Whether you’re a budding entrepreneur or an experienced business owner, having a water-tight business plan is a must. However, as with many aspects of running a business, there are a number of important points to consider. Here we summarise some basic business plan dos and don’ts.
 
DO your homework
 
You will need to be able to show that there is a market for your goods or services, and to research the competition. You should also assess how both are likely to change in the future. If you are applying for funding or a grant, be sure to check that the help you are applying for is still available.
 
DO include a mission statement
 
In essence, your mission statement explains why your business exists. When you encounter a problem or a key decision, the answer will be informed by this mission. Think about why you started the business, and imagine where you want to be in the future. These two elements will provide your mission statement.
 
DO carry out a SWOT analysis
 
Be sure to analyse your business’s strengths, weaknesses, opportunities and threats. List each category in full and be honest. Done correctly, this ‘SWOT’ analysis will help you to take an objective and critical look at your business in its entirety.
 
DO put it in writing
 
Make sure you write down your finished plan. Include the mission statement, SWOT analysis, goals and plans, budget and forecasts, and make it clear who is responsible for doing what. Share it with your key staff and shareholders, and encourage their input. Give your plan a professional feel by using graphs, pie charts, photos etc, but use the same typeface and colour throughout.
 
DO tailor the plan to the audience
 
Consider tailoring the plan to different audiences, as they will each have very specific requirements. For example, your bank will be interested in how you intend to repay a loan or overdraft and how it will help the business grow, while shareholders will want information on the prospects for the share price and what say they might have in the business.
 
DON’T be too over-optimistic
 
Most business plans are over-optimistic, especially as regards predicted sales, often hugely overestimating the size of the market. Too many business plans include a SWOT analysis, but concentrate on the strengths and opportunities and ignore the threats and weaknesses. You should have proof to support claims that you make in your projections. Show clearly what you intend to achieve, and how you will deliver outcomes.
 
DON’T ignore the competition
 
Business plans commonly assume that the competition will make no competitive response or indeed, will have no new initiatives of their own. Study your competitors and try to second-guess their plans. A ‘living’ document will take into account their actions.
 
DON’T forget to update your business plan
 
A business plan that is created for a purpose and then discarded will always become obsolete fast. Don’t make the mistake of abandoning or forgetting about your business plan after you’ve presented it to investors. The plan should adapt to changes in your company, its market and the economy – and that means regular reviewing and updating.
 
DON’T lose sight of the budget
 
All missions and strategies need money to succeed. A smart budget will help you to regularly review your expenses and make financially beneficial decisions. You may need to take a wide variety of factors into account when setting your budget. This is where we can help – why not give us a call?
 
DON’T forget to seek professional help
 
We can work alongside you to develop a plan that can help you to achieve your business goals. We offer advice on a wide range of issues, from raising finance to deciding on the most appropriate structure for the business.
 
Please contact us for further information. We would be delighted to assist you.