Business Plan Tips

Creating a proper business plan, which can be used for guidance, can be the difference between succeeding and failing in the industry. After watching several videos by John Powers, attorney at law, and Dan Nathanson, School of business UCLA, there are several important factors that they mention when creating a business plan.

 First mentioned by John Powers the inadequate capitalization to start a business is usually the most uncalculated part of the business plan. It is crucial to be very accurate and precise to not overlook anything when putting the numbers together on the plan. The most common mistake is to underestimate the cost of operation for the sake of spending less, and making the plan look better financially. This may look good on paper but in realty drives the business into the ground. Since the business plan can be a guide for time to come, starting up your business with wrong numbers is like talking a boat into the ocean with holes in it. The business is bound to sink before it has ever opened.

Dan Nathanson mentions another common mistake made when creating a business plan is to keep to much secrecy. Entrepreneurs think they all have the billion-dollar idea and do not want to share the full extent of their idea. When creating a plan that involve many people, it is crucial to be honest so no detail is overlooked. Keeping important information to secret means it is overlooked in the books and not accounted for in the financials. If the entrepreneur shared the idea, they could not only get the correct financial for it, but get feedback as well. Individuals in the field that have experience can help with the idea and may see areas that have been overlooked before. It’s the small secrets of a corporation that can ultimately lead to the failure of a big business.