A business plan is a very important business tool to have as an entrepreneur. Not only does it provide a clear path towards actualizing a business idea, it improves your chances of success and can communicate your idea to investors. Business plan mistakes can result in anything from small setbacks to fatal errors for your business. Especially for businesses seeking funding, it’s crucial that your information is correct and none of your ideas are misrepresented. To help you avoid future stumbling blocks, here are critical business plan mistakes to be cautious of;
Detailed assumptions; the core of any good business plan is based on solid assumptions, which enable entrepreneurs to do accurate forecasting. An assumption is a premise that helps you forecast future results, and allows you to simulate how your business will perform. Entrepreneurs will typically need to make assumptions about three key areas when writing a business plan: Sales, variable costs and fixed costs. Detailing your assumptions and objectives will also help you establish specific marketing strategies and identify resources that are required to meet your objectives.
Never forget start-up requirements; a common mistake in business plans is omitting to outline start-up requirements. It’s imperative to clearly discuss the details required for the project than to state the amount needed, this shows the reader you have done your homework very well.
Have supporting information; Backing up your assumptions is also crucial when writing an effective business plan. Supporting information can include feasibility studies, surveys, market analyses, information about key competitors and industry overviews. The reader should see clear footnotes that point to your supporting documents. Information must be clear and concise.
Emphasize human resources management; Business owners often overlook human resources management in business plans, when it’s actually a major element to consider. In a shrinking labour market, human resource poses many challenges to entrepreneurs today, particularly when recruiting ,when preparing your business plan you have to show that you know precisely how you will attract skilled staff to operate your company. Business plans should include your organizational structure, as well as clear human resource requirements such as recruiting and outsourcing strategies.
Having a consultant revise your plan can help you make a stronger business case. It’s good to have that objective point of view. Sometimes it’s difficult to see weaknesses in your document and where you can improve it.
At Korsell Corporate Consult Limited, we help you with your business planning, strategy document and other custom services. Speak to us now 055 391 9618 or Email: firstname.lastname@example.org