No Goal, No Growth: The Case for Business Planning
If you’re a business owner, you’ve probably been told more than once that you need to set goals. But here’s the reality, according to the recent It’s Your Business Report from Xero: almost half of small business owners in Australia don’t have long-term goals for their business, and only 31% have an ‘endgame’ in mind, meaning a clear vision of what happens when they step back, sell, or pass the business on.
That’s a lot of entrepreneurs operating without a destination in sight. And when you don’t know where you’re going, every financial decision becomes harder.
Why Goals Matter More Than You Think
Running a business without a goal is like setting off on a road trip without a map. You might keep moving, but chances are you’ll waste time, energy, and resources along the way.
The Xero research shows that many entrepreneurs are focused on short-term problem-solving, like refining processes or making incremental improvements, but not necessarily on where those improvements should ultimately take them.
Here’s why that matters:
Financial planning loses direction. Without knowing whether you want to grow, stay steady, or prepare for exit, cash flow forecasts and budgets are built in isolation.
Investment decisions become reactive. Should you hire now? Buy new equipment? Expand into a new market? These choices are clearer when measured against a long-term aim.
Energy gets scattered. Business owners without goals often spread themselves too thin, working hard but not necessarily working towards something meaningful.
The Link Between Goals and Financial Decisions
Your financial decisions should always be grounded in the bigger picture. For example:
If your goal is growth, you’ll need to invest in talent, systems, and marketing, even if it means tighter margins for a period.
If your goal is stability, you’ll want to protect cash reserves, strengthen recurring revenue streams, and avoid unnecessary risk.
If your goal is exit, you’ll make choices that maximise valuation, such as getting financials in order, reducing dependencies, and building transferable systems.
Without a clear goal, it’s impossible to answer the most important financial question: What’s the return on this decision in relation to where I’m trying to go?
Steps to Make Sure You Have a Goal in Place
Setting business goals doesn’t need to be complicated. Here’s a framework to help:
1. Define Your Endgame
Ask yourself: What do I ultimately want from this business? It could be:
To sell within five years.
To pass it on to family.
To create a stable lifestyle income.
To scale into new markets.
Your endgame doesn’t have to be set in stone, it will most likely evolve over time. But having a north star will make every decision clearer.
2. Break It Down into Milestones
Once you have the endgame in mind, translate it into 3-year and 12-month milestones. For example:
Endgame: Sell in 7 years for $5M.
3-year milestone: Reach $3M revenue with 20% net profit.
12-month milestone: Increase average client value by 15% and expand into two new markets.
These milestones become the basis for your financial targets.
3. Align Your Forecasting
Financial forecasting is about testing decisions against your goals. If you want to expand, build a forecast that models hiring costs, systems upgrades and revenue growth. If you want to protect lifestyle income, model scenarios that keep margins strong while reducing personal workload.
The Xero report highlights that many entrepreneurs lack succession plans (43%). Forecasting helps bridge that gap by showing what’s required financially to make your desired endgame possible.
4. Make Goals Visible
Goals that live in your head don’t drive action. Document them, share them with your advisors, and track progress. Consider setting up a dashboard with both financial and non-financial indicators so you can see at a glance whether you’re on track.
5. Revisit Regularly
Markets shift. Personal circumstances change. Goals should be reviewed at least annually, if not quarterly. The key is to maintain flexibility while still having a defined direction.
Common Pitfalls to Avoid
Confusing activity with progress. Just because you’re busy doesn’t mean you’re closer to your goal.
Waiting too long to set an endgame. The earlier you define it, the more strategic your decisions can be.
Not involving advisors. External advisors, such as accountants, Virtual CFOs, or business coaches, can provide perspective and can help align numbers with strategy. In fact, entrepreneurs who work with advisors are more likely to report revenue increases and higher confidence.
Why Now Is the Time to Get Clear
The Australian small business landscape is challenging with rising costs, economic uncertainty, and competitive pressure. In this environment, clarity is essential.
If 49% of business owners don’t have long-term goals, those who do immediately put themselves ahead of the curve. They can make faster, more confident financial decisions, and they’re more resilient when external conditions shift.
Business success looks different for everyone. For some, it’s about freedom and lifestyle. For others, it’s growth and legacy. But whatever your definition, you need a goal to shape the financial roadmap that will get you there.
So take the time to ask yourself: What am I really building? Because when your goals and financial decisions work together, you don’t just grow a business, you grow it in the right direction.