Many of you may have heard of the 1 Page Business Plan. A smart, and now rich man, once determined that business plans were too long, and that often times VIP’s and decision makers don’t even read past the first couple pages of your business plan. In response to this problem he created the 1 Page Business Plan brand. He wrote books, trained others, and made a fortune I am sure. Although his assumptions were correct that many people will not read more than a page or two of your business plan, there are still a number of reasons why you should not simply write a 1 page business plan.
Credibility – Whether a banker or investor actually reads your entire business plan is besides the point. Handing over a nicely bound and professionally written business plan to your banker will provide immediate credibility that you have done the work. On the other hand, if you simply write a one page business plan, which is essentially an executive summary, it will look like you have not done the work and the research to validate your business endeavour. The business plan gives the banker or potential investor the impression that you have at least considered items like your competition, your marketing plan, and your business model.
Business Plans are for Internal Use – The purpose of a business plan is not only to appease a banker or investor, rather a business plan can be valuable for internal use. If you have a simple one page business plan you will probably run out of direction for your business after week one. Your business plan should be an internal road map for you business that is constantly changing and adapting with the competitive environment you find your business in.
The Purpose of an Executive Summary is to Intrigue the Reader – If your executive summary or one page business plan is successful, it will intrigue the banker or investor to ask for more questions or more detail about your business. If all you wrote was an executive summary, what extra detail can you provide? A full business plan will allow you to provide interested parties with additional detail regarding your business.
Ultimately there are a number of reasons why you should write a full business plan. The value of a one page business plan or an executive summary is that is compels the reader to ask for more. It should be intriguing and should supplement a document that provides the reader with more detail on any aspect of the business that they wish to learn more about. Keep this in mind as you consider taking the easy way out when writing your business plan.