For competitors in business plan competitions, the business plan is the foundational piece that spells eventual success or failure in the competition. Regardless of how well you present yourself or how many connections you have, if your business plan isn’t cogent, thorough and articulate, odds are you won’t win or even place.
One of the biggest inconsistencies in business plans is the gulf between the financial sections and the narrative sections, says Jerry Pradier, a business coach and author of Financial Success: Ten Shortcuts to a Profitable Business. “The numbers in the financial section have to support the narrative,” he adds. “Investors will check to see if they match up, making sure areas like the development plan have enough financial resources allocated to them. You have to be realistic with the numbers and reconcile them to the narrative.”
Potential investors and good critics of business plans will challenge every assumption the plan makes, notes Terry Murray, founder of Performance Transformation, LLC. “Before you finish your plan, ask yourself serious questions about all of your assumptions,” he says. “Make sure you include the data points that are going to substantiate your position. If they don’t, open up your thinking, do more research and explore possibilities that might not have occurred to you.”
A business plan tells the story of the company you plan to start, articulating the business’ goals and objectives in a measurable, tangible way. By tying those goals to the present, entrepreneurs keep the plan and themselves grounded. The process of writing a business plan creates a road map to implementing those goals in the months and years following the opening of the business, Murray says.
Pradier sees the goals section as the hardest part of the plan to write and present because there are so many potential variables involved in growing a business once it’s started. “The goals need to be authentic and reasonable,” he asserts. “You need to think about the smaller steps that it will take to meet the larger goals and make sure that they have the characteristics of being measurable and observable. Each goal should be assigned to be the responsibility of one staff member.
Many business plans fail just because of the lack of “chunking” goals down into smaller more manageable steps, Pradier believes.
Finally, testing your business plan’s assumptions through some type of prototyping or market testing will either validate your assumptions or send you back to the drawing board, says Murray. “It will help you incorporate real world lessons and validate the intuitive leap that brought you to create the business plan if you do it with discipline and honesty. You have to be flexible and willing to change your plan if you need to.”
There are many great resources available if you need assistance writing your business plan. One step is to check with your local economic development agency to find out about programs that they may offer. If a business plan competition is being held in your area, check there for resources as well. Many times competitions host workshops or mentoring sessions that are open to the public in addition to competitors.
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