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Suggest You - Business Plan Mistakes - The Phantom Growth Rate
Batch Inclusion Plastic Bags - 7 Ways To Avoid Price Increases
Rubber compounding companies have been using batch inclusion plastic bags for years to increase productivity and assure batch to batch uniformity. However, these particular packaging bags, also known as low melt bags, can also be counted on to reduce product loss, decrease solid waste disposal costs and most importantly minimize worker exposure to hazardous materials. As the cost of plastic resin continues to spiral upward here are 7 ways to minimize or even eliminate a price increase.1. Consider using thinner material. Recent advances in film technology can allow you to red
3,750,000Rubber compounding companies have been using batch inclusion plastic bags for years to increase productivity and assure batch to batch uniformity. However, these particular packaging bags, also known as low melt bags, can also be counted on to reduce product loss, decrease solid waste disposal costs and most importantly minimize worker exposure to hazardous materials. As the cost of plastic resin continues to spiral upward here are 7 ways to minimize or even eliminate a price increase.1. Consider using thinner material. Recent advances in film technology can allow you to red
5 4,688,000
This summary proudly boasted a projected growth rate of 25% annually.
Noticing that the business plan writer had switched from a monthly chart to an annual chart alerted me to a potential trap. Sure enough, they had fallen in--big time!
Let me explain. (I am letting you in on my thinking at this time--I hadn't said anything yet to my friend.)
They projected an annual growth rate of 25%. But look at this: doesn't the last month of the first year have sales in excess of $600,000? Look in the first table. Sure enough--$645,
Medical Coding
Medical codinng is a way of keeping track of long names of diseases, ailments, injuries, and so on, by name. It helps by cutting down on the amount of time spent keeping medical records. That way, everyone saves time and money.A career in the medical profession is a challenge, adventure and competition. One can belong to any of the fields of medical science. One can be a doctor, medical officer, pharmaceutical manager, administrator of a hospital, nurse, medical transcriptor, medical biller, medical coder and much more. However, medical careers are particularly related to the m
While visiting a friend, he asked a favor of me. He whipped out this humongous business plan consisting of two full 3-inch loose-leaf binders. Someone he knew had paid a whopping $250,000 to have this business plan prepared and my friend was interested in my opinion of it.Medical codinng is a way of keeping track of long names of diseases, ailments, injuries, and so on, by name. It helps by cutting down on the amount of time spent keeping medical records. That way, everyone saves time and money.A career in the medical profession is a challenge, adventure and competition. One can belong to any of the fields of medical science. One can be a doctor, medical officer, pharmaceutical manager, administrator of a hospital, nurse, medical transcriptor, medical biller, medical coder and much more. However, medical careers are particularly related to the m
At first I considered telling him I had something else to do and couldn't spend the next ten hours reading a "Gone-With-The-Wind" business plan. Had I been an actual potential investor presented with this monster, I would have simply dumped it in the trash and told the entrepreneur, "Thank you for considering me as a potential investor, but it doesn't fit my current criteria."
Nevertheless, I relented and agreed to look it over. My thought was, "OK, give it to me and I'll look it over as soon as I can." No such luck. He sat down at the table next to me with a child-like grin of anticipation on his face. He wanted me to look it over and give my opinion now! I thought, how can he expect me to digest this while he is looking at me like a puppy waiting for me to toss him a ball?
So, I dug in. Little did I know that this would turn out to be one of the fastest appraisals I would ever make.
Just like an investor, I turned to the financials in the back. (Note--investors typically don't read a business plan from the front to the back. They start by looking at the financials in the back!)
On the first page of the financials section, I saw a summary showing two graphs represented by the following tables (the actual numbers and dates have been changed to protect the guilty):
Year 1 Projected Revenues
Month Revenue
----- -----------
1 $ 7,457
2 11,185
3 16,778
4 25,167
5 37,750
6 56,626
7 84,938
8 127,407
9 191,111
10 286,667
11 430,000
12 645,000
----- -----------
Total $ 1,920,086
Annual Projected RevenuesThis summary proudly boasted a projected growth rate of 25% annually.
Year Revenue
---- -----------
1 $ 1,920,086
2 2,400,000
3 3,000,000
4 3,750,000
5 4,688,000
Noticing that the business plan writer had switched from a monthly chart to an annual chart alerted me to a potential trap. Sure enough, they had fallen in--big time!
Let me explain. (I am letting you in on my thinking at this time--I hadn't said anything yet to my friend.)
They projected an annual growth rate of 25%. But look at this: doesn't the last month of the first year have sales in excess of $600,000? Look in the first table. Sure enough--$645,0
How to Choose Your Ideal Career
They say that most people do complete and total career changes at least once often twice in their lifetimes. Very few people chose the ideal perfect career for themselves when they're in high school and blissfully happily work those same jobs for the rest of their lives. With the way that technology and everything else changes so fast, I think it's ridiculous to expect to stay in one job from the time you leave school until you retire. Even staying in the same company can be a huge challenge. So how will you pick your first career? Your next major career change?The first t
tor, but it doesn't fit my current criteria."They say that most people do complete and total career changes at least once often twice in their lifetimes. Very few people chose the ideal perfect career for themselves when they're in high school and blissfully happily work those same jobs for the rest of their lives. With the way that technology and everything else changes so fast, I think it's ridiculous to expect to stay in one job from the time you leave school until you retire. Even staying in the same company can be a huge challenge. So how will you pick your first career? Your next major career change?The first t
Nevertheless, I relented and agreed to look it over. My thought was, "OK, give it to me and I'll look it over as soon as I can." No such luck. He sat down at the table next to me with a child-like grin of anticipation on his face. He wanted me to look it over and give my opinion now! I thought, how can he expect me to digest this while he is looking at me like a puppy waiting for me to toss him a ball?
So, I dug in. Little did I know that this would turn out to be one of the fastest appraisals I would ever make.
Just like an investor, I turned to the financials in the back. (Note--investors typically don't read a business plan from the front to the back. They start by looking at the financials in the back!)
On the first page of the financials section, I saw a summary showing two graphs represented by the following tables (the actual numbers and dates have been changed to protect the guilty):
Year 1 Projected Revenues
Month Revenue
----- -----------
1 $ 7,457
2 11,185
3 16,778
4 25,167
5 37,750
6 56,626
7 84,938
8 127,407
9 191,111
10 286,667
11 430,000
12 645,000
----- -----------
Total $ 1,920,086
Annual Projected RevenuesThis summary proudly boasted a projected growth rate of 25% annually.
Year Revenue
---- -----------
1 $ 1,920,086
2 2,400,000
3 3,000,000
4 3,750,000
5 4,688,000
Noticing that the business plan writer had switched from a monthly chart to an annual chart alerted me to a potential trap. Sure enough, they had fallen in--big time!
Let me explain. (I am letting you in on my thinking at this time--I hadn't said anything yet to my friend.)
They projected an annual growth rate of 25%. But look at this: doesn't the last month of the first year have sales in excess of $600,000? Look in the first table. Sure enough--$645,
7 Reasons To Work From Home
What are the best bonuses of working from home? There are several reasons that add to the experience apart from the obvious one of spending more time with your family and earning money.1. Chose your own hours of work.Whether you prefer to do one long stint of work to get it over and done with or a little bit here and a little bit there it is no ones decision but yours.2. Take a day off whenever you choose.If like me you've ever being refused a day off that you really need just because there are other members of staff off work you will understand why
I turned to the financials in the back. (Note--investors typically don't read a business plan from the front to the back. They start by looking at the financials in the back!)What are the best bonuses of working from home? There are several reasons that add to the experience apart from the obvious one of spending more time with your family and earning money.1. Chose your own hours of work.Whether you prefer to do one long stint of work to get it over and done with or a little bit here and a little bit there it is no ones decision but yours.2. Take a day off whenever you choose.If like me you've ever being refused a day off that you really need just because there are other members of staff off work you will understand why
On the first page of the financials section, I saw a summary showing two graphs represented by the following tables (the actual numbers and dates have been changed to protect the guilty):
Year 1 Projected Revenues
Month Revenue
----- -----------
1 $ 7,457
2 11,185
3 16,778
4 25,167
5 37,750
6 56,626
7 84,938
8 127,407
9 191,111
10 286,667
11 430,000
12 645,000
----- -----------
Total $ 1,920,086
Annual Projected RevenuesThis summary proudly boasted a projected growth rate of 25% annually.
Year Revenue
---- -----------
1 $ 1,920,086
2 2,400,000
3 3,000,000
4 3,750,000
5 4,688,000
Noticing that the business plan writer had switched from a monthly chart to an annual chart alerted me to a potential trap. Sure enough, they had fallen in--big time!
Let me explain. (I am letting you in on my thinking at this time--I hadn't said anything yet to my friend.)
They projected an annual growth rate of 25%. But look at this: doesn't the last month of the first year have sales in excess of $600,000? Look in the first table. Sure enough--$645,
Design Your Business Card Online
A business card is an ideal partner to getting your business recognized by potential clients. Business cards can be created online through a variety of templates for you to choose from. This makes the process a lot easier when you can choose a business card template and then customize it to your business. It is a fun and easy way to create your business cards online and can actually save you time and money because you do not have to consult a graphic designer. You are the designer. It is less stressful and it puts you in control of your business card needs.Business card printin
4 25,167A business card is an ideal partner to getting your business recognized by potential clients. Business cards can be created online through a variety of templates for you to choose from. This makes the process a lot easier when you can choose a business card template and then customize it to your business. It is a fun and easy way to create your business cards online and can actually save you time and money because you do not have to consult a graphic designer. You are the designer. It is less stressful and it puts you in control of your business card needs.Business card printin
5 37,750
6 56,626
7 84,938
8 127,407
9 191,111
10 286,667
11 430,000
12 645,000
----- -----------
Total $ 1,920,086
Annual Projected RevenuesThis summary proudly boasted a projected growth rate of 25% annually.
Year Revenue
---- -----------
1 $ 1,920,086
2 2,400,000
3 3,000,000
4 3,750,000
5 4,688,000
Noticing that the business plan writer had switched from a monthly chart to an annual chart alerted me to a potential trap. Sure enough, they had fallen in--big time!
Let me explain. (I am letting you in on my thinking at this time--I hadn't said anything yet to my friend.)
They projected an annual growth rate of 25%. But look at this: doesn't the last month of the first year have sales in excess of $600,000? Look in the first table. Sure enough--$645,
Evaluating a Spanish Translator Certification Program
Spanish translator certification programs are becoming more and more prevalent as more and more people realize the importance that Spanish translation plays and will continue to play now and in the future. In order to take advantage of all the opportunities brought about by an increase in Spanish speakers, those with a solid grasp of English and Spanish are taking advantage and looking for ways to become translators.In order to better their prospects for getting business, translators often turn to Spanish translator certification programs to prove their abilities to future clie
3,750,000Spanish translator certification programs are becoming more and more prevalent as more and more people realize the importance that Spanish translation plays and will continue to play now and in the future. In order to take advantage of all the opportunities brought about by an increase in Spanish speakers, those with a solid grasp of English and Spanish are taking advantage and looking for ways to become translators.In order to better their prospects for getting business, translators often turn to Spanish translator certification programs to prove their abilities to future clie
5 4,688,000
This summary proudly boasted a projected growth rate of 25% annually.
Noticing that the business plan writer had switched from a monthly chart to an annual chart alerted me to a potential trap. Sure enough, they had fallen in--big time!
Let me explain. (I am letting you in on my thinking at this time--I hadn't said anything yet to my friend.)
They projected an annual growth rate of 25%. But look at this: doesn't the last month of the first year have sales in excess of $600,000? Look in the first table. Sure enough--$645,000 to be exact.
Now, if there were NO SALES GROWTH (0%) from that last month's level, what would be the revenue for the next year? Twelve times $645,000, right? That comes to a whopping $7,740,000!
$7,740,000 is over $3,000,000 more than they projected for the fifth year. That's after four years of "25%" annual growth, according to them!
Remember, I said NO GROWTH--zero--nada--zip!
I asked my friend why the company was projecting to lose sales! He had a look of astonishment and confusion.
I continued by asking him if the company expected to start the next year at low levels again and build up again, or would they start at the level of the last month and drop down during the year, or what?
It finally dawned on him that, by changing the projection time frame, the writers had missed the mathematical relationships. Seeing this flaw in the logic, he made my appraisal for me. He recognized that the rest of the projections were obviously in error and the entire plan was essentially worthless. At best, a major review of the numbers was needed.
The result: $250,000 blown in 5 minutes because of a phantom growth rate!
By the way, you may think this was a single, isolated case. Believe me, it wasn’t. I have found this logic error in the majority of plans. In every case, the business plan writer is astonished and completely deflated. While that is never my intention, it does remind us how easy it can be to succumb to these kinds of traps.
(c) Copyright 2006, Leonard M. Stillman Jr., All Rights Reserved.
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