How many customers projected for firts year of business?
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This section of the forum is for discussing the business and finance issues of the t-shirt industry. Which business structure to use (sole proprietor, LLC, S Corp, etc), how to handle billing, where to register your business and get the proper licensing, etc.
How many customers projected for firts year of business?
How many customers projected for firts year of business?
Hello,
I know the question of sales forecasting has been asked a thousand different ways. Although I recognize the hesitance to answer specifics about sales revenue; my question is a little different. I am enrolled in a program whereby the end product is expected to be a comprehensive business plan for an on-line T Shirt business. Notice, I said "expected to be" .
Without certain information, I will never get out of this program. The instructor is insisting that I project the number of customers & repeat customers for the 1st two years. I have been able to provide "industry" statistics and have explained that most T Shirt businesses are hesitant to share revenues information. I agree with Lucy@ T-Bot in a 2006 post re to aiming towards 100K+ annually: that seems to be the only way to etch out a living. Although my 2-3 yr forecast aims at that - without further support (hopefully from this forum) the instructor will refuse to accept that as reasonable. The resolution is that, I do not have to prove my revenue projections if I can gather supportive information re number of customers the average site has. I hope this information does not seem intrusive, I mean no disrespect. Bear in mind, I am not asking how you get your customers just an understanding of how many an average T Shirt shop has.
Thanks for any help offered
Re: How many customers projected for firts year of business?
Seems to me it shouldn't be based on how many customers you may have but the dollar revenue. If you have only one customer that spends $100,000 the first year wouldn't that be enough?
Re: How many customers projected for firts year of business?
Quote:
Originally Posted by lizziemaxine
Seems to me it shouldn't be based on how many customers you may have but the dollar revenue. If you have only one customer that spends $100,000 the first year wouldn't that be enough?
Thanks for responding and YES, one customer spending $100,000 would be great.
But I think the the reality is, that my business will be built on transactions totaling $25. or less. With that being said: if I had a better understanding of how many customers I could expect then I could base my sales forecasting on that data.
Re: How many customers projected for firts year of business?
I don't know if this will help you much, but if you want $100,000 in revenue from orders of $25, that would mean you'd need 4,000 orders. If you wanted to reach this revenue target in 1 year, that would require approximately 11 orders every single day.
Have you ever looked at the website Compete.com? You can get information on statistics of competitors' websites. The site shows that Cafepress and Zazzle.com get between 2 and 4 million unique visitors per month; CustomInk.com and Spreadshirt.com draw about 400,000 unique visitors a month. But you probably wouldn't get that traffic starting out with a new website. Sites like Bluecotton.com, Shirtmagic.com, and SonicShack.com look like they get about 10,000 to 15,000 unique visits per month. If the average conversion rate is 2-3% (you may want to verify this rate somewhere), then you could possibly infer that you could get 200 to 450 orders per month (assuming you have the capacity to handle that kind of volume). That means in an entire year you would get 2,400 to 5,400 orders. At $25 per order, that's a range of $60,000 to $135,000 in annual revenue. You'd have to process 7 to 15 small orders every single day or 46 to 104 orders per week. It might be better to try to get larger orders than $25 and have fewer orders to deal with at a time.
Who knows how accurate this is, but that's an example of the kind of thinking you can use to estimate when you don't have access to private company data.
Re: How many customers projected for firts year of business?
Quote:
Originally Posted by clevermoon
Hello,
I know the question of sales forecasting has been asked a thousand different ways. Although I recognize the hesitance to answer specifics about sales revenue; my question is a little different. I am enrolled in a program whereby the end product is expected to be a comprehensive business plan for an on-line T Shirt business. Notice, I said "expected to be" .
Without certain information, I will never get out of this program. The instructor is insisting that I project the number of customers & repeat customers for the 1st two years. I have been able to provide "industry" statistics and have explained that most T Shirt businesses are hesitant to share revenues information. I agree with Lucy@ T-Bot in a 2006 post re to aiming towards 100K+ annually: that seems to be the only way to etch out a living. Although my 2-3 yr forecast aims at that - without further support (hopefully from this forum) the instructor will refuse to accept that as reasonable. The resolution is that, I do not have to prove my revenue projections if I can gather supportive information re number of customers the average site has. I hope this information does not seem intrusive, I mean no disrespect. Bear in mind, I am not asking how you get your customers just an understanding of how many an average T Shirt shop has.
Thanks for any help offered
Thank you ... a thousand times thank you for your kind and generous response. I was unaware of that website and will visit it ASAP.
Re: How many customers projected for firts year of business?
It is all about the traffic you can generate to your website. By any means necessary!!!!!! A small percentage of the population is still a LOT of potential customers. People can't buy your stuff if they don't know about it.
Re: How many customers projected for firts year of business?
Quote:
Originally Posted by gearbranders
I don't know if this will help you much, but if you want $100,000 in revenue from orders of $25, that would mean you'd need 4,000 orders. If you wanted to reach this revenue target in 1 year, that would require approximately 11 orders every single day.
Have you ever looked at the website Compete.com? You can get information on statistics of competitors' websites. The site shows that Cafepress and Zazzle.com get between 2 and 4 million unique visitors per month; CustomInk.com and Spreadshirt.com draw about 400,000 unique visitors a month. But you probably wouldn't get that traffic starting out with a new website. Sites like Bluecotton.com, Shirtmagic.com, and SonicShack.com look like they get about 10,000 to 15,000 unique visits per month. If the average conversion rate is 2-3% (you may want to verify this rate somewhere), then you could possibly infer that you could get 200 to 450 orders per month (assuming you have the capacity to handle that kind of volume). That means in an entire year you would get 2,400 to 5,400 orders. At $25 per order, that's a range of $60,000 to $135,000 in annual revenue. You'd have to process 7 to 15 small orders every single day or 46 to 104 orders per week. It might be better to try to get larger orders than $25 and have fewer orders to deal with at a time.
Who knows how accurate this is, but that's an example of the kind of thinking you can use to estimate when you don't have access to private company data.
Awesome! Although I think the average of $25/order is probably too low. But I could be, and probably am, wrong.
How many customers projected for firts year of business? 
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