Between December 2010 and January 2011 a small survey (see below for details) was conducted that shows there are indeed some things that writers of business plans should bear in mind when considering how their business plans will be read.
So, thinking how people READ business plans will lead you to WRITE a better business plan of your own.
Findings in brief:
- Most people start with the executive summary, and will abandon or read the rest of the business plan depending on what they think of it – so make sure your executive summary is perfect: not good enough, try and make it shine!
- By far the most annoying thing to find in a business plan is: lack of research – so, do your research! don’t write stuff you can’t back up!
- The most pleasing things to find in a business plan are: clear objectives – clarity in the business plan was something that readers mentioned again and again – make sure your plan hangs together really well.
Question 1: In what capacity do you usually read business plans?
Is this a fairly representative selection of people who read business plans? My feeling is that, in the UK, it is.
Question 2: As a rough estimate, how many business plans do you come across per year?
Because of answers to Question 1, it seems logical that a fairly low number of business plans per year would be read by most people.
Question 3: Do you read every bit of every business plan you get – or do you tend to try out sections before deciding whether to read the whole business plan in its entirety?
Frankly, I am surprised there are so many people who would continue reading a business plan no matter how poor the beginning!
Question 4: How do you usually start to read a business plan?
Again slightly surprised at this as I know people who start business plans at the financial section or even the CVs…
Question 5: What are the things that annoy you in a business plan?
These results show that it is hard work, attention to detail and checking things out in the real world that makes the difference.
Question 6:What are the things that please you most in a business plan?
These answers show that clear thinking, doing your ‘homework’ and clear presentation is what counts.
Question 7: What advice would you give to authors of business plans?
| Thorough research of market with evidenced logical conclusions directly correlated to clearly stated objectives.
Research market, competitors, pricing & profit margins. Net profit potential. Break even point. know why you’re writing it before you start (see previous article on mine endorsed by ISBE on why there are only 3 reasons you should write a business plan) |
| Not too much detail – clear headers and answers to key areas such as the market and financials |
| Ensure you get good advice and research what is required to produce the best working document possible to give your business the best chance possible, then to review and update regularly |
| Keep them brief & to the point. It’s only a signpost & will probably change as soon as you start trading. |
| Simple. Concise. Clear. Confident. Do the research, get the evidence, be realistic
Keep it succinct. Assume your audience knows nothing about you. Use plain English. Think about your vision – is it compelling? Your exec summary is critical – get you key points in early. Present it well – use consistent fonts, spacing, bullets, etc. Use pictures/diagrams, etc. Use ambitious but not overly optimistic targets/projections. Put something in about the people behind the business – biographies, etc. Say what you are actually doing! |
| Go with it with the end in mind first, then do the market assessment. |
| Have a format and be succinct. |
| View the document as a changing document that should be referred to regularly to measure development and progress plus to remind one of the original objectives; did they change? were they appropriate? In short keep reflecting on the business plan |
| Make it simpler and clearer, + backed up with evidence. |
| Be very clear what the business plan is for and think like your reader |
Once again what comes through is that hard work, lots of preparation, and above all clarity are what is needed to produce a good business plan.
Details of the Survey
Between December 2010 and January 2011 Dave Kilroy of Business Plan Writer (http://businessplanwriter.co.uk) conducted an online survey which was completed by 18 respondents.
- All questions were answered by all 18 respondents with the exception of Questions 4, 5 and 6 – where 1 person skipped these Questions and Question 7 where 4 people did not leave an answer.
- Over half of the people doing the survey read between 1 and 5 business plans a year.
- There was a broad range of stated reasons for reading business plans, the most common category, at 1/4 of respondents, being business advisors, although one person read between 50 and 99 business plans in a year.
- Bearing in mind this profile it is therefore possible to say that this group of business plan readers is a not unreasonable sample of business plan readers – and as such, what comes out of the survey can be given some weight.
Please get in touch with Dave Kilroy at Business Plan Writer directly for more details.
On-going research
I am thinking of creating a new version of the survey – do you have any thoughts on changes for a new version?
Your comments
Do the above answers chime in with what you think? Have we missed anything out or made any mistakes? Please let us know by leaving a comment.