According to INE's flash estimate, Portugal's GDP grew by 1.9% in 2025, ahead of the euro area's 1.3%. In its December 2025 Economic Bulletin, Banco de Portugal projected growth of 2.3% for 2026. That is good news, but it is not a plan. Over my years of coaching I have seen many businesses build next year's budget from last year's figures plus a percentage picked by eye. That works while the market is helping. It stops working the day the market changes direction.
We are well into 2026, which makes this the right moment to start thinking about 2027. Not to predict the future, but to decide with data and to prepare responses for more than one scenario.
What the official figures say
Start with the macroeconomic picture, with the sources and the years they refer to:
- Growth: GDP up 1.9% in 2025 (INE) and a projection of 2.3% for 2026 (Banco de Portugal, December 2025).
- Employment: average unemployment of 6.0% in 2025, the lowest since 2011, and 5.6% in December 2025 (INE).
- Prices: inflation of 2.3% in 2025 (PORDATA).
- Trade: up to November 2025, goods exports grew by only 0.6% while imports rose 4.3% (INE).
- Labour cost: a minimum wage of 870 euros in 2025 and 920 euros in 2026 (PORDATA).
Read together, these figures tell an SME three things. Domestic demand has been driving the economy. Hiring remains hard, because few people are available. And costs, wages in particular, are rising faster than many selling prices.
The 2026 signals you should not ignore
Informa D&B data adds an important nuance. 2025 saw a 20 year record in company formation, with 53,030 new businesses. Yet in 2026, up to July, new incorporations fell 4.2% to around 32,300, and insolvencies rose 5%, with 1,216 new proceedings. Informa D&B itself describes a slowdown since the start of 2026.
This is not an alarm. It is a signal that the cycle may be turning, and that a 2027 plan needs room to manoeuvre. A business that plans only for the optimistic case has no answer when the optimistic case fails to arrive.
Three scenarios instead of one number
Instead of a budget with a single revenue figure, I ask owners to build three scenarios. Picture a distribution business with 15 people that turned over 2 million euros in 2026:
- Base case: growth in line with the company's own track record. Say, 2.1 million in 2027.
- Cautious case: flat revenue at 2 million, with higher wage costs. What do I cut, postpone or renegotiate?
- Growth case: 2.3 million, driven by a new product or market. What must I have ready (people, stock, cash) to take advantage of it?
The figures are hypothetical, but the method is real. For each scenario, define the triggers in advance: which indicator, in which month, tells me I am entering this scenario? It might be the order book, the number of quote requests or average debtor days. The point is to decide today, calmly, what you would otherwise have to decide later under pressure.
Turning macroeconomics into business decisions
Pricing
With inflation at 2.3% in 2025 and a minimum wage that went from 870 to 920 euros, a business that does not review prices in 2027 is, in practice, accepting a thinner margin. A price review should be a planned decision, with a date and prepared communication, not a late reaction.
People
With unemployment at 6.0% in 2025, recruitment takes longer. If the growth case requires two more people in the second half of 2027, the hiring process has to start in the first half.
Markets
Goods exports growing by only 0.6% up to November 2025 is a warning for anyone relying on a single foreign market. It is also a prompt to ask where your 2027 customers are, and whether your current customer base is too concentrated.
Cash
In a year when insolvencies have started rising again, cash is the first line of defence. Plan the month by month schedule of receipts and payments, not just the profit and loss account.
A five step planning process
- Step 1: close out the 2026 numbers honestly, including margin by business line.
- Step 2: read the external data (INE, Banco de Portugal, PORDATA, Informa D&B) and write half a page on what it means for your sector.
- Step 3: build the three scenarios and the triggers for each one.
- Step 4: set no more than five annual objectives, each with an indicator, an owner and a starting value.
- Step 5: split the year into four 90 day cycles, with a formal review at the end of each.
Step 5 is the one most often missing. An annual plan reviewed only in December is a document. A plan reviewed every 90 days is a management tool. That is the thinking behind our 90 Day Planning Workshop: turning annual strategy into quarterly commitments the team can deliver and measure.
One action for this week
Write down your three scenarios for 2027 with a single number each: revenue. Next to each one, note the indicator that would tell you, by March 2027, that you are in that scenario. It should take no more than 30 minutes, and you will already have a better starting point than most of the budgets I see.
If you would like to build your 2027 plan with your team, in a structured way and with support throughout the year, the ActionCOACH Porto team is happy to have a conversation. Our Clarity and Alignment and 90 Day Planning workshops were designed for exactly this point in the year.