Preparing an effective business plan is important for primarily two reasons; 1) it will help guide the business and 2) it is essential to obtaining funding whether you are financing a start-up or early stage business or a mature one that is expanding.

It is no secret that most business plans are written to secure funding. Unfortunately, too many business plans are poorly written, they do not include enough information and data to instill confidence in those who will be making important funding decisions, and/or they fail to address the most important issues. Many business plans are rejected by funding sources because they do not provide adequate and relevant information or data about the business.

In a nutshell, a well written and comprehensive business plan with solid assumptions and realistic projections will get the attention of the reader as long as the underlying business concept is sound. Too many sound business concepts get torpedoed by a poorly constructed or incomplete business plan.

A business plan is usually the first opportunity to impress funding sources. It is much like a resume. If a resume is poorly written or poorly constructed, it generally is thrown out. Business plans are very similar. Impress the reader and there is a good chance of getting to the next step. Disappoint the reader and getting to the next step is unlikely.

A business plan illustrates for the reader the extent to which the writer has done his or her homework. Most business plans fail to convey clearly what it is the business will do and how it will do it. Another major failure of business plans is the presentation of unrealistic financial projections.

It is sad to see people spend numerous hours preparing a business plan only to end up with a product that stands little chance of conveying the proper image and professionalism needed to be successful. One of the major culprits in this problem is the internet. While there are some decent resources available on the internet for preparing business plans, there are far more that mislead people. Too many Web sites provide samples of business plans that are sketchy and incomplete.

A business plan is not a ten page book report. It is a presentation of your business concept, management, marketing, operations, financial projections and numerous other important facets of your business. It is important to avoid being misled into thinking that a summary of your business and a brief overview of financial information is adequate.

Another trap that some fall into is purchasing ready made business plans for a particular type of business. It is far better if you write your business plan from scratch. Why? There are two key reasons. One of those reasons is simply because you will better understand what is being written and be able to respond to difficult questions about your plan and your business. Another reason relates to a potential mismatch of what has been written to your specific business concept.

A boiler plate business plan will not likely match the specifics of your business. So, in the end, you will be forced to write the plan essentially from scratch anyway. Another important point is that most astute readers will recognize a plan that is mass marketed. Make the plan your plan. If you want to create an impressive business plan, write it from scratch. Certainly, some of the sample plans available can be helpful. But avoid relying on them too much.

There are certain elements that all good business plans contain. Based on years of experience in writing, reviewing and assessing business plans, we have developed a comprehensive and straightforward workbook that will guide you through the entire process of developing a sound business plan. Click here for more information

Disclaimer: The information above is for informational and educational purposes only. It does not construe advice. Your use of the information is at your discretion and you assume the sole responsibility of relying on this information at your own risk.