5 Tips for a Great Business Plan
5 Tips for a Great Business Plan
Patrick Hull ,
I write about entrepreneurism: the good, the bad & everything else.
Opinions expressed by Forbes Contributors are their own.
Last week, I discussed the components of a strong business plan and why entrepreneurs should create them, regardless of their venture.
I’ve had experience both developing business plans and reviewing them for potential investments. Although an idea is what often gets investors interested, a business plan is definitely needed to get financial support from them.
The simple act of writing down your idea and outlining how the business will operate can be helpful to ensure that you communicate your vision and that everyone is on the same page. It also helps you benchmark and check your progress as the company grows.
A business plan is crucial to get support for your vision because it shows that you have thought through an idea clearly and aren’t just winging it.
For example, I once wrote an entire business plan with a business partner on paper towels. We recognized an opportunity, but had to write it down and test the idea to make sure it would work (we didn’t have any paper handy, although that didn’t stop us). The plan was just for us, but we still had had to see if the vision, the financials, and the strategy were sound. We created that company and it went on to gross millions of dollars a month. In other words, your business plan doesn’t have to be some manicured document in order to make it successful.
Now with this example keep in mind that I didn’t need to raise capital for this company and I had existing expertise in this industry. I’m certainly not advocating people draft business plans on paper towels! However, even with capital and expertise, it was still important to write out our idea and create a business plan. Otherwise, the company could have lacked direction and structure.
Your business plan should be clear and provide a roadmap for your company. Without a plan, you’ll find it more difficult to communicate your vision and see a path to growth.
Here are five other business plan writing tips I’ve found useful during my career:
- Get rid of the fluff: You should always be as concise as possible and remove any filler language. Even if it sounds nice, fluff gets you nowhere and wastes space. Plus, no investors want to read a long business plan. Get to the point quickly.
- Be realistic: You should be honest with yourself in your business plan, which is why it’s important to consider challenges and opportunities. If you’ve got a strong idea, let it stand on its merit.
- Show you’re conservative: Everyone says they’re “conservative” in their business plans, but most aren’t. You should be. Use examples to demonstrate that you’re conservative in your approach and projections.
- Visuals are good: Whenever possible, and without overdoing it, use visuals in your business plan. Graphs, charts, and images can help bring your concept to life. Plus, it breaks up the text and helps a plan flow better.
- Be creative: Include a creative element in your business plan so you stand out and grab someone’s attention. You can use templates, but don’t look identical to a template. Do something unique to make the plan yours.
If you need help writing a business plan (the financial information can be complicated), here’s a guide from SCORE, a nonprofit association that helps entrepreneurs and small business owners, to a number of business plan templates.