If your plan doesn’t stress test the system, it’s not a real plan.

Most e-commerce financial planning is backward-looking or overly optimistic. It shows what might happen — not what needs to happen to stay alive, stay profitable, or scale safely.

At Modonix, we don’t build “nice-to-have” projections. We build financial hypotheses:

  •  What happens if ROAS drops below breakeven?
  • What if ad spend stays the same but CAC goes up 20%?
  • What if our top SKU runs out mid-Q4?

 

This kind of modeling isn’t optional — it’s survival.

Here are 3 scenarios every serious e-commerce operator should build — and why they work as a management alert system.

1. Contribution Margin Pressure Scenario

Hypothesis: What if our contribution margin drops by 10% — can we still operate profitably?

⚠️ This tests: unit economics, variable cost creep, discount strategy pressure.

Inputs to simulate:

  • Higher ad costs (lower ROAS)
  • Temporary COGS increase (supplier, freight, duties)
  • Heavier discounts (clearance, promotions, retargeting)

What this reveals:

  • Your true breakeven ROAS
  • How fast your business starts burning cash
  • What SKUs or channels fall below margin targets first

💡 Use this to set guardrails: If contribution margin hits X%, we freeze discounting + cut spend on SKUs below Y margin.

2. Cash Trap Scenario (Growth Without Capital)

Hypothesis: What if sales accelerate but cash flow breaks?

⚠️ This tests: working capital limits, payment terms, inventory cycle pressure.

Inputs to simulate:

  • 30–40% sales growth (on paper)
  • No change in payment terms (vendors still want 50% upfront)
  • 45–60 day cash conversion cycle
  • Inventory buy + ad spend needed to fulfill future demand

What this reveals:

  • Breakpoints where your cash position flips negative
  • How much capital you need just to survive a “good month”
  • Where vendor or fulfillment terms become a bottleneck

💡 Use this to plan for:

  • Pre-negotiated vendor terms
  • Revolvers or lines of credit
  • Staggered inventory buys by SKU priority

3. Fixed Overhead + Ad Efficiency Breakdown

Hypothesis: What happens if paid ads stop working for 30 days?

⚠️ This tests: dependence on acquisition, brand strength, burn rate vs reserves.

Inputs:

  • Cut paid media spend by 70–100%
  • Maintain fixed costs (payroll, warehouse, SaaS stack)
  • Model repeat customer rate only (existing base)

What this reveals:

  • Your monthly burn without acquisition
  • How long your reserves last
  • Which costs become urgent to renegotiate or pause

💡 This is the “crisis simulation” model: Keep it handy. Run it quarterly. It will keep your leadership team honest.

Why These Models Matter

These aren’t “best vs worst case.” They’re live hypotheses that help you make faster, data-backed decisions — before you hit a wall.

Scenario | What It Guards Against
——–|————————
Margin Pressure | Sloppy discounting, ad inefficiency
Cash Trap | Growth without capital readiness
Ad Freeze | Channel overdependence, high fixed costs

Final Thought

You don’t build a financial model to “feel good.” You build it to know where the floor is — and what to do when you’re about to hit it.

At Modonix, we help e-commerce founders build systems that work like pressure gauges — not crystal balls.

👉 Want a real model with alerts, breakpoints, and what-if toggles? Contact us and we’ll build you one that actually tells you what to do — not just what might happen.