Only one in five small firms has a formal business plan in place but research suggests many SMEs are doing well in spite of the lack of detailed planning.
A new survey by Adobe Express has found that just 20% of new and established business owners have a formal business plan in place. However, the findings also show that confidence levels are relatively high in the SME community and most businesses say they’ve had a good year.
Almost half of UK adults (47%) are thinking about starting a business or side hustle this year, up 12% since 2024. However, it seems business planning is not a top priority for every business owner or would-be entrepreneur. Currently, only 20% of business owners have a detailed business plan, 47% have a basic outline, 23% are working on a plan and 10% don’t intend to create a plan at all, according to the research by Adobe Express.
Small business success
In spite of the mixed picture when it comes to business planning, many of the business owners polled say they have either met or exceeded their targets in the past year:
- 15% have significantly exceeded their targets;
- 41% have moderately exceeded their targets;
- 14% have met their targets;
- Only 5% have fallen short of reaching their goals.
Confidence is also high, with 23% of business owners saying they are “extremely confident” about their plans for the business and that they can meet their targets in 2025/26; 39% are very confident about their prospects and 27% say they are confident.
Top concerns for small firms
Business owners are most concerned about the economic downturn (25%) and the challenges of adapting to rapidly changing technology (12%). Despite fears around technological changes, 27% of those surveyed admitted that they aren’t currently using AI-powered tools or resources to help with business planning, with 11% of these saying they don’t know about any AI tools that could help them make a business plan.
How have specific sectors performed?
The Adobe Express research also investigated how specific sectors have performed in the past year. The findings show that:
- 50% of businesses in the environment and agriculture and media and internet spheres significantly exceeded their annual targets, the highest of any industry surveyed.
- Most sectors generally met or exceeded their annual targets, with the exception of legal businesses where 33% claimed to be slightly below targets, alongside 17% of hospitality and events businesses.
- In the creative arts and design sector, a worrying 8% of firms said they were “significantly” below their annual targets.
Interestingly, 11% of those in accountancy, banking and finance said they have “no confidence at all” that their business plan will work, even though the data shows that 24% of these businesses significantly exceeded targets, 28% moderately exceeded targets and 24% met targets. The remaining 24% of respondents are new businesses.
Written by Rachel Miller.