This sample you will be knowing about:
- Discuss about the Pestle analysis.
- Discuss about the Mckinsey model.
Planning is the process of deciding in advance that what is to be done and it help in deciding the course of action effectively. Planning help in gaining competitive advantages which increase the growth in the business (Brinckmann and et., al., 2019). Growth is consider as the important aspect and it is the strategic business activity which help the business to increase the revenue and productivity of the company. The present report is based upon Oak cash & carry which deals in grocery wholesalers company. It was founded in 2011 and head office is located UK. Further this report covers about the advantage of competition which leads to expansion and growth. Along with this, various kind of funds and their implication of the business is explained effectively. The business plan also been executed in this report and the critical evaluation of exit and succession option for the business.
P1 Analyse the key consideration for the evaluation of growth opportunities
For making proper planning and growth company has to indulge in research and development process which aid in identifying the opportunities for improvement. For the organisation it is essential to determine the macro and micro factors of the business environment which can effectively acquire profitability for longer time duration. In the context of Oak cash and Carry management should emphasis on different factor which aid in providing constant growth and development.
Political: This is the factor which include governance, regulation and different policies which constantly effect the business activity of the company. In the country like UK the government is stable as well supportive this provide edge for Oak cash & carry to operate the business activities. Along with this government also provide funding for small companies in order to improve the positioning of the company(Baran, P.A., 2019). Due to BREXIT the business has got effected which aims to slow down revenue as well as sales of the firm.
Economical: This factor include fiscal policy, inflation rate and per capital income of the country. The GDP of UK is developing which provide competitive advantage for SME company like Oak cash & carry to sustain for the longer time duration(Lamker and et., al., 2019). In order to minimize the inflation rate organisation must implement new policies and trends which help in making effective decision for the company for betterment. The economical condition is favorable in UK which aid in promoting business and attracting more and more customer in well define manner.
Social: This component include customer age, gender and income of the particular nation. In this present the taste and preferences are changing day by day so in this case company has to act effectively towards changing environment (Brugère and et., al., 2019). In the context of Oak cash & carry manager should identify the needs and wants of the people which aid in reducing risk and uncertainty present in the market. Company has to deliver product and services as per the changing trends in order to capture large market share.
Technological: This is consider most essential aspect for the company to meet the technological needs. It include artificial intelligence and robotics which is used to improve the efficacious in work along with maintaining demand supply. For small and medium company it is difficult to use such big technology so in this case Oak cash and Carry can take help of government for expansion and growth of the company. Further company use advertisement and promotion strategies for gaining customer attention(Sarin, 2019).
Environmental: This has been recently focused as nation are worried about the environmental issue create by organisation. This factor include carbon emission, waste and pollution. So company like Oak cash and Carry ltd to focus on reducing the waste which help in creating brand image in the minds of customer(Perloff and Wingo 2019). In UK there are different rules and regulations are made which use to handle all these activities and also provide protection to environment.
Legal: It include various kinds of laws and regulation which is made for the proper functioning of the company (Hunt and DeVries 2019). This is also provide to avoid unethical practices done by the organisation. Along with this also provide protection to employees and their rights in effectively manner. In the context of Oak cash & carry to follow all the rules and regulation which assist growth and sustainability for the company.
Pestle analysis is essential tool which is used by the organisation to understand the external environment and make changes for improving market and to maintain constant growth. In order to identify the solution for the internal environment organisation can use Porters generic five forces model which is given below:
Cost leadership: In this leadership the firm set out to become the low cost producer of the product for the company. The source of cost advantage is varied from organisation to organisation and depend upon the structure on which activities are carried forward. For the Oak cash and carry management should keep there pricing policies low for the initial stage as this aid in capturing large market share with exponential growth. Entity should also focus on economies of scale, proprietary technology and preferential access to raw material. The company can achieve and sustain overall cost leadership which help in maintaining price for the longer time duration.
Differentiation: In this firm usually seeks seek to be unique and different from other rivals present in marketplace. For Oak cash & carry ltd management should focus on making product more effectively which ultimately leads towards expansion(Li and Yeh, 2020). Firm has to select more than one attributes which many buyers in an industry preserve as most important factor for gaining success. The company can make differences by identifying the demand and need of end user and offer the services for making better product and services. Order assignment help from our experts!
Strategy: This is consider as the plan which firm use to develop to create competitive advantages in order to succeed in the market (Brugère and et., al., 2019). For Oak cash & carry management should create effective strategies with the help of reinforced strong vision, mission and and the value. This is difficult for the company to maintain the system for smooth functioning of the company.
Structure: It represent the business division and the units which are organized and include different information in which operational activities take place. This is crucial for the company to maintain proper structure which leads towards maximum output from the employees(Portugal, Hernández, and Lugo, 2020). Oak cash & carry administration should create proper hierarchy for easy flow of information in a well define.
System: This include process and procedure of the company which help in revealing the business daily activities and how the decision are made. This are the area where the firm determines how business is done (Samper, Eldali and Suryanarayanan 2019). The top management of Oak cash & carry to develop efficacious method by analyzing the system closely as this improve growth and sustainability of the company.
Skills: These are the abilities that employees should posses in order maximize the productivity and growth (Samper, 2019). Oak cash & carry HR should provide proper training and development program mes for improving the skills for better result.
Staff: This is the element which leads towards growth in the limited time frame (Konvitz, 2020). The main responsibility of HR to maintain the staff and hire employees which add some value to the company. Along with this employees should trained, motivated and rewarded to encourage them to achieve the common goal.
Style: This mainly represent the way how company is manged by the top level managers and how the interact with there employees(Seo, and Cho 2020). For the company like Oak cash & carry to should develop management style which employees should follow for expansion.
Shared values: The shared values are the commonly accepted standards and norm in the company which influence and temper the individual behavior of the entire staff as well as management (Ahmed, 2019). Oak cash & carry ltd administration has to share firm core values among the employees for better planning and growth.
P2 Evaluate the opportunities and applying Ansoff growth vector matrix
This model describe about the growth and development model which is created by H. Igor Ansoff. There are different kind of expansion strategies through which firm can get better position in the market (Fasbender and et., al., 2019). It is also essential to maintain the constant growth by developing new product and services to end user. Further this matrix shows four strategies which is used to help the firm grow and expand but also provide insight about the risk associated with each and every strategy.
Market penetration: In the market strategy firm uses the products with the existing market. In other words, organisation aims to expand the business with the assistance of penetration method. In order to find exposure Oak cash & carry should decrease the price to attract the existing new customer. Along with this company can use different promotion and advertisement method which help in increasing untapped market effectively(Capello and Nijkamp 2019). Acquiring a rival in the same marketplace is essential for the company to sustain for the longer time period. These is not only used by the company by the different industry worldwide. Market penetration for organization is typically expressed as a part, meaning the company's good symbolize a certain proportion of the total market for those products. Get Academic Writing Services from our experts!
Product-development: In this strategy the firms develop a new product to cater in the existing market. This typically involves extensive research and development of product which create value for the company effectively. In regards of Oak cash & carry this is essential for focus on improving the product so to create brand image in the market. However entity must conduct research and development for the new product to cater the present market. Apart from this firm should use strategic partnership to gain access in distribution channel or brand. As to overcome such market organisation management have to focus on achieving desire aims in the well define manner(Fabos, 2019). There must be constant innovation done the firm as this avoid the risk from the rival to some extent. This kind of strategy bring success and also help in developing sustainable business model for long run.
Market development: In market development firm enters in the new market with the existing product. For expanding into new market which means expanding the business into different segments, region. In the context of Oak cash & carry manager should utilize this strategy by creating awareness about the existing product . Beside this company can also enter in domestic market which include local shops and regional vendors for expansion and growth. Entering into global market is important step for market development exponentially(Fasbender and et., al., 2019). Apart from this firm have to indulge in proper research and development and figure out the trends which is beneficial and help to overcome all the problems. This also provide satisfactory service to consumer.
Diversification: In this stage firm enters in the market with completely new product as it is also consider as the risky step for small and medium organisation. For proper implication company have to conduct proper product and development process. This is essential for the company to diversify the product as this provide maximum service to the company. It has the high risk involvement in the organisation which leads towards unpredictable future.
From the above information, it is analyzed that the management of Oak cash & carry must adopt product development method which improve the market and its productivity for expansion and growth. With assistance of product-development manager can able to create the value and brand image for the company.
P3 Potential sources for raising finance and their implications to the business
Business often needs to raise external funding or the capital funding , to expand the business into new market or the location to invest in research and development. And the company aims to use profit from ongoing business operation to fund such kind of projects. The funds are consider as the most essential elements for SME company to expand the business and explore the untapped marketplace. There different kind of sources present in the market and company may choose the best possible for expansion and growth.
This is the loan which is given by bank to small enterprise for expanding there business activities and promote product to the larger audience. The bank provide loan on the basis of assets. This important for the company like Oak cash & carry must avail loan for the bank as it is consider as easy and most efficient mode of getting loan (Rojas and et.,al., 2019). There are different ways through which company can use proper method to avail such loan from work.
Benefits: The bank provide loan at the low interest which become beneficial for the company to repay the loan in time. The bank personal do not take any kind of ownership position of the company and do not get involve in any kind of business activity. This mean company get full control over the business with no external interference. Compare this with equity finance, where the company may be paying out dividends to shareholders for as along as the business exists(Hamel, Mancebo, and Hamel 2019). Once the company take loan from the bank and pay off the amount as per the given time frame so this tend to increase the balance score card of the firm. This mean firm can gain extra benefits for loan which they are going to avail in future.
Drawbacks: One of the greatest disadvantage of bank loan it is very difficult for the to avail loan for SME organisation. The bank are careful to lend the money to that business who can repay the loan on time. Business borrowers can be needful to provide private guarantees, which means that the borrower's individual assets can be seized in the event the business fails and is unable to repay all or part of a loan. Apart from this firm requires to charge high interest rate which increase the cost and slow down the revenue for the company.
These are the investors who provide financial support to small companies to expand the business. This is done on the basis of exchange for ownership equity in the company. Often, angel investors are found among an entrepreneur's family and friends (Baran, 2019). The funds that angel investors provide may be a one-time investment to help the business get off the ground or an ongoing injection to support and carry the company through its difficult early stages.
Benefits: The Angel investors are willing to take risk and they easily provide loan to different SME companies for further expansion. On the other hand angel investors provide flexible option of repayment which help in making easy for the company to expand the