According to research, business owners who create business plans are almost 100% more likely to successfully grow their business and secure an investment.
However, in order for a business plan to yield up these benefits, it has to be written to a high standard. Writing a business plan takes a lot of time and research, which is why it can be easy to make mistakes in the process.
We are here to help you avoid those mistakes by sharing with you the top business plan parts where issues often arise. Read on to find out what these are.
One of the first and most basic parts of a business plan you need to check is the format.
Formatting errors—like random font changes, spacing issues, and varying margin widths—will make anyone reading your business plan question the viability of the information, and your level of professionalism.
Spelling, Grammar, and Point of View
The other basic parts of a business plan to check are spelling, grammar, and perspective.
Spelling/grammar errors will not do your business plan any favors. We all make these types of errors, but leaving them laying about in your final draft gives a bad impression.
Any investor who comes across these errors will wonder what the rest of the business will be like if the business plan isn’t even up to scratch grammatically—and they are justified in thinking this. According to a BBC study, spelling errors can cost businesses millions in sales and revenue.
Therefore, get one or more people with strong English skills to review your final draft.
Additionally, avoid writing in the first person. This can sound unprofessional and self-promotional.
When writing a business plan, there are two common mistakes people make concerning details. These are including excessive amounts of details or being too vague and including little to no details.
Excessive details will detract from the key information. It will also make the plan confusing to read.
Too few details, however, will leave you a business plan with very little substance. These types of business plans are apt to be dismissed, as this indicates a lack of research and concrete market data.
As business plans are projections and therefore contain calculated assumptions, for them to be valid in any way they need to contain a groundwork of facts from which reasonable assumptions can be made. This is typically data relating to market and industry conditions, trends, competition, other forecasts, customer purchasing behavior, etc.
It is common for people who are in a rush to skip these facts when writing a business plan, but this is a big mistake. Without relevant data, a business plan can easily become just a compilation of assumptions made on top of each other.
If you do not have a head for numbers, it can be tempting to skimp on the financial projections.
However, to establish the viability of a business, a business plan needs to include accurate, detailed, and extensive financial projections and analysis.
If you are looking for a business loan, then it is crucial that you do not skim over this.
Any professional person who looks over your business plan will want to know about the competition. However, less experienced entrepreneurs often think that there is no competition for their business idea, and so don’t include any information.
Do not do this. Make sure that you research thoroughly all possible sources of competition and include these, as well as methods for overcoming them.
Pay Close Attention to These Business Plan Parts to Achieve Success
Now that you know about the business plan parts where things can easily go wrong, you are already equipped to avoid these common mistakes.