As first seen in the Coffs Coast Advocate
Failing to plan is planning to fail. So hopefully you are planning to plan. If so, be sure to avoid these common business-planning mistakes.
Not writing it down
You don’t necessarily need a full-scale, professional-looking version. But you do need to have a considered and written plan. Without it your business risks becoming unfocused, missing opportunities or chasing bad ideas.
Getting stuck in the detail too early
Before you start playing with your favourite ideas, get clear about the bigger picture. Where is it you want your business to head? What value are you offering to your customers? Why are you in business in the first place?
Once you identify what your business stands for and where you want it to go, you can start evaluating all those brilliant ideas. With your newfound clarity, you may discover that some of those ideas are not quite as clever as you thought.
Only planning when you need finance
It’s obvious to most that a business plan will be required when you are looking for a bank loan or to attract investors. But don’t let that be the only reason you write a plan.
Planning for the business (not the bank) is important regardless of your financial position. You don’t need fancy words and charts. You do need to take into consideration your current situation and future ambitions and then map out the actions you will take to get you where you want to go.
Sticking your head in the sand will never result in a useful business plan. A plan is not a wish list. Face up to your business weaknesses. Get real about the threats that could be around the corner. It’s great to aim high but don’t set objectives that are nigh on impossible to achieve.
Not ensuring the plan is affordable
Many small business owners are more comfortable with ideas than with numbers. Unfortunately a plan doesn’t have much value if you don’t work out how you’re going to fund it. The great thing about planning is it lets you see early on what will and won’t work financially.
If you aren’t sure how to set a budget to reflect your plan ask your accountant for help.
Never looking at your plan after it’s written
There are two really important reasons why you want to look at your business plan every single day. The first reason is that it will be a constant reminder of where you are going and the important things you want to achieve. When you need to make flash decision or you are up to ears in small administrative tasks, it’s important to be reminded why you are here.
The second reason to keep looking at your plan is because things change. Your plan needs to keep changing to reflect this. Make sure you review your plan monthly or (at least) quarterly and tweak and modify to stay on course.
Writing a business plan does not need to be difficult. We have developed a template kit and “how to” videos that will help you to write a plan on one A4 piece of paper. Go to www.mjabusiness.com.au/business-planner to download these for free.