Writing business plans is hard. And the difference between a good business plan and a great business plan can be small details.
How do you make your business plan even better? How do you find just a little more oomph after you’ve put in all the work time and attention to make a good business plan?
Based on the thousands of business plans I’ve seen and worked on let me give you some ideas of what can be included in your business plan to really take it to the next level. These are five of the most common areas where I find businesses can step things up and really make an impact.
1. Your Revenue Story
Your revenue story is one area where you can really take things to the next level. And note that I intentionally use the word “story.” In a perfect world there should be story behind why the revenues coming in and why people should be doing business with you. (It’s worth noting that is important you have revenues and not a story of how you will have revenues in today’s market.)
Most investors are interested in the upside of your business. And the upside come from revenue and bringing money in. The most businesses have a story about why their product or service is needed in the market and how revenue will be achieved now and in the future. What can you do to add a little more to that?
How can you make revenue exciting and interesting. How can you create intrigue? How can you make sure the investors really want to keep doing business with you?
If you want to intrigue investors and partners you really need to step it up to the next level. Tell them why your story is so compelling. And tie your revenue story to the future of the business world. Not just where things are today, but where the market is evolving to. How will you be a key player in the future as things evolve?
2. Enhance Your Management Team’s Profiles
Most investors will tell you they’re not investing in the business plan as much as they’re investing in the management team. Why is this? It’s because the business is likely going to evolve over time.
Savvy investors know that the business plan they see today may not be the business plan that makes the big money. Everybody changes their business plan over time. Especially if they’re going to grow and succeed in today’s market. Look at a huge company like IBM or Google. These businesses started out in one field of endeavor and now are in many more. The business today looks nothing like the business of the past.
And for the growing company this is especially true. Many companies in abandon entire markets and find new markets that allow them to grow. But this doesn’t just magically happen. How does a company evolve, or pivot as the common term is, to capitalize on growth?
It’s the management team. They are the key. The management team has to move the company from one focus to another like the director of an orchestra. They have to make the smart decisions based on customer feedback, market conditions and the resources of the company.
Smart investors know this and that’s why they focus so much on the management team. So what can you do to tell your management team’s story better?
When you’re upgrading your business plan significant time and attention into your management team. Focus a lot on who they are and what they do and what they should be doing. That will help you elevate to the next level.
Explain all the relevant skills, experience and decision-making abilities of your management team. Show their successes and failures. But mostly show that they have the capability and experience to make good decisions. Those reviewing your business plans will appreciate it.
3. Have Answers For Risks
I start with the assumption that you have indeed disclosed risks of your business in your business plan. Hopefully your attorney or somebody else has told you that is critical that you explain risks within your business plan. Taking risks out of your business plan will raise many red flags.
But for the risks you do have in your plan you want to have answers. This doesn’t mean overly explaining them away within your business plan, but rather acknowledging the risk and that you’ve come to a reasonable solution to handle the risk. No risk, in the real world, can be completely managed. See you want to show that you’re making a good attempt and that you’re putting reasonable efforts to manage and control risk.
4. Uncover The Truth
Many people try to hide facts or details in their business plan. They’re hoping that investors will miss it. This might be a hidden risk, a competitor that they don’t want the investors (or others reviewing the business plan) to know about, or weaknesses that they want to sweep under the rug.
When you’re writing your business plan you want to uncover the truth. Make sure the truth takes front and center in your plan. Show that you’re being honest.
Many investors, bankers and others that were viewing your business plan want to know that you’re telling the truth. Think of the business plan is the start of your relationship. You want to put your best foot forward, just like in dating, but you also want to show who you are. You don’t want unmet expectations in the future.
Spend time in your business plan making sure that the truth is disclosed. And make it look like you know what you’re doing and that you can face the truth. While it’s tempting to shade the truth or hide facts being forthright will pay huge dividends in the long-term.
5. Different Things For Different Eyes
Throughout this article we talked about your business plan generically. One of the keys to having a good business plan that helps you accomplish your goals, whether that’s getting that customer, bringing in an investor or getting a bank loan, is to understand your audience.
You may need to have different business plans, or at least different versions of your business plans, for different audiences and different context. Typically with an investor you’ll go through multiple layers of discussion. One discussion will be general, one will be more detailed and then finally they’ll look at the extended business plan (the exact stages vary but it’s always general to detail).
Be open to creating different business plans for different contexts and situations. Match the level of detail to the reviewers needs.
Writing business plans is a lot of work. But the difference between a good business plan and a great business plan is often small. I think you’ll find the five items in this article are very helpful for you stepping from one level to the next. Use them to your advantage.
Do you really want to make plans that work?
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