMENT

The company will maintain an inventory of 100 bottles of Fi gure Plus. The
auction advertisement ran for Figure Plus states that there are 100 bottles for sale. E- Bay
policy states that all the items listed in the auction m ust be on hand at the time that the
auction is ran. The Inventory will increase with the addition of fulfillment house services
to match the increasing demand.

8.4 RESEARCH AND DEVELOPMENT

The Company will continuously be adding new and improved products to it
website in order to maintain the best of reputations. These will be found in herbal remedy
and women's magazines, FDA publications, and women related websites.

8.5 TECHNOLOGY AND COMMUNICATIONS

AugmentationAltematives.com will operate with state-of-the-art computer
systems and hosting services. In the beginning the Company will operate from an IBM
compatible personal computer with a 500 MHz processor chip, 56kps modem, 64 mg
RAM, and 10 GB of hard drive space. The computer will be used to access email, update
the website, list auctions, and conduct market research. All bookkeeping and inventory
records will be kept on the computer hard drive and backed up on floppy disk until a zip
drive is added to the hardware. Because of the rapidly expanding technology a computer
upgrade will be required every two years. Interland will be used as the hosting service
and Internet service provider. They offer an affordable hosting package complete with e-
mail service and autoresponders. They also provide a search engine submission service
with a money back guarantee.

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 CHAPTER N I N E
CONCLUSION

As e-commerce grows, the herbal supplement industry will surely grow with it.
Companies need to create and develop a plan that will give them the organization
needed to keep up with the growing Internet. AugmentationAtlematives.com has
developed an e-business plan utilizing three distinct areas of study that will prove to
be successful. Business was used to define the business itself, create a marketing plan
that will target a specific market, and implementing management and operations.
Natural sciences were integrated in order to describe and understand the herbal
supplement being sold. Behavioral sciences were used to cater to the target market,
develop a company vision, and deal with personnel issues. A company that follows
the plan of AugmentationAltematives.com and implements the use of these three
schools of thought in creating their business plan will have a map to success.

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