Often made mistakes

Not enough money

The most crucial reason why a new enterprise shut down is that business owner runs out of sufficient money. Cash flow proves quite critical to a start up business. You can get profit or close your doors if customers are making delay to pay you. Cash is the king for the startup venture and you must prepare for it. You should have capital for the investment of a business, or you have a support of bank or private investors. First you need to have money then start a business. You need to make a comprehensive planning about it. You should include the precise budget plan of your business; it will help you to make an informed decision before investment.

Not thinking survival

Starting a business is related to survival. If you want to get success in your business, you need to learn about market and trend of customers. At the start, it is useless to hope for a good profit as it will only help you to pay the bills. You need to make more planning to survive so that you can enough cash to support yourself.

Things to remember

Investors and lenders review hundreds of business plans in a day. You need to make your business plan stand out against the rest. You can do it easily if you avoid some common mistakes.

1. If you do not prove that you have management expertise to make it happen effectively, it may lead to failure. You can win the trust of people if you lend the credibility to your financial projections and ideas. If your management team is not strong, you need to join forces with a board of advisors.
2. Not clearly demonstrating from where you get revenue-what consumers pay you and for what they pay you. You should not be aggressive in setting revenue projections because it will undermine your creditability.
3. Not proving that your long term cost structure and business model is good to make a profit. How will you earn money from your business-what are your costs, what is your margin structure?
4. Not clear in your services or product description that helps reader to see the niche and need for this product. It may prove obvious to you but not to the readers because they are not educated in your business.
5. Not demonstrating that market opportunity is beneficial to get profit. What will be your business status in 5 years and how big is your market at present.
6. Not briefly explain about the interests of your competitors. Investors know that if there is no competition, they will not find a market for your offers. You need to describe your competition in a better way; it will help you to get dominating position in the market.
7. Not adequately acknowledging the interests of the target audience. You need to write this plan for the perspective of equity investors, banks and others.
8. Start with an unenthusiastic and boring executive summary. It is the first section that you need to make it enthusiastic and informative.
9. Poor presentation: If you have grammatical errors and typos in your business plans, the reader will think that the work you do in your tasks is sloppy too.
10. Saying too much: You should keep the plan to 30 pages with an executive summary of less than 3 pages. You can provide additional information if the investors will ask for it. These are some common mistakes that you should avoid for a successful business plan.