A business plan is a must-have component for any business enterprize. It is needed to attract investment funds, but goes far beyond that in its usefulness. It maps the road to success, outlining your entire business operation and marking weak spots or potential dangers. It ensures you run a realistic budget and set bold, yet achievable goals. In short, a business plan can serve as your compass, map and best advisor.
Simply sitting down and charting your idea allows you to see how you reach success, both by clearly communicating its feasibility to investors and making sure you know what road to take on your way to success. Additionally, it will keep your team on the same page, making communications much, much more efficient. This last bit will become absolutely invaluable as the company grows and communication becomes more cumbersome and time consuming. Simply posting your plan’s abbreviated version on the office wall will keep the employees and partners informed and save you lots of unnecessary explaining.
Oftentimes, writing a plan can help you get a clear understanding if an idea is worth pursuing in the first place. It is a fact that if the numbers add up, then there is potential. Sometimes an idea only seems amazing, but when you consider the cost of production compared to predictable revenues, it turns out that it is not really worth the effort.
Testing the idea on paper, just for your own use and understanding, is therefore also very important. You need to see the vision, the basic financial forecasts and the proposed strategy. Once you’d done that, you might find out that there is lots to improve about the idea. This realization is timely before you reach out to investors and put money and effort in your operation. Get rid of all possible mistakes and miscalculations on the drawing board, where they cannot really hurt you.
A business plan gives you focus, direction, structure and clarity. Now that we have established the need to have a business plan, let’s go over a few important pointers that you should keep in mind when you sit down to compose yours.
- Less is More. Get rid of the bells and whistles, don’t let them obscure the essential parts of the plan. Be concise and to the point. The fluff takes up time and space, and gets you distracted. What’s even worse, investors see it for what it is and they don’t like it one bit. Impress with facts and numbers, not ornaments.
- Stay Real. While optimism is important, exaggerations are not a good idea, either. Be honest with yourself, and see the challenges for what they are. Ignoring them will only lead to trouble, so be prepared.
- Show Prudence. Every entrepreneur will say that they are conservative, but saying it is not enough. Show your investors that you are going to do it right by giving examples to show your approach and projections.
- Use Visuals. Try not to overdo it, but do use visuals. Implementing graphs, diagrams, pie charts and imagery will paint your picture more vividly and the point will be easier coming across. It will also create respites that will help the flow of the presentation.
- Be Creative. Creative people get appreciation and attention. Investors like an entrepreneur who can improvise and come up with something new and refreshing. Make your presentation stand out and it will make an impression.
We hope this helps in putting your enterprise on the right track. For more information, advice or help creating your winning business plan, give us a call and we will get right on it.