You’ve decided the time is right to take the leap and start your own business. Now that you’ve taken the first step, you need to write a business plan.
A lot of time and effort goes into researching and writing a winning business plan. While I recommend reaching out to a business plan professional to help put the polish on your plan, there are a lot of decisions that you will need to make along the way to help make sure you end up with a plan that you are proud to present to investors.
Here are some of the biggest mistakes you can make when creating your business plan:
Not Having a Plan!
You NEED a business plan. A lot of new businesses think that they can skip the process of writing a plan and just get down to business. Even if you aren’t going to be seeking outside investment, you need a plan for success. That plan is a roadmap to show you how to get from where you are to where you are going in the future. The process of writing a business plan makes you fully think through your business and evaluate its potential for success. You have to realistically think through the challenges and opportunities available in the market and have a plan for action before they arise. Your plan can be as formal or as informal as you would like. A notebook filled with ideas, solutions, and analysis will work just fine if you are keeping it to yourself. Go for a formal plan with graphical appeal if you are using it to secure funding.
Keep It Simple!
A business plan should start with the basics. The details are important, but you need to make sure that the reader understands the basics of your idea before you drown them in details. Start off with telling the reader what your product or service is and why the world needs it. Once you have answered the what and the why, you can delve into the details on what makes it different and dynamic about it. As you write the plan try to think about questions the reader may have and try to answer it as simply as possible.
Too Short Sighted
There is more to your business than the next three years. Investors and financiers want to know what you are going to do with their funding in the short-term, but you really need to understand where you are going in the long-term. While you will need to show how you can pay back any outside financing, it is important to have a plan for where you will be five or ten years down the line. You don’t need to kill them with details of the long-term vision, but should set some longer term milestones and some goals to aspire to as you move forward past this round of funding.
Forgetting the Rest of the World
You are not the only business out there. You probably aren’t the only one with the business idea either. There are other companies and entrepreneurs who have been there and done that. Look to their stories for inspiration and insight. Look at what worked for them and what failed. Identify opportunities that they may have missed. Make sure you’re not too much like the competition, but also recognize that you don’t have to reinvent the wheel.
About the author: The Business Girl is Terri Sullivan Biehn. I have been a professional business writer and management consultant for more than fifteen years. As a management consultant, I work with entrepreneurs to develop business plans and other documents. Through my consulting practice, I coach entrepreneurs and small business owners on their general start-up, marketing, financial, operational and management issues.