Business Planning

Mistake 1: Incomplete financials
This is perhaps the most important section of any business plan. Lenders want to know when they will have their loans repaid and assess the risk. You need to produce financial statements that accountants will endorse without question.

Mistake 2: Over ambitious projections
Everyone thinks their business will grow exponentially in the first 12 months but in reality this is rarely the case. Your business plan must show a realistic path to profitability that proves your actual revenues and profits are comparable with your written plan.

Mistake 3: Leaving something out
Every business plan follows a certain structure. Lenders and professional readers generally look for 3 or 4 aspects of your plan. You need to ensure you have these elements correctly written in the right area of your business plan.

Mistake 4: Incorrect format
Your readers do not expect a 100 page tomb nor a 1 page overview. Getting this fundamental area wrong will show your readers just how inexperienced you are.

Mistake 5: Poor understanding of marketing
Communicating your products to your prospects is a critical success factor for every business owner. You need to show you understand your target customers, what their needs are, why they will buy from you and how you will communicate with them.

Mistake 6: An inability to sell your plan
Having an accountant prepare your plan may save you a headache, but it is you who needs to explain to your lender or investors every question they have about your plan. You need to understand everything that is written in your plan.

 

Developing an Internet Business Plan
If you are interested in developing a new business on the Internet or expanding your current business onto the global information superhighway, it is important to develop a business plan as part of your preparations. Like a regular business plan, your Internet business plan must give details of the proposed venture, along with expected needs and results. In addition, it must take into account the unique nature of electronic commerce.

Purpose of a Business Plan
A business plan is a proposal for a new venture. It is designed to convince the reader to support the proposed project. If the presenter of the plan is an entrepreneur, the plan's purpose is to raise capital for the project from investors. If the plan is being presented by an employee within a company, then the plan's purpose is to convince internal management to undertake the new project. This planning also has another purpose: to force the entrepreneur to do thorough and effective analysis.

Internet Business Issues
Electronic commerce on the Internet is relatively new and poses many unique challenges. First, most people do not know exactly what the Internet is or what it can offer businesses. This is a hurdle that must be overcome in your business plan. Second, resources that are taken for granted in the real world often do not exist or are in formative stages in the on-line world. For example, payment systems, ad page pricing, and market demographic tracking are all in various stages of development on-line. Third, the pace on the Internet is dizzying. Keeping track of the rapidly changing trends, technology, and competitors is crucial to the success of your business.

 

Sections of an Internet Business Plan

    • Customers
    • Competitors
    • Advertising
    • Pricing
    • Delivery & Payment