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As a business consultant and MBA prof, I am often called on to help out with or critique business plans.
Inevitably, the businesses that fail to get funding or even get off the ground have made similar errors with their business plans.
You’re excited, inspired, and poised to take the plunge (congratulations, by the way! There’s an abundance of tips on how to craft executive summaries, marketing plans, and projections.
Unfortunately, Googling “writing a business plan” yields an intimidating 99,600,000 results. We (Oath) and our partners need your consent to access your device, set cookies, and use your data, including your location, to understand your interests, provide relevant ads and measure their effectiveness.Oath will also provide relevant ads to you on our partners' products.What mistakes have you made when writing a business plan? We’d love to hear your tips for avoiding certain pitfalls in the business plan writing process and how you stayed on track during it! • Document booking orders with supporting data indicating the number of customers who have committed to purchase.This allows you to provide a convincing projection of the “rate of acceptance” for the product or service and the pace at which it is likely to be sold. Failure to Anticipate Investors’ or Lenders’ Requirements Too often, business plans skim over the meat and potatoes of financial planning and don’t consider what the needs of those who are supplying the cash. Inability to Emphasize & Demonstrate Management Depth • Does your management team have: Proven industry experience? Track record in bringing new products / services to market?Inability to adapt or listen to experienced advisors is a critical mistake. Of course not, but not being able to hear and adapt to fair criticism is a key element of business failure. Lack of Realistic Financial Projections Investors and lenders will focus on the accuracy and integrity of your financial numbers.Projections and revenues, gross margins and earnings have to be carefully supported by assumptions that are reasonable and that can be defended. Don’t just give a hockey stick growth projection – demonstrate that you have injected realism!The following is an excerpt written by Tim Berry, president of Palo Alto Software, Inc., which compiles a list of the most common mistakes that people make when writing a business plan.Top Business Plan Mistakes To avoid making these common mistakes, you must first become familiar with them.