Overall plan

• Be as concise and clear as possible, it is difficult to express ideas in a short amount of space. Often, however, plans are most easy to comprehend when they are short and simple. If a plan is too long, the reader may not read closely enough to absorb the information. Even though there is a 65 page limit to the narrative portion of your plan, don't use all of this room unless the plan requires it.
• Keep the plan to a logical and clear structure

  Suggestions:

  • Think through the basic goals and structure of the plan. Chart it out before the actual plan writing begins. The more clearly you see the big picture, the more clearly you will be able to describe it.
  • The Business Plan Elements section of the Northeast Ohio Business Plan Challenge 2005 web site can help you with the overall structure and placement of information. Refer to this section as you construct or edit your plan.
  • In addition to being a requirement for entry into the Northeast Ohio Business Plan Challenge 2005, a table of contents is essential in any business plan. It should be clear and specific enough to lead readers to the sections they will want to view.
• Make sure that spelling and grammar are correct.

  This may not seem like an important aspect of the plan, but your business plan is your main proof of credibility when the plan is the only information to which the reader has access. Poor spelling and grammar may convey inattention to detail. It may also make your plan, and you by association, appear unprofessional.

  Suggestions:

  • Use the spell check and grammar features in your word processing applications. Sometimes these tools identify items that are not incorrect, but overall, they pinpoint common writing mistakes.
  • Have a friend, colleague, or a staff member from a local business support organization in your area read your plan for these kinds of mistakes.
• Use language that is easy to read

  Suggestions:

  • Clear, easy to read language is ideal. Someone outside your industry should be able to understand it.
  • Get help to write the plan if you are not a good writer.
• Be consistent with the information in your plan

  As you write your business plan, the process may lead you to make changes to your business model, strategies, products, etc. Sections written earlier in the process may have information in them that no longer applies to the business or refers to something you have described differently in another section of the plan. These inconsistencies can detract from credibility of your plan and confuse your reader.

  Suggestions:

  • Leave yourself time at the end of the writing process to go over the plan for these inconsistencies.
  • Have an unbiased reader review the plan for these inconsistencies.
• Identify the weaknesses or challenges in your plan and address the means to counteract them

  It can seem the simplest solution to keep silent on the situations and circumstances that might jeopardize a business plan or model. This will invariably work to your disadvantage, however. A solid plan will leave very few questions left unanswered. Most judges, lenders, investors and other audiences for a business plan will see the holes and challenges quickly. If no solution or action plan is presented to deal with the challenges, the reader will make assumptions both about the prospects for the proposed plans and about the management team implementing them.

  Suggestions:

  • Address business challenges directly and state how you plan to counteract them. All businesses have challenges of some sort. It isn't necessarily a sign of weakness for the plan if these are identified. It is often in the handling of these issues that the strength of the plan and the qualifications of the management team are best illustrated. Don't avoid this opportunity to further the credibility of the business.
  • It is also a good idea to have someone else (who is preferably not a friend or family member) read the plan, to search for these holes and challenges. The business owner is often so close to the project that the plan will make assumptions or leaps in logic that make no sense to someone unfamiliar with the business. Having an unbiased reader take a look at the plan will ascertain if there is more work to do.
• Utilize appropriate data for your market research that comes from a credible source.

  Many business plans include rely on the results from very broad studies and demographics as the main proof that there is room in the market for the business or product in question. While this is information that may give background or describe the industry as a whole, this leaves the reader still asking many questions about the size and interest of the much smaller local or regional market that many small businesses are targeting.

  Suggestions:

  • If the business or products in question are not targeting a vast national market in the plan, be sure to look for demographics and target market presence in a much closer radius to where the company will do business.
  • If you're not sure what makes something a useful piece of information or you need more specialized information for your plan, you can hire a market research company to work with you or contact a business service organization in your area that will help you narrow down your search.

Organization

• Describe and prove the credibility of the management team

  The management team is one of the key elements to a business plan. The plan must convey the past experience and talents of the management team and its ability to deliver on the goals set by the plan. If this section is weak, the entire plan loses much of its credibility.

  Suggestions:

  • Evaluate the current management of the business. If gift or expertise are missing, it would probably be a good idea to identify this weakness and take steps to counteract it, either by working closely with an advisor to add the missing expertise to the business or by bringing someone into the business who has the qualities you need.
• Include outside advisors in the plan. Many of the judges stated that the perspective of an outside person on the business is crucial to the success of the endeavor. Identifying advisors and a board of directors or advisory board for the business increased their confidence that the business owner was getting the input needed to run the business.

Marketing

Back up all assumptions with data

Most readers of your business plan will recognize when assumptions and goals are too aggressive or unsubstantiated. Backing up assertions with applicable data from sources that fit the scale and scope of the target market leaves the reader with few unanswered questions and provides a strong foundation for the vision and goals of the plan.

Suggestions:

• Rely on your data to make the case for your idea and business model.
• If you can't find data or research to back up a statement or support the plan's assumptions, omit those assumptions or statements from the final plan. If the ideas can't hold up under scrutiny, they will erode the credibility of the plan.
• Clearly state how the business will distinguish itself from the competition

  The role of the business plan reviewer is to assess whether there is a place for the business or product in the marketplace and to determine the feasibility of reaching and appealing to that market. The more complete this section is, the more airtight the entire plan will be.

  Suggestions:

  • Market research is critical to this section. First, you need to research and describe your competitors in detail. Once you have made a case that there is room for your business in the marketplace, then describe how you will either fill a niche that is not currently being served, or how you plan to outperform the current competition in the marketplace. Strong market research will transform your assertions from theory into educated estimates.
  • In addition to describing your competition, it is important to provide a clear understanding of the products and services you provide and how you plan to position your products or business in the marketplace.

Finance

• Make sure the financial statements are properly completed

  Suggestions:

  • If you are unsure about the financial statements section, it would be a good idea to have them reviewed by an accountant or CPA before formally submitting the plan.
• Back up all assumptions with data.

  Most readers of your business plan will recognize when projections/forecasts are unrealistic or claims can't be substantiated. Backing up these assertions with data leaves the reader with few unanswered questions and provides a strong foundation for the vision and goals of the plan.

  Suggestions:

  • Provide rationale and backup for the data included in the financial statements. Don't assume that these are self-evident. You don't want to leave the reader with questions about how you arrived at figures.
  • If you can't find data or research to back up a statement or support the plan's assumptions, omit those assumptions or statements from the final plan. If the ideas can't hold up under scrutiny, they will erode the credibility of the plan.
• Breakeven needs to occur within a reasonable length of time.
  • A plan typically should show breakeven by the end of the first year in operation, if not sooner.
  • Evaluate your business model and assumptions to see if costs can be cut or revenue increased to shorten the timeline to less than three years.

If even after re-evaluation, the business model creates a sustained period of loss before breakeven, address this fact directly, explain why this is the case, and substantiate that explanation with facts.