Q: Why should I write a business plan?
A: To increase your chances to operate a successful business.
A: To “tie down” multiple ideas that are racing around in your head. You will record information known to you. You may discover a need to obtain more information.
Q: What is one of the biggest mistakes most people make regarding a business plan?
A: They under estimate time required to pull details together in an organized fashion and tailor them to their business.
A: They never finish the plan, particularly the Cash Flow forecast area.
Q: What is another mistake neophytes make regarding a business plan?
A: They use free examples of business plans and use them almost exactly as found. Some people fail to make all the changes in the template, thus taking “their” plan to a lender with the wrong name, wrong financial numbers, paragraphs that are completely misleading.
A. They use software that is confusing.
Q: Why should I forecast a Cash Flow?
A. It is a prediction of whether there will be adequate money in the checkbook–if estimates materialize somewhat close to forecast.
Q. What if actual income or expenses differ from estimates?
A. At the end of every month compare actuals to forecasts. Variances are normal. Adjust focus and energy to compensate for variances. Adjust the forecast if deemed necessary.
Q. What are the worst mistakes someone can make when buying an existing business?
A. Over paying for obsolete, dirty inventory, worn out equipment or the entire business.
A. Believing sales figures before obtaining seller’s business tax returns early in negotiations.
Q. How can I find out how many people live in my County or State or Zip Code?
A. Go to www.census.gov.