When to Write a Business Plan:
You should write a business plan six to twelve months after deciding to start a business. Writing a plan in this timeframe increases the probability of success by 8%.
Who Needs a Business Plan:
You need one if approaching financial institutions for a loan, applying for grants, pitching to investors, or bringing on partners.
Reasons Not to Write a Business Plan:
- Investors buy into you and the business, not the plan.
- Writing one takes time and money.
- Market research techniques can be unreliable.
- Testing assumptions in the real world is better.
- Build momentum by getting started.
- Plans make unrealistic assumptions.
- Carry out reality checks and make appropriate plans.
Common Pitfalls in Business Planning:
Plans waste time by moving numbers around a spreadsheet. It’s important to understand that businesses fail from lack of short and long-term planning.
Some plans demonstrate that businesses should not start, but entrepreneurs may be reluctant to confront that reality.
Challenges with Business Plan Consultants:
Unfortunately, "business plan consultants" often use templates and promise quick results with minimal effort, not providing true value. Be cautious when deciding on consultants.