Business Plans: Top 10 Mistakes To Avoid
Business Planning is one of the key pre-operative steps on which an entrepreneur must invest their time and energy. Business plans are the foundation block to any business, irrespective of the size and industry. Most entrepreneurs do not carry a formal training or functional knowhow on how to draft business plans, the idea is to avoid certain deadly mistakes that can occur during the business planning process.
Mistake #1: Lack of clarity
Most business plans end up generating limited values because they fail to portray an entrepreneurs’ vision effectively to its audiences. What seems like an easy task to explain verbally or in a live interactive presentation becomes extremely difficult to put it on a document for the audience to absorb your idea in an offline mode. Business plans are not just a project document it acts as a communication channel between you and your stake holders. It has to be descriptive as well as to the point, a combination which is difficult to attain.
Mistake #2: Lack of coherency in the structure
Another common mistake that business plans generally tend to have is that the sections in the structure do not sync in together to reflect the same message. This happens if the business planner is not equipped to handle all sections, or not enough time is given to the business planning process. There is a well-defined global methodology used for business planning. It is a structured process just like software development or pharmaceutical product development.
Mistake #3: Generic cookie cutter business plan
The internet is infested with business planning software and templates. AVOID them. Each business plan is unique. It must bring out the uniqueness in your plan. It is very easy to pick up a template and get a business plan done; unfortunately these plans do not make any sense. While there are certain sections which is needed in the business plan, keeping the structure the same for each section needs to be customized for your business. We at BPlanExperts.com have come across several business plans that have been drafted in a generic template way. Our clients have come to us to get such plans redrafted as they have been rejected or failed to attract the right levels of attention. Generic templates simply do not “ cut it”.
Mistake #4: “One size fits all” thinking
Every business plan that you write is for a specific audience. The plans must be customized to ensure you spread out the right message. Frequent revisiting of business plans is important to ensure your plan is updated as you move forward. Business plans are not only used for funding, they are also used to attract collaborators, partners and prospective employees. You cannot have the same plan to be given out to everyone.
Mistake #5: Lack of research to back your business case
You have an idea. Great!!! Do you have enough environmental evidence to back the potential of that idea? Well if you do not substantiate your idea, it will be difficult to convince others about your idea. It is important to get the research done. The research is a preliminary overview of the market and the industry. There is limited value in a very detailed niche market research. A fair enough understanding of the research for your business plan not only substantiates the venture but also shows that you have done your homework.
Mistake #6: No or Generic Strategy
The business plans without a well laid out path to implementation is just a collection of ideas. It is not a plan. Having a generic strategy does not bring in the confidence that you have thought it out clearly. Everyone I know has an idea but only a handful have the implementation angle mapped out. If you have a great idea, try and envision the implementation process. If you can’t nothing stops you from getting professional consulting help from people like bplanexperts.com. We have helped several clients who came to us just with an idea. We consulted them, added on to their idea, got their plan done and also helped them to implement the business. You must have a strategy in place.
Mistake #7: Unrealistic financial projection
Most entrepreneurs think that they will be profitable in a matter of days. Unfortunately, reality is far from this generic notion. Your numbers must have a rationale; your revenues must be substantiated by your strategy and market trends. In the initial phase you must have an in-depth understanding of your available funds, budget and expectations. An unrealistic expectation causes entrepreneurs to give up on the idea either due to lack of proper budgeting or get discouraged by the situation. In your plan it is not a contest to get your numbers as high as possible, rather having a conservative outlook has often turned positive in the long run.
Mistake #8: Not getting professional help
Planning is important, probably the most important phase before you run your operations. If you have figured out the complete business and have the complete knowhow of your project you may get the business plan done up yourself. But being human we all suffer from entrepreneur’s myopia and are biased towards our venture. It is always helpful to have a pair of external eyes to take an overarching look at the plan. In the event that you do not have the adequate knowledge or confidence to approach the business plan, seek professional help. If you avoid investing at the planning stage, you venture may not be stable. Planning builds the foundation to your venture. Business Plan consulting firms like BPlanExperts.com offer affordable and high quality business planning services for entrepreneurs and small businesses. Irrespective of you skill set you must seek professional help to assist you. Do not outsource your work, rather collaborate with business plan consultant. This will enhance your own learning as well.
Mistake #9: Copy paste from sample plans
The last thing you should do is to copy some one else’s business plan or use a sample. You must ensure that you have the right understanding of your business. If your business plan can be copied from some other plan, where is the uniqueness of the idea? If you do not understand certain section it is better to seek professional help rather than trying to play the system by copying from some other source. Planning is not just documenting, it also portrays your understanding and vision to convert your idea into reality.
Mistake #10: Unable to capture audiences interest
Business plans are made a dime a dozen but only a few grab the audience’s attention. Obviously the most important aspect is the idea in itself, but the ability of the business plan to effectively transfer the message can dictate the fate of your business. An excellent idea with a bad business plan will not get the attention it deserves. Good business plans are structured to ensure strong audience engagement.