More than one quarter of UK small businesses have no business plan
Britain’s small firms could be missing out on some 25bn in revenue by not having a business plan to guide decision making, according to new research by the Centre for Economics and Business Research (Cebr).
The survey commissioned by npower Business found than some 26 per cent of small UK firms operated without a business plan in 2015.
Yet those owners who did have a blueprint for their company’s future direction were expecting to reap the rewards and predicting revenue growth almost two percentage points higher than the SME average.
Laura Holdgate, a senior economist at Cebr, said: The research suggests that more effective business planning among the UK’s SMEs is directly linked to better business performance. SMEs have the potential to experience higher turnover growth as a result of more effective business planning, in turn boosting UK plc.
Additional data from the Association of Accounting Technicians (AAT) published recently suggested that the proportion of micro firms without plans in place could be even higher with some 58 per cent of small business owners admitting they didnt have one.
“Having the necessary financial skills and a clearly defined business plan are essential tools to help firms expand successfully, said AAT chief executive Mark Farrar.
Phil Scholes, head of npower Business, commented: Effective planning is essential for small businesses who are the backbone of the UK economy. Being in better control of their finances and the risks and opportunities facing their business enables them to make better, more effective decisions.
Hannah Wilkinson is a reporter for Business Advice. She studied economics and management at Oxford University and prior to joining Business Advice wrote for Kensington and Chelsea Today about business and economics as well as running a tutoring company.
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