No RulesWritten by Dave Balch
For an interesting experiment, I suggest that you go to any local event where there are a number of different small businesses exhibiting or selling their wares. A swap meet would be a good example, or a street sale, or a local fair. When you are there, observe different styles of businesses.Some people put their merchandise on a table and then just sit there and wait for customers to come. Others arrange everything "just so" with colorful table coverings, plants, and other decorations to create an inviting look. They put up signs that describe who they are and what they offer, and then they greet passersby with a friendly smile. Then there are outrageous ones who dress-up in costumes, have loud music blaring from behind tables, or try to entice customers with entertainers. The variety of approaches to accomplish essentially same goal is fascinating. But, as usual, there is a lesson here: there are no rules about how to conduct your business. Sure, there are some basic things you should do, but key word here is "should". For example, it's simply common sense to treat your customers with respect, but even that can be ignored as in case of a restaurant that I know where big attraction is that servers are rude to their guests! Insults are "special of day", and believe me they let 'em fly! It's a successful business, too. Go figure. Since we're talking about rules, let me clarify one thing: there are definitely rules to follow as stipulated by management of event. If they say that you can't have loud music, then you can't. If they say that you have to stay within your assigned booth when doing business, then you do. I just returned from sharing a booth at a book fair. Some of people in booth chose to ignore that particular rule, and they evicted us! They actually came on morning of second day and moved all of our materials into street so that new occupants could move in! It was unreal, and it was done in a rude, arrogant, and unprofessional manner (but that's another article!).
| | Seven Critical Mistakes You Don't Want To Make In Your Business PlanWritten by Dee Power
If you're looking for investors, you need a business plan and not just any business plan. You need one that is well crafted, concise and exciting. But how do you know what venture capitalists want to see in a business plan and how can you avoid what they feel are top seven critical mistakes? We asked venture capital companies across United States how they evaluated business plans presented to them. The VCs were asked: What is worst mistake an entrepreneur can make when completing their company's business plan?Seven Critical Mistakes 1. Lack of Clarity ********************** VCs believe that entrepreneurs are not clear in explaining opportunity. Why business made sense, why business model would be successful. Entrepreneurs can avoid this mistake by simply asking several people who aren't familiar with their company to read business plan. If they don't "get it", it's unlikely an investor will. 2. Unrealistic Projections ****************************** In second place is a mistake that is difficult for entrepreneurs to avoid: unrealistic projections. While it's true that company must produce enough revenue to be able to generate 30% to 40% yearly returns that VCs expect, those projections have to be reasonable and achievable. Apply common sense. You can get an idea of whether your projections are in ballpark by looking at annual reports of public companies in your industry. 3. Simplistic Assumptions ************************* Simplistic assumptions are closely related to unrealistic projections. Avoid 'all tea in china' syndrome. You know logic of 'there are 80 billion Chinese people, if we sell just one tea bag to only 10% of them we'll make a lot of money'. Justify your assumptions, base them on as much research as you can.
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