5 Common Business Plan Mistakes to Avoid
Have you been thinking about starting up a business lately? If so, we think that is absolutely awesome. There is nothing like putting all of your knowledge and skills into one of your own dreams that you can turn into a reality. Of course, being that half of all businesses close their doors within five years, we definitely want to make sure that you do all that you can to get off on the right foot and hat would start with having a good business plan.
If you would like some tips on how to avoid some of the common business plan mistakes that many people tend to make, we have included what we consider to be the Top Five below:
Failure to do enough research. When starting a business, there are a lot of things to consider. Not only should you focus on the kinds of products or services that you will need to provide but also if there is a marketplace for what you have to offer. Plus, it’s a good idea to look into how much competition that you might have, the current advertising trends that exist and the demographic that you need to cater to.
Not being thorough. If you are drawing up a plan to present to potential investors, you have to be prepared to foresee as much as possible the kinds of questions that they’re going to have. This would include sharing your mission statement, how you plan to cater to your customers, your sales and marketing agenda, the kind of staff that you’re looking to hire, if it will have a physical location or be a virtual/satellite office and what your financial projections are.
Having too many errors. A business plan is going to be your introduction into what you have to offer. So, it needs to be written well, there need to be virtually no grammatical errors and you need to provide accurate data and statistics. For this reason, it’s a good idea to have someone that you trust who is knowledgeable in your particular field to review your business plan before you present it to potential investors or lenders.
Providing too much (initial) information. We’ll be the first to admit that there’s a fine line between being thorough and “oversharing”, but it’s imperative that you master this line. There are many people who find themselves in intellectual property issues all because they presented too many details about their business plan without requiring that the interested parties sign a non-disclosure agreement first. Although not a lot of people will be willing to do this on the front end, this heads up will remind you to clear and concise with your presentation and to share more than is necessary only if individuals are willing to sign on the dotted line.
You’re not honest about the amount of risks involved. If you asked a company like www.teneric.co.uk what your business plan needs to state, one of the things that they would probably tell you is that it’s important to mention that you are aware of the fact that you have competitors and that there are a certain amount of risks involved. The key here is not to focus so much on what those people and risks are so much as what you are prepared to deal with and the solutions that you already have in tow. That will send the message that you’re not just “hopeful” but also very realistic about your company’s future. To a potential investor or lender, that will be appreciated on their part, which makes things ultimately beneficial for you in the long run.
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