What to Avoid in Your Business Plan
Posted by accountingweb on 122
When writing a business plan here are some things to avoid:
- Form over substance. If it looks good but doesn't have a solid basis in fact and research, you might as well save your energy.
- Empty claims. If you say something is so, back it up in the next sentence with a statistic or fact or quote from a knowledgeable source that supports the claim.
- Rumors about the competition. If you know for sure one is going out of business you can allude to it, but avoid listing their weaknesses or hearsay. Stick to facts.
- Superlatives and strong adjectives. Words like major, incredible, amazing, outstanding, unbelievable, terrific, great, most, best, and fabulous don't have a place in a business plan. Avoid ``unique" unless you can demonstrate with facts that the product or service is truly ``one of a kind". Your opportunity is probably not unique.
- Long documents. Keep it under 25 pages total. Write whatever you want to write, but keep it at home. If they want details, they will ask.
- Over estimating on your financial projections. Sure you want to look good, but resist optimism here. Use half of what you think is reasonable. Better to underestimate than set expectations that aren't fulfilled.
- Overly optimistic time frames. Ask around or do research on the Internet. If it takes most companies 6-12 months to get up and running, that is what it will take yours. If you think it will take 3 months to develop your prototype, double it. You will face delays you don't know about yet--ones you can't control.
- Gimmicks. Serious investors want facts, not hype. They may eat the chocolate rose that accompanies the business plan for your new florist shop, but it won't make them any more interested in investing in the venture.
- Typos and misspelled words. Use your spell checker, hire an editor or have four people read the document from back to front, but get those errors out of there if you want to be taken seriously.
- Amateurish financial projections. Spend some money and get an accountant to do these for you. They'll help you think through the financial side of your venture, plus put them into a standard business format that a business person expects.
By, Kaye Vivian, Business and Marketing Consultant