9 Common Business Plan Errors to Avoid

Posted: May 31, 2011 in Growing your Business

Steer clear some of the common blunders when drafting business plans. Here are common business plan mistakes to avoid.

  1. Never put off writing a business plan. Do not wait until you have enough time, have the right people or until you are presented with an urgent reason for you to draft a business plan.
  2. Do not confuse profits with cash. Waiting for customers to pay may cripple your finances without changing profits. Spending your money on purchasing inventory does not affect profits.
  3. Choose your priorities wisely. A business plan with 3 or 4 priorities is a plan that has power and focus.
  4. Do not overvalue a business idea. Write a business plan that shows how you will build the business around a great idea.
  5. Do not confuse a business plan with the act of planning itself. You need these two to become successful. The planning process doesn’t end when the plan is done.
  6. Do not forget to include the smallest details for the first twelve months. Cash flow is important but you also need the details such as dates, milestones, financials and deadlines.
  7. Don’t fuzz about the details for later years. Monthly details can be great in the beginning but is a waste of time later on.
  8. Do not create something absurdly optimistic. This can happen once in a generation but no one would believe that in business plan because it all claims that.
  9. Keep it short. A business plan needs to be concise and straight to the point.

A business plan software may also come in handy so don’t hesitate to use it.

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