This assessment will provide certain questions which are like:
- What are the effective competitive advantages in growth in their internal and external factors.
- Elaborate the effective decision making and their business opportunities.
- Make a business plan for Trading scent.
Planning for growth is defined as strategy which helps to plan business for achievement of goals and objectives in appropriate manner (Mitchelmore and Rowley, 2013). This is regarded as strategic businesses which enables owner for tracking organic growth in terms of revenue. It allows enterprise to allocate resources with efforts to adapt changes occur in industry that are driven through competitors and digital disruption. In order to expand business in other place, planning has to be done by enterprise. The given assignment is based on Trading Scents which is small business that deals in manufacturing perfumes, cosmetics, skin products for consumers. It is planning to expand their business through online portal for users. The main aim of report is to discuss about key considerations SME has to consider when evaluating growth opportunities and methods of funding used by business. It has covered business plan and ways that lead business to exit their respective firm from market.
Growth considered as an regular facet which is mainly based on firms and their support they gives towards products for staying in market at certain period of time. In context with Trading Scent, as it is small business which deals with different types of perfumes, beauty care products and so on. The main motive of this business is to satisfy consumer's needs and wants in a perfect mode. For expanding business within UK manager of this firm is needed to have unique plan and services to gain targeted objectives easily (Liepa-Zemeša and Hess, 2016).
It is based on different situation of business which is helpful for firms to increase their growth and huge revenue. Wherein, Trading Scent required to formulates so many strategies and tools to gain huge competition. Some of them elements are given below:
As this respected business has knowledgeable and skilled employees so that they can use availability of resources.
In order to get better quality of goods and services they are able to satisfy its consumer's needs and wants at marketplace. According to the above specified core competencies it has been evaluated that if respective firm or business has liable to apply these sorts of term in business than they also required to face few challenges into the marketplace. Reason being competition is raising day to day that always have impact on firms within positive and negative way. If talk about positive than with the help of these sorts of factors firm is able to achieve their goals via targeting its potential customers. On the other hand, negative side shows if firm do not include these competences in business than they can face many difficulties in regards with fund and resources.
There are some another ways by which this firm can get lots of advantages and able to known overall situation of market analysis by using Porter's generic strategies and PESTLE, those are going to be discussed below:
Porter's Generic Strategy
This model used to analyse specific framework which generally consist so many tools and techniques in order to gain competitive scenario in a perfect manner. This generic strategy model always supports business in order to increase their growth and opportunities perfectly. There are few strategies in reference with this model, those are discussed below:
With the help of this cost strategies it can be said that, fist oh fall firms are needed to have effective goods and services along with they are needed to have better cost strategies by which Trading Scent, is able to satisfy their customers and attract them at high level (Muzzini and Aparicio, 2013).
In order to fix any kind of price on each and every product firm is needed to have better and high class quality of their goods so that they can satisfy consumer's needs. It gives them better ways and able to differentiate their entire goods from another firm. It will increase firm's image positively.
In reference with Trading Scent, this organisation mainly focus on niche market to offer its goods and services at affordable price along with it fulfil firm's needs and wants.
There are different types of competitive advantages which are combines with the scope of several activities in which firm is able to look at their overall goals and objectives along with increase better working performance of employees in an effective manner. By using this model respective business is able to gain competitive scenario and achieve their target effectively.
If firms is not able to analyse all these strategies in front of their customers as well as employees so that they can not meet its targeted goals and sometimes, they can face few issues in the business which is not good for future growth.
It is used by an organisation in order to know about different tools and strategies to gain better knowledge of external environment, discussed below:
Due to this government based factor, Trading Scent is needed to have different types of progress in order to expand their business within UK for this they need to follow different rules and policies which is given by government.
It includes foreign exchange rates, inflation rates and so many competences. Therefore, within UK economy has different rules in which Trading Scent required to enhance growth of business by considering all things.
In order to expand business Trading Scent, need to focus on people life style and country culture as well by which they can bring such product which will influence them and increase firms value.
Within technological advancements there are so many firms are bringing innovative techniques day to day to influence people at market. Herein, Trading Scent is needed to have unique techniques to produce high qualitative goods and services.
In order to expand business within in another country, every country has their own legal rules which should be followed by Trading Scent to gain effective profits.
This is based on environment situation like weather, climate etc., for this respective firm needs to keep their products in safe environment to give better goods for customers.
Therefore, generic strategies and PESTLE analysis used by Trading Scent in order to produce high quality of goods and services in order to gain competitive scenario for betterment of future. Moreover, if respective business firm will use this PESTLE analysis in a perfect manner than, they can easily evaluate different types of rules and regulations which is followed by UK government. With the help of this they can design their overall functions accordingly and able to provide several goods and services in a better way. Using this analysis at right manner will impact positively towards future profits and protect business from unnecessary factors which is not worth for this organisation. Therefore, it is necessary for firm to follow UK government structure in a perfect way to bring more and more innovative ideas in business that encourage firms to target their potential customers. Thus, it will impact on firm positively. On the other hand, sometimes, firms are not able to cope up with government rules and regulation as political factor growth is stable in UK but due to so many changes which is derived from government that directly influence businesses and functions of firm in a negative way.
Ansoff's matrix models provided by H. Igor which involves several responsibilities and guidelines which is followed by managers in order to design numerous strategies of an organisation to maximise business growth. In context with Trading Scent, used by its manager which is discussing below:
It is one of the best process for selling and developing goods and services effectively. With the help of this strategies of this model firms are able to make existing products and target effective market to gain huge profits. Therefore, market penetration considered as a key element of firm which is used to enhance firm's growth. In context with Trading Scent as this company deals with beauty care products and perfumes and wants to expand its business so that they need to focus on its target market along with people to achieve competitive scenario (Földvári, van Leeuwen and Didenko, 2015). Through maintaining its business they need to use unique techniques for giving better goods to customer's.
It includes instant adoption and action of product at marketplace along with it is helpful for firms to gain huge competitions and creation of goodwill which directly impact on business operations in a positive manner.
It mainly includes lower profit margins and there could be possibility to harm firm's product and their goodwill at marketplace as well.
It is most significant strategy in which each and every kind of business needed to have huge fund and techniques to produce numerous goods and services at marketplace. Herein, Trading Scent needs to develop those type of product by which they can influence customers and able to give them unique shape and size to gain great image at market. Therefore they need to adopt some different features and innovative concepts so that they can fulfil consumer's desires in order to grab opportunities into the workplace. Through effective development of goods can create awareness towards customer's mind and encourage to buy. It increases profits and productivity of firm.
The main advantage of this strategy is to keeping pace and providing opportunities by which they can attract large number of businesses and able to increase reputation of business as well within innovative way.
This strategy could be risky or expensive in which consumers already know about new products so that it depends upon their wishes that they want to spend money on that particular goods or not.
Market is rapidly changing due to numerous organisation which plays several role to satisfy customer's needs and wants. Therefore, Trading Scent needed to have more focus on their various strategies and tools by which they can analyse their features towards products and able to gain customer's confidence in an effective manner. For more betterment they should use research tools by which they can reach towards customers and produced goods accordingly. Therefore, it is important aspect for business to run its operations in a smooth manner (Halsmayer, 2017).
It could be possible for firms from this strategy to gain competitive advantages easily along with they are able to increase their business growth within the large economy of scale. So that it increase purchasing power of buyers that make them energetic to achieve goals.
Sometime due to this strategy, firms can face few issues like cash shortage in this they are needed to borrow money from another business along with loss of control in which firms could have delegate duties of management and has to segmented workloads at several locations.
In reference with Trading Scent mainly able to use different types of plan and strategies in order to attract customers at market. So that this strategy of Ansoff's model help firm to increase funding to remove negative effect from firm.
Due to the economic changes, spending money patterns of people changing every day. Whereas, diversification within the product line and firms can easily develop a proper balance and control ups and down into the business. Therefore, it is helpful for firms and businesses to increase the use of available resources.
Diversification within the new market will want new set of skills in which firms are not able to make proper aspect that could be develop more difficulties for firms in a marketplace.
From above mentioned strategies this can be said that if Trading Scent will use assorted strategies in a proper way than they can achieve their targeted goals and objectives in an appropriate manner. Furthermore, there are 2 main strategies which is followed by respective firms that is Market development and market penetration. With the help of these strategies they can easily get to know that in which place they can successfully formed its new goods and services in order to attain profitable goals. By having these type of strategies they can make new rules and policies within marketplace as per the government which will bring more attractiveness and innovative ideas of business to gain more specific objectives. Therefore, firm is required to focus on these 2 aspects in a better way which will make them effective and encourage them towards maximising working performance of employees in a proper mode.
For an organisation it is very much crucial to enlarge business opportunities by raising funds from various sources. In context of Trading scents they by using various tools and techniques access the viability of their projects in proper manner.
Investment Decision Making
Before investing money in any area, it is very much crucial for them to expand their business by using project options that are as follows:
It is one of the most important tool that helps to recover initial cost of investment. It depicts the no. of years would take to gain back the initial investment made during the project.
Net Present Value Calculations
Respective kind of calculations solving after taking the differences in between the present value of cash inflows and cash outflows in a specified time period. It shows the worth of project that an organisation aimed to bring into market in near future. In context of Trading scents by using it gain potential results about balance of inflow and outflows of cash.
Sources of Finance For Growth
There are various sources to achieve growth while taking their business online so that they can reach at large no. of consumers promptly. Here are the various sources to raise funds with their advantages and disadvantages that are as follows:
They are are one of most convenient way of finance to purchase the inventory and equipment as well as operating capital and funds in order to expand business (Muzzini and Aparicio, 2013). In context of Trading scents they with the motive of expand their business can choose way to raise funds. There are some sort of advantages and disadvantages that are as follows:
The major advantage of bank loan as it is temporary in nature as borrower has paid off a loan after that there are not any kind of obligation with the bank lender until borrower wishes take out subsequent loans.
One of the greatest disadvantages of Bank loan that it is very much difficult to achieve until or unless a small business has potential track record such as real estate. As bank are careful to lend money only businesses that possess ability to repay their money.
It is one of most important practice of funding for a project or venture by raising small amount of money from large no. of people by using internet. In context of Trading Scents they can use respective tool after evaluating the advantages and disadvantages of it that are as follows:
The major advantage of respective tool of raising fund that it is one of fast way to raise finance without any kind of up front charges. It is one of best way to verify the public reaction in regards of organisational loyalty.
It is not one of easier process to go through in comparison to the traditional way to raise funds as not all kinds of projects can gain funds from using respective tool or platform.
Angle and Venture Finance
It is one of high net worth individual that provides financial backups for small start-ups or entrepreneurs in exchange of ownership in equity company (Rasoolimanes, Jaafar and Badarulzaman, 2013). In context of Trading Scents they by using respective factor can gain potential resources in order to remain competitive in marketplace.
It is one of less risky than the debt financing to raise funds in order to remain competitive in marketplace.
By using respective source of fund organisation loose its complete control over business works and activities.
In context of Trading Scents they by using bank loan can raise fund to operate online as it has not any kind of obligation after paying debts.
Business plan refers to different types of activities and strategies by which firm is able to make unique plan for further expansion of their business in a proper manner. In order to develop unique business firms are applicable to focus on their guidelines and instructions so that they can guide their all over employees and make them productive for firm. In context with Trading scents as they wants to expand their business in another country so they have so many elements by which they can identify their business goals, those are mentioned below:
Trading scents is one of the best organisation which have large number variety of perfumes and beauty products along with good sales in the market. Now this small business wants to increase its market value at another place to gain good image towards products (Liang and et. al., 2018).
Is to provide high quality of cosmetic products and perfumes in order to satisfying customer's desires.
Is to become world's most favourable brand within consumer's mind through giving them numerous product and services in a perfect manner.
The main value of this firm is to launch more and more beauty products with utilising of natural ingredients to gain unique image in a perfect way.
To increase sales 15% in the coming years through gaining better image at marketplace.
According to this stage Trading scents needed to segments its market and goods on the basis of demographics and psycho graphic that includes age, gender, income to reach customers (Daniels and Lapping, 2016).
After segmenting their market Trading scents target people generally women and girls as they deals with cosmetic products to give them better satisfaction.
At last stage Trading scents cosmetic business able to give their best position of their products and wants to achieve targeted goals.
It has wide product range like it has so many categories of products in different shape, colour and size.
During the e-commerce there are several websites but they are not able to showing any picture and image of respective firm's product.
In the entire world people use so many cosmetic items so that it will give opportunities for this small business to expand their services.
In present scenario there is huge competition between fashionable firms.
Formulation of budget:
Pre launching cash budget for six months, which has been specific beneath:
Post launching cash budget In order to check different types of cash flows and tax payments Trading scents firms able to make this financial statements to survive accordingly into the marketplace.
The success and failure of business depends on strategies adopted by it. Sometime, it happens due to external as well as internal factors. It is essential to analyse each and every components in an effective manner before establishing business at market place. They are as follows:
Exit: Success and Failure
The several ways where owner and manager decide to exit their business from market. This includes loss incurred by business from long time, unable to compete with competitors with their existing products and services and others (Rydin, 2013). It is very important for manager to make proper plan and policies so that they can survive and sustain at marketplace in an effective and efficient manner.
The key reasons i.e. internal as well as external factors for business failure are: ineffective leadership, lack of transparency, personal growth, long lasting value, lack of concrete business systems and so on. The business failure can be prevented through adopting new plans, policies, strategies, hiring skilled manpower, power analysis of market and so on. This helps to get success at marketplace in best possible manner.
There are various types of mechanism for exit in event of failure of business at marketplace. It is important to analyse each and every factor and adopt best option to exit from business. This includes merger and acquisition, liquidation and close, selling to friend and so on.
Some of the exit routes for successful businesses are described below:
Selling or Floating Business
It is defined as exit strategy in which business sell their investment to other (Van Niekerk and et. al., 2016). The floating will affect other existing investors and shareholders in an effective and efficient manner. This helps other business to give access for new capital, increasing public profile and so on. The respective organisation can adopt such route of exit for their business in order to survive and sustain at marketplace.
In this exit strategy, organisation valued their business and sold it at marketplace. After valuing each and every aspects of enterprise they sold to market. It is the easiest exit strategy that can be adopted by business in best possible manner. Trading Scents has to adopt value company exit strategies so that they can sell it at marketplace.
Growth and Succession in The Family Business
Considerations of growth affect family business by doing hard work, professionalising structure, developing strategic plan, innovate, empowering next generation and so on.
Different areas of potential conflict includes leadership conflict, work style differences, culture based dissension, personality clashes and so on. This issues creates problems in running business activities and operations in an effective and efficient manner (Wang and Immergluck, 2015).
Succession planning is defined as procedure to develop and identify new leaders in order to replace old whenever they retire, die or leave organisation. This helps in increasing availability of capable and experienced employees which are prepared for performing such roles in business in proper manner. It is very important for Trading Scents to make proper succession planning for achievement of positive outcomes.
Also read: Crucial Role of Planning in the Company
From the above report, it has concluded that it is very important for organisation to make proper planning for adopting new strategy or expanding business at new place in appropriate manner. SME has to analyse their competitive advantage with helps of various models so that effective planning is made for positive outcomes. They have to grow on continuous basis to accomplish set goals and objectives. In order to expand business, funding method has to be selected and investment decision has to be made. It is very important to make business plan that should contain all relevant components for investment. Business succession and exit depends upon the strategy they have adopted for carrying out their operations and activities in best possible manner. Get more details about assignment help UK from our experts.