What makes a good business plan is less clearly defined.
Always remember that a business plan needs to be tailored to its target audience, if you have different audiences you will need to be able to flex your plan to that audiences specific needs. That means shaping it, edit it and amending it to achieve your objective.
- What is the problem which people will pay to have solved?
- Does your solution solve this issue for a specific target market?
- Why would someone buy your solution over someone else's?
- Why are the benefits of your offering so compelling?
- Can you reach that target market with a compelling message quickly and directly?
4. Executive Summaries Which Aren't
Somewhere between a pitfall and a cliff edge, is the failure of the Executive Summary, to be either a summary or aimed at executives. The only part of any plan that will certainly be read is the Executive Summary and yet they rarely provide an effective summary of the business plan. A good plan highlights the key proposition of the plan and sells the proposal.
Too many Executive Summaries either throw everything down in a jumbled mess, making them pages long and randomly pulling facts together, or they are so bland they say nothing!
What's a good Executive Summary, one that states the proposition clearly and succinctly, a page is sufficient for any plan. The Executive Summary should clearly explain the whole picture including what investment is required and what it will deliver. The point of an Executive Summary is to inform the executives, so many it punchy, outcome focused and only ever write it at the end.
5. Over Estimating Turnover
- Why investors should investing in this business rather than anywhere else?
- When will they recoup their initial investment and how and when it can be realised?
- What is their expected return on investment?
- How the company has managed all aspects of risk?
- Is the investment merely cash or do they need to bring other assets such as expertise to the table?
7. Non-Existent Cashflow Management
8. Non existent Management Teams
Throwing a few CV's into a business plan does not create a delivery team. Likewise a generic organisational chart with missing pieces and TBC (To Be Confirmed) is not going to inspire confidence with investors to part with their cash.
Entrepreneurs can often sell an idea but they do not always inspire they can select a balanced team of people with the right skill mix, from the financial management to key leadership roles and the right operational team to deliver your ambitious plan.
Having a structured management team with operational structures is essential for success. Track records matter, as much as having clear roles and responsibilities laid out in delivering the operational plan which underpins the business plan.
9. Poor Evidence of Demand