A business plan is one of the most important documents you’ll ever have to write. A business plan can secure your future. Or it can have the completely opposite effect.
A business plan can persuade a lender to part with large sums of investment money. Equally, it can show them that your business is not an investable prospect. So, getting your business plan right is essential.
Set Specific Goals
Break the business plan down into sections so that you can write down your goals that will be achieved over a certain timeframe. So, what will be done during the first year? The second? The fifth? What happens after that? Will you buy vehicles from Eastern BMW, will you purchase stationery from Viking Direct, will you find office furniture at Ikea?
Make these goals as specific as you can as it will give your potential investors a much better idea of what you want to achieve.
Keep It Brief
Although you might be tempted to fit every single aspect of your business and its goal into your business plan, the best thing you can really do is to keep it brief and concise. Those who are reading it are busy, and they have other things to do, so the less time spent reading your plan the better for them.
Since your business plan will never be able to anticipate all the questions that might be asked of you, don’t worry about it. Trying to include everything is time-consuming for everyone involved, and is simply not worth it. Keep the answers to the questions in mind for when you discuss that business plan once it has been read.
Don’t Oversell It
Of course, one of the purposes of a business plan is to sell your business to a lender or investor. You want that person to be as excited as you are about the things that this new business could do if given the chance, and your business plan can make that happen. However, if you oversell you could be in trouble.
The key is to think of the business plan as a brochure. Just like you would enjoy looking through brochures for a new car, a holiday, or any other major purchase, the brochure is there to get you interested and make you want to know more. This is what the business plan should do.
If you oversell, however, if you load your business plan up with how wonderful the business is and how marvellous it’s all going to be without going into specifics, you can very easily put people off altogether.
Don’t Forget Your Competition
A business plan needs, above all, to be honest. It needs to explain what your business is all about and of course it needs to project where the business will be in a number of years. However, it also needs to mention any negatives or downsides – and that can include the competition.
Your business partner, investor, lender will want to have the full story before committing any cash to your business, and finding out all you can about the competition will certainly help them. It will show that you understand your market and that you know that you need to be different to stand out.
The problem with not mentioning the competition is that it can give investors the wrong idea. You may think that not saying anything about anyone else doing the same as you gives you the advantage, but it can actually make those with the money think that there is no market for your product.