Contextualise Your Budget _ Of course your budget will be extremely important. But sometimes people sort of pluck figures out of thin air, not giving it the context it needs in the business plan to make real concrete sense of how that budget is going to work. So it is crucial that every time you mention financials in your business plan, to really give them the correct context. When I have worked with clients in developing business plans, there has been a budget or amount set aside for example to be spent on marketing, which has been decided a bit arbitrarily. I mean with no real research, no understanding of what that amount needs to be spent on, and what that budget will truly achieve. It seems to have been put there to fill the need to attribute a certain sum to marketing. Make sure you are researching each point of your budget, make sure that you are giving it context and it makes proper sense within your overall plan.
Everyone has prepared a business plan. Well, should that read, everyone should have prepared a business plan? My thinking is that these tend only to be prepared when they are needed, rather than as a useful business tool for all senior management. My top five ingredients are: 1. Understand what a business plan is; 2. Understand what you intend to use it for; 3. Identify and implement the critical steps to achieving a successful business plan; 4. Understand what needs to be included in the plan; 5. Be aware of gaps or weaknesses in your plan.