Every business should have a business plan capable of attracting investors and $/$ or financiers.

Unfortunately, despite the fact that many underlying businesses are viable, the vast majority of

business plans are hardly worth the paper they are printed on$.$ Most $$bad$$ business plans share one or

more of the following problems:

$1.$ The plan is poorly written. Spelling, punctuation, grammar and style are all important when it

comes to getting your business plan down on paper.

$2.$ The plan presentation is sloppy. Once your writing's perfect, the presentation has to match.

Nothing peeves investors more than inconsistent margins, missing page numbers, charts

without labels or with incorrect units, tables without headings, technical terminology without

definitions or a missing table of contents.

$3.$ The plan is incomplete. Every business has customers, products and services, operations,

marketing and sales, a management team, and competitors. At an absolute minimum, your plan

must cover all these areas. A complete plan should also include a discussion of the industry,

particularly industry trends, such as if the market is growing or shrinking. Finally, your plan

should include detailed financial projections$--$monthly cash flow and income statements, as well

as annual balance sheets$--$going out at least three years.

$4.$ The plan is too vague. A business plan is not a novel, a poem or a cryptogram. If a reasonably

intelligent person with a high school education can't understand your plan, then you need to

rewrite it$.$

$5.$ The plan is too detailed. Keep the technical details to a minimum in the main plan$--$if you want

to include them, do so elsewhere, say, in an appendix. One way to do this is to break your plan

into three parts: a two$-$ to three$-$page executive summary, a $10-$ to $20-$page business plan and

an appendix that includes as many pages as needed to make it clear that you know what you're

doing. This way, anyone reading

$7.$ The plan includes inadequate research. Just as it's important to tie your assumptions to facts,

it's equally important to make sure your facts are, well, facts. Learn everything you can about

your business and your industry$--$customer purchasing habits, motivations and fears; competitor

positioning, size and market share; and overall market trends. You don't want to get bogged

down by the facts, but you should have some numbers, charts and statistics to back up any

assumptions or projections you make. Well$-$prepared investors will check your numbers against

industry data or third$-$party studies$--$if your numbers don't jibe with their numbers, your plan

probably won't get funded.

$8.$ You claim there's no risk involved in your new venture. Any sensible investor understands

there's really no such thing as a $"$no risk" business. There are always risks. You must understand

them before presenting your plan to investors or lenders. Since a business plan is more of a

marketing tool than anything else, I$\text{'}$d recommend minimizing the discussion of risks in your plan.

If you do mention any risks, be sure to emphasize how you'll minimize or mitigate them. And be

well prepared for questions about risks in later discussions with investors.

$9.$ You claim you have no competition. It's absolutely amazing how many potential business

owners include this statement in their business plans: $"$We have no competition."

If that's what you think, you couldn't be further from the truth. Every successful business has

competitors, both direct and indirect. You should plan for stiff competition from the beginning. If

you can't find any direct competitors today, try to imagine how the marketplace might look once

you're successful. Identify ways you can compete, and accentuate your competitive advantages

in the business plan.

$10.$ The business plan is really no plan at all. A good business plan presents an overview of the

business$--$now, in the short term, and in the long term. However, it doesn't just describe what

the business looks like at each of those stages; it also describes how you'll get from one stage

to the next. In other words, the plan provides a "roadmap" for the business, a roadmap that

should be as specific as possible. It should contain definite milestones$--$major targets that have

real meaning for your business. For instance, reasonable milestones might be "signing the $100$th

client" or "producing $10,000$ units of product." The business plan should also outline all the major

steps you need to complete to reach each milestone.

To make a $$bulletproof$$ business plan, the aforementioned mistakes must be avoided, and the following must be done.

Think through the business idea. You might have a great idea, but have you carefully mapped

out all the steps you'll need to take to make the business a reality.

$$ Do your research. Investigate everything you can about your proposed business before you

start writing your business plan$--$and long before you start the business.

$$ Research your potential customers and competitors. Is your product or service something

people really want or need, or is it just "cool"? Study your market. Is it growing or shrinking?

Could some sort of disruptive technology or regulatory change alter the market in fundamental

ways? Why do you think people will buy your product or service? If you don't have any customers

or clients yet, you'll need to convince investors that you have something people really want or

need, and more important, that they'll buy it at the price you expect.

$$ Get feedback. Obtain as much feedback as you can from trusted friends, colleagues, non$-$profit

organizations, and potential investors or lenders. You'll quickly find that almost everyone thinks

they're an expert and they all could do a better job than you. This may be annoying, but it's just

part of the feedback process. You'll know when you're done when you've heard the same

questions and criticisms again and again and have a good answer to almost everything anyone

can throw at you.

$$ Seek professional help. Find a professional you trust to help guide you through the entire

process, fill in knowledge gaps $($for instance, if you know marketing but not finance, you should

hire a finance expert$),$ provide additional, unbiased feedback, and package your plan in an

attractive, professional format.

Required

Come up with a business idea and write a business plan capable of attracting investors and

lenders. $$

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