Business plan is a good place to start when we are planning to have new business ventures. Writing business plan can start by reading a proper book on the subject. This allows us to create our written report properly and we won’t fail to include critical components. However, there are some mistakes that we need to avoid:
- We don’t assign time: Writing a good business plan can be a real chose and it is to procrastinate, especially if we need to focus on core process of our business. Many new business owners wait until the day before the scheduled meeting with investors, lenders and banks. It is a bad idea to write our plan frantically overnight. We could imagine the result and it would be disappointing. When writing a business plan, we actually need to clear our calendar for the whole week and make our planning a priority. Like what many others have said, if we fail to plan, we are planning to fail.
- We correlate success directly with profit: Unless we have a good background in accounting, it is quite likely that we define success directly with profits. Calculating profit is very easy, revenue minus expenses equals profit. However, real businesspeople know that profit don’t equate with success. The accounting system is actually much more complex than that. We should also need to include the amount of money tied up in the production process and inventory that hasn’t been sold. It is also important to consider that our assets will depreciate and this factor must be added to the expenses category.
- We oversell our ideas: Many business owners enthusiastically blabber on for multiple pages about the uniqueness and newness of their ideas. In reality, lenders, banks and investors want to focus on the business feasibility, not ideas. In fact, good businesspeople are those who can execute typical ideas into a successful, profitable business. We shouldn’t wax poetically about our ideas and focus our effort on how to implement our business concepts.
- We overestimate its difficulty: If have never written or even seen a business plan, the process of creating one may loom higher than the Mount Everest. Like many new challenges, writing our business plan isn’t as difficult as we have imagined it to be. It’s actually less challenging than writing the next great novel or a doctoral thesis. If we are properly familiar with our business idea, we should be able to write the plan quite easily. There are helpful resources, like templates, software programs and books that can help us write plans properly. We can eat an elephant if we want to, but we need to have one bite at a time.
- We use meaningless phrases: We should avoid using meaningless and vague phrases like unsurpassed customer service, highest quality and best ever. This is the best way to lose our readers’ respect and interest. It is a bad idea to engage in hyperbole, especially if we can’t support it with measurable facts.