UK200Group members comment on news that a quarter of SMEs do not have a business plan
Members of the UK200Group of independent accountancy and law firms have today commented on news that ineffective planning could mean Britain’s small businesses will lose out on £25bn in extra revenue in 2016. According to research by the Centre for Economics and Business Research that was commissioned by npower Business, more than a quarter of SMEs surveyed say they do not have a business plan in place. This means that they have entered the new year without basic objectives, revenue targets or a plan to manage cash flow.
Duncan Montgomery, tax partner at UK200Group member firm Whittingham Riddell, said:
“Once SMEs hit a certain size, business owners need to have an approach of working on the business, not in it, which means loosening the reins a little and empowering management to take on tasks and let the owners ensure that business plans are in place, working well and kept to or beaten. Simply put, you cannot do it all yourself. Where business plans score is to keep different disciplines accountable for their part of an operation and build teamwork across an organisation, defeating a ‘them and us’ attitude. In smaller organisations, they give people the ability to take a step back and look at how things are going, see opportunities and develop the business. Simply turning up every day and doing the same thing and expecting a different outcome is the very definition of business madness.”
Michael Watts, corporate finance partner at UK200Group member firm Haslers, said:
“It is very easy for SME owner managers to spend all their time dealing with day-to-day business matters. They need to periodically take the management team away from the office and agree a strategy/business plan for the next year to five years and then review this on a regular basis. We have a number of clients who have started this process away from the office and they all find it incredibly helpful. There are accountants within the UK200Group that are able to facilitate these sessions, or the clients are able to do it themselves, but the key is taking the time out of the business to come up with a plan.”