7 Things to Avoid in a Business Plan
We prepare a business plan because we don't have money and we need others to finance it. The other reason for preparing the business plan is for yourself. You need to know how you will target your market and how you start working on achieving the goals set for your business. If you are presenting your business plan in front of your potential investors there are certain things you would like to avoid:
Don't beat around the bush
No matter how you present your business plan, the investor is only interested in your product and its selling point. Tell them what your product is and how you plan to sell it. Be clear on your idea of creating value for the user of your product. Unless your plan creates value to the users, investors won’t bother to listen to you. Talking too much about motivational stuff and your personal story might put them off and give the impression that you do not value their time.
Don’t use jargon
Chances are that the investor may not be from your field of work. You need to use simple words that your investors and your customers can understand. For instance, if your product involves 3D printing, use words that you would use to make your grandfather understand about 3D printing. Too much technical jargon can confuse the investors who would never invest in an idea they do not fully understand.
Don’t fall into assumption pit
The very idea of business plan lies in making predictions. However that does not mean that you put figures that can’t be justified. Match your financial predictions with the probable cost. It’s crucial that you research the figures before putting them in your plan. Tie your assumption to benchmarks from the same industry or other acceptable standards.
Avoid being unprofessional
The investors are less interested in your personal achievements and more on your plan. While some of us have this urge to mention our experiences or curriculum vitae in the plan just to make us more impressive, that won’t do any good. Rather it depicts the picture of being unprofessional.
Don’t confuse your target market
We want that picture perfect presentation that will blow the investors' mind away. But sometimes we happen to work and rework on our plan so much that at the final presentation we are kind of lost and confused about our target market. Nothing makes a plan better than having a focus target market. Your niche market gives you a competitive advantage. Don’t lose it while amending and adding more products and services over the preparation time. Be intact with what you can deliver and what you want the product to be.
Don’t rush to output
A perfectly written plan paper with correct spellings, punctuation and grammar may not be a sure shot for getting funds but a paper with such errors can be seen as unprofessional and make it difficult to get the fund. Proofread the paper, check for grammatical errors, watch the layouts, margins or seek professional help. Do not rush to submit the plan unless you are a 100% sure that there are no inaccuracies.
Avoid incomplete plans
Nothing makes an investor sadder than an idea with potential but that hasn't been thought through well.
The customers, marketing and sales, competitors and industry trend should be addressed in your plan. Financial projections- monthly cash flow, income statements and annual balance sheet of at least three years gives the complete touch to your plan. Make sure that the business plan gives the complete picture of how you will create value for your customers and generate revenue for your investors.