In the simplest form, business plan is a road map — a guide for a business that outline the goals and details about how you plan will achieve those business goals.
There are many constituents of a business and when they come together in a planned and appropriate way makes a good business plan. Often time, patience and many revisions are needed to get a right business plan. But sometimes, in rush to get funds or in hurry to launch a new product, business owners deviate from the plan they originally prepared or even forget it totally or come up with a faulty plan, just to accomplish a short term goal. This can result in a down in business or failure to achieve the goal. Hence business plan is more important than the business itself. A well thought plan not only increases the efficiency of all the processes involved but also helps in achieving the desired profit and success. A flaw in business plan not only increases the cost involved but also delays and decreases the profit.
Every investor who is looking to invest in the business will be keen to know everything with regard to the company, about the owner, income stability, repayment capacity, company staff strength, client references and more. Apart from these, investor will also look into what type of product or services is rendered through the business. Unless there is clear information and the purpose of business is legal and legit, no investor will invest in the business. Hence it would be good to review your business plan one more time, find and fix the flaws in it.
Below are the Flaws in your Business Plan that you need to Fix Now
Unrealistic Financial Projections
Many of the business owner overestimate the value and worth of their business in the business plan. This thing can backfire as the investors or the moneylenders who are investing in the business are highly expert in their field and can easily estimate the business worth and future earning potential. In such a case your plan or project can be rejected for sure. So be realistic and accurate with each and everything!
Bad and Incomplete Research
Market research is the most important thing to do when you start a business or before launching a new product. The whole business depends on this research as you plan and do everything in your business according to this research so that you can satisfy the customers and be able to stand in the market. So there should be no chance for a bad or incomplete research. A bad or incomplete research can lead to a major fail in your business.
No Attention/Focus on Your Competitors
This is the point where most of the businesses fail. Overconfidence is a very bad thing which leads to major failure. So don’t be over confident and always check your competitors for their products and pricing. Even if you think your product is unique and have more features than others then also it is required to check and compare then start or launch any new product. This will surely help you to grow your business.
The Plan made on Unfounded or Unrealistic Assumptions
Most of the business plans are full of assumptions. Of all the most important assumption, is your business will succeed! A good business plans highlight critical assumptions too and provide a sort of rationalization. A bad business plan buries such assumptions throughout a complete plan. Market size, pricing, customer behaviour, time of commercialization—all these things involve assumptions. Wherever possible try to make some assumptions against benchmark. So that you can be prepared for some downs as well in your business. Always try to tie your business assumptions to facts.
The Claim that NO RISK is involved in Your New Business/Product
When you do anything new ‘Risk’ is always there. No decision can be taken without any risk, and no business is risk free. But the thing you can do is to try to minimise the risks involved in your business. Plan your business in such a way that it have limited and few risks. If you are presenting your business plan to the investors try to minimise the risk taking decisions in that. But in reality never neglect them. It may happen that by seeing too many risks in your business your business plan gets rejected. But this doesn’t mean that you should complete eliminate risks and claim that no risk is involved in your business. This is completely unrealistic.
An Incomplete Business Plan
A business is formed not by a single element. There are so many elements, when they comes together forms a business. Those elements are- product, services, staffs, sales, marketing and management. Including all these elements in a business plan can help you to grow your business. Not even a single element should be left behind in your business plan. Plan for each and every element and work according to your plan.
Lack of Opinion for Your Business Plan
When you make a business plan it’s very important to show your business plan to the professionals to have an expert advice, so that if you are lacking anywhere you can cover it up before showing it to your investors. Most importantly it is always a good thing to be double sure about any of your action or plan.
Including too Detailed Information
No one is interested in reading any detailed thing. Suppose you write your business plan in 150 pages. Will that be interesting for anyone to read including the investors? Be clear cut and include only bullet points. The details are known to you. Remember action speaks louder than words. So the results not the detailed words.
Hiding your weaknesses
There can be many weaknesses in your business. Don’t include all off them. This will make your business plan weak. Include some along with the ways by which you will tackle with them. This will attract investors.
Poorly Written Plan
The business plan written should be written in a good English without spelling and grammatical error. So that when the investors read they find it attractive and catchy. No one would want to invest in a company or plan whose Basic English is poor. This can be considered as a weak point for your business. As in business you have to deal with many clients and partners. It you are not able to communicate with them properly your business plan is of no use.