1) Skimping or over thinking your business plan
It is said that you need to create a business plan when you are considering opening a company. If you go into a bank asking for a loan, they will ask about your business incorporation and business plan for them to look over. They will want to look over your business plan to ensure that you established how your business is going to make money and how much is projected to be made. You might believe that this is the only information that needs to included in your business plan then. Not at all.
Your business plan needs to cover your entire process, from your management team to your marketing strategy. This helps to identify if you have the right strategy in place to make the money you have projected. You cannot tell a bank that you plan to make $100k your first year of business but you have no marketing and sales strategy. What you want to accomplish is not realistic without having these two strategies being in place.
Even if you are not seeking a loan from a bank, you will still need to create a business plan to guide your actions. You do not want to just being doing things that do not lead to your business growing. Therefore, your business plan helps to identify your goals and objectives and explains how they will be accomplished. This gives you an exact plan of action to follow so that you are operating with a purpose.
Just do not make the mistake of over thinking your business plan. Your business plan does not need to be 100 pages long, covering every exact detail of your business. This only leads to procrastination because you are trying to make your business perfect. No business is perfect. You will deal some mistakes, but the biggest mistake is not having a business plan before starting your business. All you need to do is outline your strategy, not write a business book.
This is the information that should be included in your business plan:
- Vision — the model you are working towards when developing your business.
- Background — why you are capable of operating the type of business you are starting.
- Goals — targets your business needs to hit in order to be considered successful.
- People — the background and experience of the people who will help you build your business.
- Products — the type of products and services you plan on offering in the marketplace.
- Competition — the other companies you are competing against and how your business will differentiate itself.
- Marketing — the strategy that will be used to effectively communicate to your target market.
- Funding — the source of financial investment that will be used to start and operate your business.
- Measurement — the progression of your business to ensure it is moving along as planned.
- Exit plan — the plan of how the business will continue after your have exit or sold your business.
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