5 Common Reasons Why Business Plans Fail

There are obvious reasons why business plans fail -- missing crucial deadlines for finishing the business plan or drawing unattractive profit projections are just some of those instances that may repel potential investors. On the lighter side, there are also those more subtle reasons that investors and banks lose interest to. By learning these tips, you can avoid the often overlooked mistakes some people usually make when writing a business plan.

1.    Bad business idea

Nobody likes to talk about it, but the main reason why business plans fail is bad ideas. Most ideas look great on paper—but all too often, companies realize they have invested in a bad idea once it is too late.

To avoid this, smart businesses are using “user-driven development” (UDD) to build new businesses. Lots of ideas seem great until you figure out that the market doesn’t actually want your product. In order to ensure that a business idea is sound, entrepreneurs should search for product validation by reaching out to their target consumers before sinking huge amounts of time and money into the project.

Firms that want to innovate with a focus on customers often hold small meetings with the potential end users where they describe the project and then ask users for their opinions. After the first round of discussion, the firm can go back to the drawing board to incorporate the helpful feedback. Second and even third rounds can enhance the final product’s popularity.

Avoid wasting time on a bad business plan by gauging the market sentiment toward your project before investing a significant amount of time and effort.

2.    Employee compensation is not incentive compatible

Business plans can fail because employees are not compensated in a way that aligns the goal of the employee with the goals of the company. For example, if an employee is paid with annual or monthly bonuses then the employee will only do what is good for the company in the short run. Startups and small businesses can offer more customized salary packages than large multinational corporations.

For example, instead of offering a standard salary package of retirement plans, child-care assistance, savings program, determine what the employee wants the most. For example, elderly employees may not be motivated by child-care assistance, so don’t focus on that in their package. Secondly, instead of offering an upfront payment of 2 percent of the company’s stock, offer a salary that pays that 2 percent over several years to ensure that the employee stays committed in the long-run.

3.    Un-balanced team

Another common cause why business plans didn't work out is that the team is not balanced. Say for example a tech business plan that was making a health application for smartphones. The problem is, the team did not have a single developer or IT specialist involved. If the business idea requires 80 percent of the labor hours to be performed by a software programmer, then the team needs at least one developer onboard. It is important to keep in mind that venture capitalists sometimes refuse to fund companies that only have one founder or have unbalanced teams.

4.    Missing financial projection details

The “numbers” are actually the most interesting part of the entire document for most investors. Break-even and return-on-investment (ROI) calculations are also parts of a good business plan. Do not forget to factor in future expenses. For example, if the company needs to purchase new office equipment every three years, then the discounted value of those expenses should be included in the forecasted financial projections. Of course, the figures are only estimates, but they are important benchmarks that can be used to measure the company’s progress toward achieving their goals.

5.    Failure to improve business plan after receiving feedback

Once you have finished writing your business plan, it is a good idea to send it out to at least three people before showing it to potential investors.

Think of these three people as your board of advisors. Ask them to read the plan and look for logical gaps in the content. If one advisor recommends a change that you disagree with, do not ignore his advice. Instead, ask the other advisors for their opinions and then make a decision. Edit your plan according to their constructive criticism, and thank them for their help.

Need Some Motivation to Your Entrepreneurial Confidence Check Out These Ways

Confidence usually comes easy with people who had a taste of success in their lives. This is true because they believe in themselves, as well as in what they're doing. However, it isn't their success that makes them confident; the confidence was there beforehand.

Confidence is a crucial building block in a successful career, and embracing it fully will take you places you never thought possible. With proper guidance and hard work, anyone can become more confident. Once you pass a certain point, you’ll feel it from the inside.

When it comes to entrepreneurship, you need to possess qualities that will give you faith in your own decisions and actions to execute on your ideas. Read on the strategies below to help you give that boost you need.

1.     Embrace worst case scenarios

How bad could it be? Lack of confidence is often a fear of failure. Overcoming it starts with figuring out what the problem is. Identifying the possible negative consequences of our decisions and entrepreneurial initiatives and then naming their potential solutions reduces uncertainty and increases confidence.

As an entrepreneur, leveraging the available collegiate resources such as professors’ advice, library, connections, and things as little as a printer to pursue a startup venture was a great extracurricular activity instead of looking for an internship or part-time job while at school.

It will not only help you figure out what it really meant to build a business, but also to build a stronger resume in case you decide to look for a job in the future. Even though you did not seek for a job after college, building a business while in college certainly helped many of your classmates on that front.

Things that might lead to the worst-case scenario: not earning a degree, not finding a job, retaking classes, regret, and so on, turned out to be a competitive advantage over other students who focused entirely and solely on studies.

Spend time thinking about the worst that can happen. It’ll help you be more at ease when you start your entrepreneurial endeavor because you’ll have thought your decisions through completely.

2.     Keep a cash cow: Your monthly revenue goal

Successful entrepreneurs maintain multiple streams of income—something easier said than done. Specify how much revenue you need to be generating from your startup for you to let go of other responsibilities (such as a part or full-time job) to be able to focus entirely on your new business. Is it $2000, $3000, five, six, or seven clients per month? Identify the magic number.

Setting a benchmark will help you quantify milestones so you’ll know when you get there, but most importantly, it’ll help you clear all doubts by proactively accounting for all your financial concerns about transitioning to running your new venture full time.

Confidence is gained incrementally, and it’s the small successes that take us from one increment to the next. So, quantify progress by highlighting the small accomplishments on your way up to the bigger ones.

3.     Keep mentors in the loop

From every business dimension, the best mentors have been shown to make a significant impact in entrepreneurial success whether by boosting new business initiatives, increasing revenue, funding, acquisitions, partnerships, and more.

When Steve Jobs was 12 years of age, he called the co-founder of Hewlett Packard, Bill, to ask for spare parts to build a frequency counter. Bill offered him an internship that summer. Jobs says, “Most people never pick up the phone and call, most people never ask. And that’s what separates, sometimes, the people that do things from the people that just dream about them.”

4.     Launch -- Don't wait for perfection

Groupon, the second fastest company to ever reach a billion dollars in valuation, started with a WordPress blog. During a design conference, Airbnb founders saw a need for lodging when all the hotels in the city were booked so they approached attendees for bed and breakfast.

A product is never perfect so we might as well start with nothing. Start selling as soon as you find a need, and don’t hesitate to get paid for a mediocre or even a simulated product (like Groupon) in the beginning. Starting with an MVP (minimum viable product), one that only includes the core version of the product, can help you go to market quicker, test faster and evaluate the potential of the idea without investing a lot of capital.

Validating the need for your product as early as possible removes a lot of the guesswork and consequently boosts your confidence about the potential of the idea.

5.     Learn continuously

More specifically, learn what's relevant. Start by identifying the areas you need to learn more about and then focus on reading or watching videos from two to three of the top experts in your industry. Keep in mind that the most educated are not necessarily the best people to learn from. Those who got their hands dirty and lived the ups and downs of running, failing, scaling, and successfully building a business can offer better advice.

It is true that most business decisions cannot wait weeks or even days, however, investing as little as a couple of minutes to read a book chapter, articles or even attend an online course or lecture, can tremendously improve decision making, boost confidence and most importantly, make sense of the acquired knowledge.

Ultimately, entrepreneurial confidence is about making calculated choices and being proactive about reducing risk. Remember that taking small steps—finding a mentor, launching an MVP, or reading a book on innovation in your industry—can have a big impact over time.

4 Signs Your Business Isn't Working Anymore and What You Can Do to Resolve It

No entrepreneur would want to admit it, but sometimes the way we run our business isn't working as well as it could. We all get into certain habits when it comes to doing business, but sometimes there are better methods of doing things that we aren't using in order to make our business grow.

So, here are four signs that your business isn't working anymore, as well as some tips on what you should do to fix it.

You're Disorganized

You’ve probably heard a million and one tips about how important organization is to success. There’s a reason that self-help gurus and business advisers stress the importance of being organized. We can’t work to our maximum abilities if our offices are in chaos and our days have no structured routine to them.

If you’re functioning in a state of disorganization but feel like your business is still thriving, just imagine how much better everything would be if you weren’t constantly searching for a lost document or trying to remember who you were supposed to call back.

If your workday and your office are chaotic, it’s time to finally get them under control once and for all. Commit yourself to creating a daily schedule and trying to follow it as much as possible. Get your office clean and organized and then devote ten minutes each day to ensuring that it stays that way. You’ll be amazed at how much more productive and motivated you are each day when you’re no longer surrounded by disorganization, chaos and disarray.

Your Data Storage System is Outdated

In the early days of tech, people still associated storing data with physical storage. Instead of storing paper documents, people stored data in physical hard drives and servers. While this system served many companies just fine for many years, the way we store data has changed. Physical data storage no longer makes the same sense that it used to. After all, in the event of a fire or robbery, that data is gone forever.

If you haven’t moved to cloud storage, it’s time to finally make that move. While many entrepreneurs worry that cloud storage is less reliable than physical storage, this simply isn’t true. After all, cloud storage can’t be harmed by theft or catastrophe the way that physical storage can. If you have no idea how to develop a cloud storage system, consult a cloud storage consulting service.

You're Procrastinating

This is closely tied to disorganization when it comes to behaviors that hurt your business even more than you may realize. When you’re constantly putting things off, you’re not working to advance your business. Instead, you’re just constantly trying to catch up on the things that you failed to accomplish the week before. Constantly feeling buried under the weight of overdue work is no way to run a business, nor is it any way to live your life.

If you’re ready to finally climb out from underneath the crushing weight of procrastination, don’t be surprised if it takes some time to develop better habits. Once we get into the habit of doing things a certain way, it can be difficult to unlearn these behaviors. Just commit yourself to improving how much work you complete in a day. Anytime you get the urge to procrastinate, just remind yourself of how miserable you feel when you wake up the next day and realize that you didn’t accomplish all of your goals from the day before.

Your Passion Isn't There Anymore

When people first start their businesses, they’re overwhelmed with feelings of passion and excitement. As the days turn into months and weeks, it’s easy to lose that feeling.

You should always feel passionate about your company. Otherwise, you might lose the motivation to truly make it great. Every morning, take some time to remind yourself of how lucky you are to be an entrepreneur and remember why you started your business in the first place.

If you’ve fallen prey to any of these four bad behaviors, then it’s time to make some positive changes. As an entrepreneur, you should always be committed to improvement.

Tips on How to Transform Your Ordinary Website to a Huge Success

Have you recently built a website for your art, music or business? Congratulations, you’re one step closer to become a major success. Nevertheless, you still have a lot of work ahead of you. For instance, you’re going to need to go ahead and start marketing your company and site. This will prove to be far more difficult than you could ever imagine. You’ll need to focus heavily on the Internet, while building a presence across multiple channels, including social media. Here, you'll learn how to transform your ordinary business website into a major success.

Build a Social Media Presence

Social media sites, such as Twitter and Facebook, have grown immensely popular. In fact, they’re utilized by millions of people each day. With this in mind, you need to incorporate social media into your online marketing scheme. With social media, you will be able to communicate directly with your clients and this will give you the ability to convince them to buy your goods or services. At the same time, you can use social media to network with other business owners. Keep your social media accounts updated and it’ll prove to be a valuable asset to your marketing campaign.

Try Paid Advertising

It is possible to achieve a great deal through search engine optimization, but you should not ignore the potential of paid advertising. With paid adverts, you can guarantee that your website will begin to experience far greater levels of traffic. It is possible to pay for each click generated. Google, Bing and other search engines offer this type of service. If you’ve got the budget for it, adding paid advertising to your campaign is definitely a wise decision. Just make sure you keep a close eye on your monthly spending, so you can do not overdo it.

SEO

Search engine optimization is a great way to achieve your goals, while spending as little as possible. SEO can help push your site higher up Google’s ladder. In return, this will greatly increase the amount of traffic your site receives on a daily basis. In order to become a success with SEO, you’ll need to properly configure your website towards Google’s recommendations. Then, you will need to spend a great deal of time building high-quality and highly relevant backlinks to your site. With time and patience, your work will pay off and your profits will soar higher and higher.

If you do not have the time to carry out these activities on your own, you should read SEO service reviews and hire a good professional.

Newsletters

Once you’ve managed to convert your visitors into customers, you will want to transform these individuals to long-term customers. Customer retention is enormously important. Using an email newsletter is a good way to ensure your customers shop with you time and again. Any time you decide to hold a promotion or wish to give away a prize, you can send out an email to make your customers aware of it. Just remember that you need to make customers opt-in to your newsletter. Otherwise, your emails might be considered spam!

Follow These 5 Simple Steps to Get Better Content Marketing Results

As a small business owner, do you feel like your content marketing strategy needs an extra push? Here's our guide that you can follow in order to get better content marketing results.

Know What You're Selling

You can’t possibly create top-shelf content until you know what you’re selling — and why.

The roots of truly effective content marketing run deep. Long before you create a single piece of customer-facing content, you need to ask yourself and your team some basic questions that will define your strategy going forward. Such as:

• Why are we in business? Lays the groundwork for your mission/value statement.
• What needs do our products or services fill? What are their use cases? Wireframes your key marketing messages.
• Who are our competitors? How are they positioning themselves? What can we learn from them? A little inspiration never hurt.
• How do people hear about us? What’s the most effective way to reach them? Marketing strategies live and die by ROI.

Understand (and Segment) Your Audience

Modern content marketing is all about effective targeting. Effective targeting is all about knowledge — detailed knowledge about who your customers are, where they live and work, what motivates them, and why they want what you’re selling.

Your company’s universe of potential buyers is broad, not inscrutable. It’s just begging to be segmented into a manageable number of ideal buyer groups -- generalized profiles that combine demographic data, occupation, social status, motivation, use cases, past buying history, and more.

According to digital marketing entrepreneurs, sophisticated segmentation means looking beyond broad demographic categories to create detailed profiles of your ideal buyers. There’s no such thing as knowing too much about your prospects and customers.

Leverage Influencer Relationships

Many hands make light work — especially when those hands have big networks and bigger megaphones.

Early on, cultivate relationships with influential people in your organization’s industry or sphere of influence. Use their expansive social media reach and built-in credibility to broadcast your content farther than your network will allow. Influential people are usually willing to share excellent content that makes them look good by association.

Make Content Accessible Across Your Organization

Your organization’s right hand needs to know what the left is doing. This means content marketing is a team effort that extends well beyond those directly responsible for producing content — to the sales team, business development shop, account management department, all the way up to the C-suite. Responsive, unified messaging is a recipe for content marketing success.

Keep Your Audience Guessing

Variety is the spice of life — and content marketing. Publishing one blog post per week and supporting with a couple social posts does not a complete content marketing strategy make. Use a wider mix of media: videos, memes, blog posts, longform guides, white papers, case studies, podcasts, and anything else that aligns with your brand and target audiences. Deliver excellent, useful content and your prospects won’t mind the guessing game.

4 Things You Need to Improve Your Business' Website

Part of starting up your own business is to set goals. If you've already set up a website for your business or are still planning to make one, why not include its enhancement as one of your goals? Whether you're just getting started or you're looking to improve your website to increase visitors, here are some ways you can make your website's usability and visibility even better.

Use a Navigation Menu

Whether you have a simple website with just a few different pages (for example: Home, About Us, and Contact) or you have a detailed website with numerous pages, your website should definitely have a navigation menu. Implementing a navigation menu on your site can help your visitors easily find what they're looking for without going frustrated by searching over your entire website. Where you choose to physically place your navigation menu, whether it's at the top of the page, at the bottom of the page or a sidebar on either side, is totally up to you, but you'll want to make sure the navigation menu is in the same place for every page on your website so your visitors will know where to find it -- consistency is key. It also helps to have a "back to home" button on the same spot on every page of your site and a search feature so your users can easily search and locate what they need.

Include a Contact Form

Another way to help make your website more user-friendly is to include a simple contact form on your site. Not only does it help your customers get in touch with you should they have any questions or concerns, but it's also a great way to generate users feedback, which can help you decide what is and what isn't working for your small business. The contact form doesn't need to be overly complicated either, as long as it includes a blank field for users to submit their questions or comment, as well as a space for them to include their email address so that you have a way to respond to them. If you have an email marketing newsletter, including a sign-up form on your website is also a great way to help grow your subscriber list and reach your audience on multiple platforms.

Incorporate Social Media

If you have a website, you likely already know the importance of having an online presence, and social media should be a major part of this, if it's not already. Like everything else on your website, your social media channels should be easy for your visitors to find. Fortunately, most website builders offer social media features that allow you to easily add links to your social media profiles to your website. You can include social media follow buttons, which allow your visitors to "like" and "follow" your official social media pages, as well as social media share buttons, which allows users to share your website or content on your website with their friends and followers. A great way to grow your following is to use cross-platform promotion, so be sure to link to your official website on all your social media channels as well.

Don't Forget SEO

If you want to improve your website, it means improving its visibility online, which is where search engine optimization (or SEO) comes in to play. After all, if people can’t actually find your website, what’s the point of having one? SEO is important because a higher SEO ranking means your website might appear on the first page of a search engine’s results, whereas a lower SEO ranking could land your website on the second, third or an even lower page of results. Although you can pay search engines like Google and Yahoo! to help boost your SEO ranking through advertisements, there are other tools that several website building services, such as Wix and GoDaddy WebBuilder, provide to help boost your SEO ranking organically.

Simple Ways to Train Your Employees About the Latest Technology

Whether you’re in a corporate environment or own your own expanding business, figuring out the simple but effective ways to train your staff on technology and its upgrades can make or break your company or business.

Unfortunately, many corporate professionals still believe that when they received their diploma at school, their education was complete. How far from the truth this can be because learning is a never ending process and the only true constant in this world is change. Because of the advances in technology, particularly with business related ones, staying current is crucial. A business depends on its employees remaining up to date with technology to stay ahead or at least keep pace.

The difficulty lies in continually ensuring that your team is well trained on the technology, devices, and software they’re using, because:

• Old technology can hamper team members’ work and cost business countless hours of productivity.

• Outdated software is a large security threat. Your system is only as strong as the weakest link in your chain.

• Appearing uninformed about new devices or software may discourage potential clients and customers.

Know when to train

Say, for instance, that you choose to change from desktop computers to tablets. While Sam may be familiar with the mobile device, James may not be. Don’t assume that all employees will grasp a new system immediately. If each individual doesn’t fully understand how to use the technology, even if it’s just an upgrade to a platform your business is already using, you may run the risk of depleted productivity and morale.

Start with the team leaders

As you prepare to launch new software or any technology that affects your employees, consider training a select group of members first. Once they’ve been trained, they can coach their respective teams. Training the leaders first is an efficient technique for passing on information, as well as a great way to encourage collaboration. It also prevents a solitary instructor from becoming overwhelmed with requests and questions.

Try online training

Many small businesses actually exist exclusively online, with team members in different continents, countries, or states. For such a business, in-person training would be wildly expensive and time-consuming. Online coaching is a powerful alternative. Aside from their easy accessibility, online training sites can offer asynchronous timing. Freeing your staff from fixed timelines can allow team members in varied locations around the country or around the world to each learn at their own pace.

Allow employees to experiment with the new tools and software

Most of us take new cars for test drives before we buy them. So why not let your team members experiment with new software or technology before using it in full for the business? If you’re rolling out a new device or program, allot your staff a week to practice with the new tool and solidify their lessons. Ensure that a well-trained team member is handy to answer the questions that will naturally arise.