One of the first few crucial steps to getting your start up off the ground is writing a business plan. A good plan can help you raise money, recruit members of your management team, set your marketing strategy and to top it all, refine your thinking. But what if a plan is riddled with errors? That is likely to sink you.
Hence, it helps to be aware of 10 common mistakes entrepreneurs frequently make while writing their business plans.
Being All Things to All People
Do not spread yourself too thin. All business plan ideas cannot appeal to every possible audience. Have this as the bottom line. Try and pick one business model suitable to you and focus on one industry or one problem. Otherwise, you will end up creating a plan that is bound to make a bad impression the very first time.
That’s the last thing you want to be. In case a potential client reads up two pages of your plan and is bored, then it’s a bad sign. It’s important to keep the reader interested right from the very beginning where the executive summary is given, to the very last page. Also, don’t forget the cover page: a well-designed logo never hurts.
Don’t be over optimistic while measuring the market
It will appear impressive if you project vast markets and the potential for huge sums of revenue. Outsize financial estimates may seem impressive, but the investors find them to be gimmicky. Worse still, big numbers often make you sound as if you don’t know what you’re doing or how hard it will be to penetrate your target market. Don’t make big promises unless you’re absolutely sure you can keep them.
Lacking the Confidence to Sell Your Product
In an effort to appear confident, most of the businesses tend to overlook the competition that they are bound to face when they start. However, this betrays a lack of sophistication. Very few ideas zero competition. Even if your concept is completely original, you should take into account forces that compete with your product or service, including different solutions to a problem, different ways that customers might choose to spend their money, and inertia in the marketplace.
Repeating Yourself Too Much
Avoid repeating a few catchphrases and a few simple ideas in 10 different methods. Nobody wants to hear the same thing over and over again. Be sure to keep your plan’s fundamental message consistent throughout, but employ creative language and appealing imagery to flesh out your ideas.
Using Too Much Jargon
Remember that not everyone in business is familiar with cross-industry lingo. If you have a background in a specific industry, this is especially true in science and engineering, try to use simple, specific, and concrete phrases to describe your business. Rely on general terms that everybody can and will understand.
Not Being Consistent
Eliminate contradictions. Make sure that the information in your plan is consistent. For example, a financial chart deep within the plan does not undermine a fact used in an earlier section. Be absolutely certain that every fact about your industry, the market, and key competitors is accurate and readily verifiable.
Failing to Incorporate Feedback
Once you complete your business plan, try and get feedback. Going ahead with business plan ideas without following this step is a mistake that an amateur is likely to make.
Remember: Presenting to a top investor a draft business plan that contains silly errors or gaps in logic is worse than presenting no plan at all. Try reaching out to a few friendly contacts who have vetted business planning in the past before you begin to share it with qualified potential investors.
Taking Too Many Perspectives Into Account
Do not go overboard in anticipating lines of questioning or identifying possible flaws in your thinking, that a reader will have a hard time following the narrative thread. Make sure you address some likely investor objections, but balance the desire to be clear-eyed with the overall objective, which is to make a persuasive pitch.
Failing to Acknowledge the Competition
Successful plans come in all shapes and sizes and formats. So, don’t worry about crafting one that looks and reads exactly like every other plan that’s out there. Your goal isn’t to fit in. You want your business plan to stand out. If you create a proposal that expresses your idea and your personality, you will be more comfortable and confident when you are called on to present it. Some business planning can go a long way in ensuring long-term success.
To begin with never mind the mistakes in business planning. Learn from your past, make timely rectifications and make the necessary changes in the whole business idea. All that matters in the long run is your business success.