5 Deadly Business Planning Mistakes

By: Robert Thomson


Thousands of people want to start businesses each day and thousands of business plans are written and unfortunately most are rejected. Here are the 5 deadly sins and how to avoid them.

1) Your plan is waaaaay to long - many people think about writing as much as they can into their business plan just in case they miss something or simply just like writing stuff. People really just want to get to the point and understand who you are, what your business and products are, when you'll make a profit and at what level and as an investor what type of risk is the business and when will they receive their investment back. Really a plan of 20 pages is more than enough to write for most start up businesses.

2) It's in the wrong format - people who are reviewing your plan see hundreds per year and are used to a particular business plan template format and expect to see sections in the right place. So if you are writing for a bank use their format. If you are writing for another investor then use their format. Most are all the same but if you download something for free off the internet you'll likely have the wrong structure. Use oe of the corporate business planning sites as they have been around for years and know what a great business plan consists of.

3) Missing something important out - The content of your plan is vital and if you have forgotten something because you are using free software because you weren't prepared to invest a small amount of money getting your plan correct you'll look incompetent in your first finance meeting. So ensure your plan has all the correct components in the right order. There are a few elements that every investor looks for so just ensure you know what those are and put most time into developing those sections.

4) Unrealistic financial forecasts - unfortunately most new business owners believe they will take over the world in their first business and make millions in their first year and retire to a beach in 2 years time but this never happens so when planning your numbers be totally realistic and ask yourself why people are going to buy your products and where these people are and how you are going to market to them.

5) Limited or low skill set - if you are thinking of starting a restaurant or hotel but have never run this type of business before then the chances of success are minimal unless you are able to bring the right level of experience into your business by getting skilled staff and managers to help you. The most successful entrepreneurs start businesses where they already have the necessary skills and then build new businesses by either investing in their own training or by bringing on capable people. So think about what type of business you'll be a success in before sinking in thousands that could be lost in the future.

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James Darsmith is an expert business planning consultant and writes for business plan express uk website on all aspects of business plan. Visit www.businessplanexpress.co.uk for more information on writing your business plan today.

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