10 The Biggest Problems with Business Plan and How You Can Fix Them
It is the fact that each business should have a business plan. Despite this, several businesses lack having proper business plans or their plans rarely worth the paper printed upon. Most of them have one or more of the following issues:
- Poor writing
Style, spelling, grammar, and punctuation all are crucial when it comes to noting your business plan down on paper. No investor loves to invest in the organization. The investors look for the leaders who will run the company while pursuing a business plan. They instantly get surprised what is the problem with the commerce when they come across the plan with spelling and other grammatical errors. As a large number of people are looking for capital for their startup business, so they move to the next plan.
- Sloppiness in the presentation of a business plan
Once you write your business plan, you have to match it with the presentation. Issues like missing page numbers, inconsistent margins, lack of a table of contents, technical terms without definitions, charts with wrong units or without labels and tables with no heading are enough to make an investor anxious with the plan. You can take months to prepare a plan, but an investor takes only 10 minutes to decide on the investment. Before presenting, hire a professional business plan writer for proofreading and matching the content with its presentation.
Each business consists of products/services, clients, marketing & sales, operations, competitors, and a management team. You must cover all these areas while writing your business plan. A complete plan also has an industry discussion, especially industry trends. At last, it should have detailed financial projections like annual balance sheet and monthly income.
A business plan is different from a cryptogram, a novel, or a poem. You must rewrite it if a high school pass out cannot comprehend. Place your executive summary in the beginning if you want to hide the vague information as your business plan consists of highly sensitive technologies, materials or processes. With this, you can encourage investors to know more about your trade.
- Too much information
Avoid writing down technical terms even if you are a technology-based startup. If you want to mention technological details, keep them at a smaller scale or place somewhere else, i.e., in an appendix. The best way to include technical stuff is to divide the plan into three parts like as
- 2-3 pages for an executive summary
- 10-20 pages for a business plan
- An appendix for technical terms
With this, it will be easier for anyone to get the details as per their wish while reading the plan.
- Unrealistic assumptions
Due to their nature, business plans have lots of assumptions, and the crucial assumption is that your trade will succeed. The best one has critical assumptions along with their rationalization while the worst one has nothing but assumptions and is far away from the facts. Assumptions should be based on customer purchasing behavior, market size, time for commercialization, and acceptable prices. To make your plan worth, you should examine the benchmarks from the same business sector. Try to match the assumptions with facts.
- Inadequate research
As the importance of interconnection between assumptions and facts, ensuring that your facts are facts is crucial. You should have ideas about everything – market size & share, customer behavior, motivations & fears, competitors’ positions, etc. While writing your business plan down on paper, you should have facts, numbers, statistics, and charts to support your assumptions. You can do all these well by conducting in-depth research on every aspect of your commerce.
- Claiming your business has no risk
We all know there is no business without risks. You should keep in mind that companies have challenges; you should avoid presenting your plan having no risk. It would be better for you to minimize the risks and emphasize how you will tackle those risks.
- Lack of competition
Claiming that your business has no competitor is totally wrong. It’s far from the truth if you mention that your business has no competition in the market. Whether it is direct or indirect, every successful company has competitors from the beginning. Imagine how the marketplace would be when you become successful if you do not find direct counterparts in the initial stage. Besides, know the ways how you will compete for the same.
- Business plan – not a plan at all
An excellent business plan discloses a glimpse of the trade in short as well as long term. Apart from explaining how the business will look like at every stage, it shows off how it will go from one step to another. In simple words, it describes a roadmap for commerce. The roadmap should be as particular as possible. It should have certain milestones – significant targets.
Ways to fix problems
Once you have ideas on mistakes not to make, there are still a few ways that you should follow in drafting an excellent and bulletproof business plan. The steps are as follows:
- Have sound knowledge about the business you are planning to start – You have an idea. That’s great. However, you should map out all the steps involved in bringing the concept into reality. Consider developing your management team, hiring staff, setting up the process to protect from the lawsuits, figuring out the market competition, and so on. In brief, you should have sound knowledge about the business before its launch and while writing the plan.
- Conduct in-depth research – Examine everything linked to your prospective business before you start noting the plan down on paper. And it should be long before you start your business operations. You should do in-depth research while writing your business plan. With the study, things will change as you come across critical information. Ensure to consult multiple resources while carrying out your research.
- Get feedback – Getting feedbacks helps you identify your faults. You can take support from your faithful colleagues, friends, NGOs, or probable investors/purchasers. In your search, you can come across everyone saying that they are expert on this. However, you should be very careful, and you should take their advice as feedback. Trusting everyone can be harmful to you.
- Take professional support – To get a well-written business plan, you should find out a trusted professional who can guide you through the entire process. You have the required backing of drafting to feedback while noting down the plan. Hiring professional support will be a great help to you.
Noting your business plan down on paper is a tough task. People take a year or more to write their proposal. A software tool can help you in drafting the stages. However, the main problem will be while creating the right picture of your business. You should tie all the elements of your trade to make your plan fruitful.