Red flags: a few reasons why a business plan could be rejected

Bear in mind the following warning signs when considering starting or growing your business

  • Over-gearing of the business;
  • Insufficient experience of key management – the inability to successfully manage & grow the business;
  • The business owners are not actively involved in the business;
  • The market for the product is clearly saturated or non-existent;
  • Inability to justify various assumptions in the business plan – failure to demonstrate how market share will be captured;
  • Conflicting information between the business plan and supporting data will result in the ability of the entrepreneur being called into question;
  • Failure to deliver key outstanding agreements or requirements that are essential to the success of the plan, such as major contract which does not materialise;
  • Non-compliance (legal, statutory, tax) in existing companies that wish to expand;
  • A poor credit rating does not bode well at all.