Your Business Plan is Fiction

Don’t get me wrong; a business plan is a useful tool. We write them for two reasons. Reason 1: It helps us as small business owners assess risk on paper so we can make an informed decision about the viability of the business. Reason 2:  Financial institutions want it to assess how risky you are as a potential borrower. A business plan is fiction. It is a fabrication; a story of what could be. I often hear entrepreneurs say when pitching a business plan, “Our numbers are very conservative”. No, your numbers are not conservative. They are fiction. They have not happened yet. It is all “Pie in the Sky” thinking. By its nature, a business plan is optimistic. No one ever comes into to the bank with a business plan that shows how the business fails in nine months.  Once you commence operations, all bets are off. Your business is in a constant state of flux. Customers, marketplace, and technology are continuously evolving. Your business plan needs to be continuously updated to reflect the changing business environment.

Here are some resources to help you draft your business plan:
SBA: How to Write a Business Plan
NSBDC's: Business Plans made Simple
SCORE's: Business Planning Templates and Tools
Seth Godin's: The Modern Business Plan
The Funding Roadmap: The Business Plan Reinvented