Almost Third of Small Businesses Think a Business Plan is Irrelevant
Many small and medium enterprises do not have a formal business plan in place and believe a plan is “not necessary”
Almost a third (29%) of small and medium sized businesses don’t have a formal business plan with 43% asserting that a plan is not important, according to the latest Close Brothers Business Barometer (CBBB).
Of the remaining number of business owners without a plan, 20% say that they prefer to keep an informal plan in their head and 15% believe that, although a plan isnot completely irrelevant, an official business strategy is not a priority.
The survey also found that, of the small businesses who have a formal strategy in place, 14% only review their business plan every two to five years.
Small businesses could be missing out on opportunities to grow by not having (or failing to review) a formal business plan, with a recent Barclay’s report (also highlighting the number of small firms without a formal plan in place) indicating that having a strategy in place usually attributes to growth and success.
Mike Randall, CEO of the CBAF, commented on the findings:
“Planning is key to any business throughout its lifecycle. A formal plan can be an extremely valuable tool for managing and growing a business as it allows a company to recognise its strengths and weaknesses and ensure they have appropriate plans in place.”
“Organisations of all shapes and sizes may benefit from a business plan however, a plan is only useful if it is reviewed regularly to ensure that it meets the current and future needs of the business. Therefore it’s sensible to review current performance on a regular basis and identify opportunities for improvement and growth.”
For information and tips on creating an effective business plan, check out Startups.co.uk’s business plans channel here.