Story Highlights
- 71% of business owners do not have a business plan
- Employers are more likely to have a plan and to have submitted an RFP
- Businesses that engage in planning and RFPs are more likely to report growth
WASHINGTON, D.C. — Most business owners are running their businesses without a formal plan for growth and without experience in competing for structured opportunities. Seventy-one percent say they do not have a business plan, and just 10% have ever submitted a response to a request for proposal (RFP).
These findings come from Gallup’s Pathways to Wealth research initiative, conducted with support from JPMorganChase and the Ewing Marion Kauffman Foundation. The Year 3 survey examines how different forms of work and business ownership connect to income, wealth and wellbeing.
Owner-employers[1], those who operate businesses with one or more employees, are nearly twice as likely to have submitted an RFP as non-employer owners and other owner types are.
Owner-employers are also much more likely to have a business plan in place. Forty percent have an informal (29%) or detailed (11%) business plan, compared with 22% of non-employer owners, 16% of self-employed workers and 24% of those who work primarily as an employee but have other work arrangements.
The survey was conducted with 5,926 working U.S. adults, including more than 3,500 business owners recruited primarily from the probability-based Gallup Panel.
These differences relate to a broader pattern seen in the study: Owner-employers consistently enjoy financial outcomes that are superior to those of other ownership groups. Owner-employers report higher earnings, greater financial security and higher levels of wellbeing. The implication: How a business is run is closely tied to how it performs financially.
Planning and Procurement Are Linked to Business Momentum
Businesses with a working plan in place are more likely to report growth than those without one. Among all business owners, 38% of those with an informal plan report year-over-year revenue growth, as do 27% of those with a detailed plan. The percentage experiencing growth drops to 21% of owners with no business plan and 19% of those still developing one.
Pursuing RFPs shows a similar pattern: 33% of businesses that have submitted an RFP report revenue growth, compared with 23% of those that have not.
Among businesses that are growing, those with RFP experience are more likely to report higher levels of growth, suggesting that engagement in structured opportunities may be associated with scaling revenue.
At the same time, RFPs are not relevant to every business. Many owners operate in industries where formal procurement is uncommon or unnecessary, and others rely on more direct or informal ways of generating customers. The differences in growth reflect both access to these opportunities and the decision to pursue them where they are applicable.
Not All Owners Feel Equipped to Formalize a Plan
Among owners without a detailed business plan, just 18% say they are “highly confident” they could write a business plan that would be deemed satisfactory by a potential business partner or investor. Forty-six percent say they are “somewhat confident,” while the remaining 35% indicate they are “not at all confident.”
One-third (33%) of business owners who aren’t highly confident in their ability to create a plan say the primary reason is not yet knowing their own plans, indicating they are still working through how their business grows and where it is headed. Another 25% say they would not know how to write a business plan, pointing to a skills-based gap in turning their plans into a formal document. Smaller shares cite uncertainty about current market conditions (18%), poor business performance (8%), or another reason (15%).
These responses show that, for many owners, the absence of a plan reflects a business in an early stage of development or a lack of technical know-how on the part of the owner.
Some owners who have not written a business plan indicate additional support would be beneficial. While a majority of owners (65%) say they could write a business plan on their own, more than one-third feel they could not.
An even larger share of business owners (75%) say they could definitely (38%) or probably (37%) find someone outside their business to help write a plan. Still, about one in four do not report having a clear path to outside support.
Many Owners Have Not Considered RFPs as a Growth Path
RFP participation is limited partly because many owners do not view the process as relevant to their business. Among those who have never considered competing for an RFP, the largest share (49%) say their business is not in a relevant industry, and 29% say their business is too informal to compete for these types of opportunities. These responses reflect real constraints. RFPs are more common in certain industries and often require a level of organizational structure that not all businesses have.
Beyond these barriers, lack of awareness and access also play a role. Thirty-nine percent of owners who have never considered competing for an RFP say they do not know enough about them, and 12% say they do not know how to find them.
Few owners point to the application process itself as the main obstacle. Only 5% say the process is too complex, and 4% indicate regulatory requirements would be too burdensome.
Implications
Most U.S. business owners do not have a formal business plan, and few have competed for RFPs, potentially resulting in these businesses being less profitable than they could otherwise be. Meanwhile, those who do engage in these practices report stronger growth outcomes. Some of this difference in business growth may reflect structural advantages that businesses that are eligible to compete for RFPs may have.
At the same time, other responses point to gaps in readiness and awareness. Many owners say they do not know enough about RFPs or how to find them. Similarly, many don’t yet know their own business plans or are unsure of how to formalize them. These patterns suggest that a meaningful share of businesses are not opting out after evaluating these pathways, but are not yet positioned to engage them.
Awareness is also a key differentiator. Increasing understanding of RFPs, clarifying which businesses are a fit and making opportunities easier to find could help more owners recognize procurement as a realistic path to growth. More broadly, improving owners’ awareness and understanding of these pathways may help more businesses move from not engaging to actively participating.
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Acknowledgments
This report was funded with the support of JPMorganChase and the Ewing Marion Kauffman Foundation. The views expressed are those of the author and should not be attributed to JPMorganChase or Ewing Marion Kauffman Foundation.
[1] Ownership status is based on respondents’ primary work arrangement over the past 30 days. “Mostly employee with other arrangements” refers to those who primarily work as employees but also report additional income-generating activities such as business ownership or freelance work. “Self-employed” refers to individuals who primarily provide services directly to clients as independent contractors, consultants or freelancers. “Non-employer owners” operate a business or income-generating asset but do not employ others. “Owner-employers” operate a business and employ at least one other person.
