5 MISTAKES TO AVOID IN AN AWARD-WINNING BUSINESS PLAN
5 MISTAKES TO AVOID IN AN AWARD WINNING BUSINESS PLAN
While creating a business plan necessitates thorough planning, there are a few pitfalls to avoid when getting ready to put one together.
To help you avoid making mistakes, we’ve compiled a list of five common blunders to avoid, whether you’re writing your first business plan or have done one before.
- Do not conduct market research.
- Make an educated guess of the cost of your overheads.
- Make an improbable prediction
- Ignore the document’s professional aspect.
- Extensive executive summary
- Do not conduct market research.
Market research can be a time-consuming procedure that necessitates a lot of effort on the side of the entrepreneur to get the necessary data. Many entrepreneurs believe it is best to avoid it entirely and instead acquire a basic notion of what the market is like before launching their company.
Don’t make the same error as the first time. Don’t forget to conduct market research! This crucial phase will not only offer you a greater grasp of the industry you’re entering, but it will also provide you with the tools you need to compare your project to competitors and ensure you’re on the correct track. A thorough market analysis will be an important aspect of any business plan. It will give your project more credibility when you present it to a bank or potential investors.
- Make an educated guess of the cost of your overheads.
You’re probably aware that overheads are the most significant costs associated with starting a new business, mostly because they allow it to function on a daily basis. It’s simple to believe you can estimate your overhead costs roughly.
This is where you should not rely on your personal understanding and instead request quotes from possible vendors to ensure you have accurate information. These quotes will be included in your business plan to show potential investors that you have done your homework and that the risks of not having enough cash flow to cover your overheads are minimal.
- Make an improbable prediction
It’s reasonable to have reservations about your financial forecast or any other aspect of your business plan, especially since you’ll never know for sure how much money your company will make until it’s up and running. However, you should avoid the temptation of making exaggerated estimates that may be unreasonably high.
It’s best to keep your expectations low if you’re unsure. Of course, doing the necessary calculations ahead of time will help, and that is why it is important. Creating a financial estimate for your business plan should be as precise as possible, taking into account a variety of aspects such as your capacity and the results of your market research.
- Ignore the document’s professional aspect.
If you’re more interested in the business side of things than the writing side, you might overlook the importance of being comprehensive when putting together your business plan. Writing a business plan does not imply having a basic layout of your goals and objectives, but rather a clear and complete explanation of your goals and objectives, highlighting every component of the firm. Many people recommend organizing your business plan into sections and subsections, including resources such as maps, quotes, and images to back up your assertions. You should also check for grammatical and spelling problems in your business strategy. When you submit your proposal to investors, having a professional-looking document ensures that your business plan is investor-ready.
- Extensive Executive Summary
The executive summary is where readers of a business plan, such as investors, bank institutions, and important vendors, first assess your business proposal. The executive summary is a succinct but informative summary of the most critical aspects of your business strategy.
It should clearly express how a highly competent team will deliver items or services to precisely defined target markets in accordance with a consistent strategy.
Furthermore, it should highlight the company’s value proposition, which explains how their products or services will improve the lives of their customers in a lucrative way.
In truth, many executive summaries are dull and outline a company concept whose implementation is hazy. It is frequently presented as a cut-and-paste job of elements of the introduction and other parts of the business plan.
As a result, if the executive summary does not present a clear, convincing, and persuasive description of the firm, the busy investor is likely to move on to the next proposal.
Read Also: 10 REASONS WHY BUSINESS PLANS DON’T WIN GRANTS IN NIGERIA
5 MISTAKES TO AVOID IN AN AWARD WINNING BUSINESS PLAN
OTHER MISTAKES ARE
- Making growth expectations that are unreasonable and aggressive
Many investors skip straight to the financial section of the business plan after reading the executive summary. It’s critical that the assumptions and forecasts in this section are accurate. Plans that demonstrate sales forecasts, operating margins, and revenues that are poorly reasoned, internally inconsistent, or plain unrealistic severely undermine the overall business plan’s credibility. Financial assumptions and projections that are grounded and well-supported, on the other hand, show operational maturity and confidence.
In your financial analysis, benchmarking is a particularly useful instrument. You may establish that your assumptions and estimates are feasible by comparing and basing them on the financial performance of public companies in your market.
In this aspect, Planium Pro makes your life easier. The finance part of Planium Pro’s software includes a simple and quick benchmarking tool for a range of industries, allowing you to compare your estimates and key ratios to market averages.
- A lack of understanding of the target audience and segments
There is no such thing as a product or service that can satisfy everyone’s needs. We’d all be using the same phone if that were the case. In truth, your product or service caters to a certain and desirable type of customer. You can’t think about how you’ll handle the strong competition unless you define your target market. There are other companies that offer the same product and service. Investors put their trust in businesses that have completed and achieved a thorough understanding of the primary and secondary markets. You must identify your target market and plan how you will reach out to them.
If you need a service of a Professional Business plan writer, then Dayo Adetiloye Business Hub is the place to go Call or WhatsApp us now on 081 0563 6015, 080 7635 9735 or send an email to dayohub@gmail.com and we will solve any of your business plan problems.
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