Business plans are essential, especially if you’re looking for capital and need to convince people that your idea is viable. However, not everyone can nail the business plan and impress investors. In fact, most people fail at it rather spectacularly if they don’t have help from a professional. If you know what you’re doing, you’ll be able to avoid problems that would harm your chances of getting the finances.
Consider the following mistakes and alter your BP accordingly for better chance of success.
Not Addressing the Business Plan Well
Consider who you’re writing for before you even start writing a BP. There are several people who draft a generic plan, without considering their audience at all. This simply defeats the purpose of the document. You need to make sure that your business plan addresses specific concerns of the investor.
It’s a good idea to research just who you’re presenting the plan to. You can contact people who have worked with the investors before to understand their concerns. The more clear and personalized your BP is, the more satisfied your investor will be.
Not Being Succinct and Precise
It’s never a good idea to waste the investor’s time. There are some business owners who’ll try to explain every little detail about their business in the BP. In most cases, the investors aren’t really interested in the details, especially not in the beginning. It’s a good idea to just stick to the relevant points and make sure that you’re precise. Stick to the concerns that the investor would be interested in.
One way to avoid excessively lengthy business plans is to read it and reread it as many times as you can. Be sure to give yourself a considerable gap between the readings. This would help you edit any errors as well. You should also ask a friend or a family member to read the plan before you can show it to the investor.
Not Being Clear on Your Finances
Investors are looking to make a profit and the financial section of your business plan is of keen interest to you. Incidentally, this is also a section that business owners are most nervous about. It’s a good idea to be very clear about what your projected profit margin is and what it is based on. Make sure that you’re sticking to the truth and given the investors and honest account of potential profits based on solid facts and research.
This is the most important section of your business plan and should be written carefully. It would be a good idea to have a professional review this particular section. The fewer mistakes you make here, the better.
Not Identifying the Market Clearly
The final step here is to identify the market that you need to target. There are several business owners that speak about this aspect in very board terms. When you do that, you present a very incomplete idea to your investors. You should precisely state who your target audience is and how your product or service would help them.
If you keep these mistakes in mind, you’ll be able to create a business plan that’s appealing.