Does your SME have a solid business plan? » SMEInsider

Does your SME have a solid business plan?

A quarter of small businesses in the UK don’t have any strategy in place to support their business growth, new research from Barclays has found.

In fact, less than half (47%) of UK SMEs have a formal, written or recorded business plan, and the remaining 25% have an informal plan that has been verbally agreed on. Beyond this, only one in two small businesses (49%) has a succession plan in place.

The older a business, the Barclays research found, the more likely it is to have a formal business plan in place. Two thirds (66%) of businesses established over 35 years ago have a business plan, compared to just 35% of businesses aged between six and ten years, and 44% of businesses aged five years and younger.

“Having a business plan is fundamental for a small business,” said Rebecca McNeil, managing director for Business Lending and Enterprise at Barclays. “It defines exactly what you want to achieve, how you plan to achieve it across a set time period, and is a sure fire way to ensure that growth targets and plans are being met.”

McNeil noted the importance of revisiting and adjusting business plans as a company develops.

“A strong plan can help applications for finance from a business loan to alternative forms of finance and investment,” she added.

Also, when a business is in trouble, having a solid plan can help to steer it back to good health.

“A lack of succession plan can put the future success of a business at risk, so this needs to be considered far earlier and more formally than the results show,” she said.

Ultimately, a solid, reactive business plan put the necessary tools in place for a small business to grow, and means that the company is less likely to get sidelined or distracted from its purpose if something goes wrong.

  • Rajendra Dheer

    I have offered my comments – see below. The survey mentioned here reinforces what I have learned before.