Three Mistakes to Avoid when Preparing a Business Plan

When developing your business plan look out for these three mistakes common to new entrepreneurs:

Mistake #1: Ignore the Needs of Your Readers
Not only should you know what your intended readers will look for in your business plan, but you should write with their specific needs in mind. This does not mean subverting the intention of your business or inflating your projections, but to keep in mind the questions they will ask and attempt, one by one, to eliminate those questions in the draft of your plan. If readers see holes in your plan, unsatisfactory returns, or unrealistic assumptions they will probably dismiss your plan without even providing feedback on how to improve.

Mistake #2: Write First, Ask Questions Later
By setting pen to paper to write section after section of your plan before you have crafted an overall strategy for your business, you are putting the cart before the horse. There are key strategic questions to ask yourself (and come up with satisfactory answers for) before writing out any of the plan. For example, you should delve into why your management team is well qualified to launch the business, how you will make operations more efficient over time, how much you can plan to scale up the business in the first years of operation, and what industry best practices you will make use of. Writing sections of the plan before thinking deeply about these questions can lead to time-wasting rewrites down the road.

Mistake #3: Be Everything to Everyone
Plans which describe a vast customer target market and the need to have a huge list of offerings may seem attractive due to the large potential sales. However, launching a new business with this strategy is extremely difficult. Selling a specific product line to specific market segments shows readers that you have surveyed the possibilities and made a key decision as to where your products can have the greatest impact. Readers like to see that your decisiveness as a manager rather than a plan that can be considered vague in its direction.


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