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Paucity of planning

THE National Australia Bank’s Business Planning Survey has revealed an alarming level of complacency amongst the state’s small business owners when it comes to planning for the future, with 87 per cent not completing a business plan. Despite being faced with increasingly uncertain economic conditions as 2009 approaches, 25 per cent of Western Australian SMEs believe they are too small to warrant a business plan, 18 per cent lack time to write one, and 18 per cent believe they don’t need one. State general manager of NAB’s Business & Private Banking, Andrew Whitechurch, said the current economic conditions made it even more important for businesses to plan for the future. “Western Australian businesses are taking a big risk if they enter 2009 without an up to date business plan,” he said. “While in recent times a booming economy has meant many businesses have enjoyed success without a great deal of planning, as business conditions deteriorate and belts tighten, small businesses need to plan for uncertain times ahead.” Mr Whitechurch said respondents who assumed they were too small to need a business plan were particularly vulnerable to instability in the market and economy. He said without such a plan SMEs could not adequately prepare for any further slowdown in the economy. “You should set achievable and measurable business goals and consider the economic, geographic and business environment you are working under,” Mr Whitechurch said. He said a business plan should include a SWOT analysis, a review of trading cycles, costs and expected cash flow, detail market conditions, and business owners should formulate clear and measurable goals that are time specific.

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