Planning for Growth: Evaluating Key Considerations and Funding Sources for Airdri

This report discusses growth planning for Airdri, a UK-based hand dryer manufacturer. It evaluates key considerations for growth opportunities in the market, applies Ansoff growth vector matrix, and discusses possible sources of funding with their drawbacks and benefits. The report also includes a plan for business growth and succession options for competitive advantage.

Planning For Growth

Table of Contents
INTRODUCTION ..........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Evaluate some key considerations to analyse growth opportunities in market.................1
P2 Analyse opportunity to growth by applying Ansoff growth vector matrix.......................3
TASK 2............................................................................................................................................4
P3 Discuss possible sources of funding for the business with drawbacks and benefits of each
selected source........................................................................................................................4
TASK 3............................................................................................................................................7
P4 Develop a plan for business growth which consist financial data and strategic objectives
for scaling up a business ........................................................................................................7
P5 To explain benefits and drawbacks, assess exit or succession option ............................10
CONCLUSION .............................................................................................................................11
REFERENCES .............................................................................................................................12
Books and Journals ..............................................................................................................12

INTRODUCTION
Planning for growth is a important aspect for every organisation, this is a
considerable strategy for every business to plan and record the planning in order to expand the
business and try to make maximum possible profit from it. Growth planning helps the business to
bring innovative and unique ideas and implement the ideas in effective manner by adapting
significant changes when need. It is important for a flourishing business to bring changes along
with time by keeping in mind; the needs and demands raised by the customers. The company
taken for this report is Airdri, this is a UK-based company which manufacture hand dryer. This
report will cover discussion about various strategies to promote growth in business (Mazzarol
and Reboud, 2020). It includes business plan and succession option in order to get competitive
advantage in the market.
TASK 1
P1 Evaluate some key considerations to analyse growth opportunities in market.
In competitive business environment every organisation tends to make high profit ratio to
sustain and grow in market. In business; firm or organisation is a service provider and customer
is a service user. SME company needs to be evaluated by considering various dimensions for
growth opportunities. In context to Airdri, it is important for the organisation to analyse the
internal and external environment of the market to understand and grab the opportunity to grow
(Sparkman, 2018). Marketing manager of Airdri tends to examine for market opportunity with
the help of GE nad BCG matrix, which are discussed below-
Bostan consultancy group matrix
BCG matrix is helpful for long term planning over strategies and give knowledge about
high and low performance of the service or product which depends on market share and market
growth of company. By using the approach of Bostan matrix one can identify the potential of the
product. BCG matrix is considered to have four associated quadrants which are mention below
as;
Star product: These are the products which are highly demanded by customers,
contribute in attaining high share and high growth in market. In reference to Airdri, star products
are the range of dryers which give high sales and earn maximum profit in relevant market and
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help company to increase its market value and share. Airdri mainly focus to provide high quality
products to their customers to sustain and attract customers by increasing sale.
Cash cows: This is on of the BCG quadrant includes the product which helps the
company to maintain high market share but comparatively low growth in market. In reference to
Airdri, the products which are having high market share even with lowest in built innovation are
included in this section. By investing more and modify product to make it innovative can
increase its demand remarkably and converted into a star product to enhance its growth in the
market (Awode, 2020).
Question mark: These are the products which include those services and goods which
stand in the position of having low market share but having high growth in the market. In
reference to Airdri, the products which have been designed innovatively and considered to be
new invention but still unable to capture and attract big market are considered as question mark
product. In order to convert a question product into a star product Airdri is required to promote
their product by giving offers to make people aware and increase popularity of product which
may help in increasing market share of product.
Dogs: This quadrant contains the product which are having low share in the market and
are not supposed to give a considered growth in future as well. In reference to Airdri the
company tends to divest from such products and plans to make more profit by investing in cash
cow and star product.
GE matrix: This matrix is also known as nine grid cell matrix. It exclusively depends on
business units and product attractiveness. In Airdri this matrix can be helpful in analysing the
attractiveness of the business unit and relevant industry (Liguori, and Pittz, 2020). GE matrix is
mentioned below-
Invest/grow: Under this section, height gained by the product and industry attractiveness
is observed. In reference to Airdri this quadrant supposed to indulge those products which are
having high demand and attract more customers, so these products are considered to be effective
to make more investment in order to capture market.
Hold/ selective: This cell involves question mark product which shows that the product is
able to attain high attraction but unable to hold market. In order to make a strong hold to the
market and make it fall into category of star product the company needs to make more
investment and focus on product to make it innovative.
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Harvest/divest: This quadrant focus on poor performance units of business which are
unable to maintain attraction in the marketplace. In reference to Airdri; this grid includes the dog
products of BCG matrix. It is important for company to stop making investments in this segment
instead should invest in another deserving segment to promote growth (Trivedi, Trivedi and
Goswami, 2018).
P2 Analyse opportunity to growth by applying Ansoff growth vector matrix.
The Ansoff growth vector matrix is known as market growth matrix, a tool that can be
used for analysing and investing strategy to promote business growth.
Market penetration: Market penetration is a effective strategy prefer by many
organisations to enhance their growth in existing market with current products. In this strategy
company manager plans to penetrate their product in market by lowering prices, to increase
market share and boost up the profit. In reference to Airdri, the manager make many strategies
to penetrate market like promotional activities, advertisement, low prices, with the intention to
capture large market size and attract customers by making offerings.
Product development: Through this strategy organisations plan to introduce a new
product in the same market. Under this strategy, the companies gather appropriate knowledge
and research about needs and demands of the customer. Then introduce new product accordingly
to meet customer expectations and try to fulfil their satisfaction. With context of Airdri
marketing manager have as new design of developing new products such as portable hair dryer
or hand dryer to make the appliances handy and easy to carry. In current times, customer's love
to buy compact, portable, and less space utility things so Airdri's planning to develop portable
appliances can gain a big popularity in market and attract target customer to buy product and
help company to earn profit (Kowo, and Akinbola, 2019).
Market development: This is a market expansion strategy adopted by those companies
which plans to enter a new market in order to grab opportunity to expand the business in
different locality. In this strategy company plans to enter new market with existing product in
order to sustain in competitive market by making high revenue by attracting large audience. Any
organisation before introducing their business into a new locality; first research the market place
to analyse the demands and needs of the customers, evaluate demographic areas, preferences,
number of rivals, etc. in a particular market. Marketing manager of Airdri evaluated various
factors associated to the market to apply correct strategy for market development and expansion
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in effective way. Airdri can enter in a market where large proportion of customers demands for
manufactured hand dryers.
Diversification: This strategy relates to the organisations who plans to diversify their
business that is, deal in those market where they have not been catered before. Diversification are
of two types; one is related and another one is unrelated diversification. In related diversification,
business enter new market by introducing new product but deal in existing industry (Kitsios and
Kamariotou, 2021). While in unrelated diversification, business introduce new product into a
new market in a different industry. This strategy adopted by companies to capture new market by
introducing new product. In reference to Airdri the company plans to enter in a new market along
with some new products including, Air purifier or vacuum cleaner. Strategy of diversification
helps company to attract new customer base, increase market share and generate more revenue to
promote business growth. For diversification, prevailing market need to be research to know
about the needs of the customers in particular area.
After discussing many strategies it is concluded that market development strategy is
adopted by Airdri as their growth strategy. Under this, company plans to enter into a new market
of UK with current products. Airdri marketing manager research the market and try to identify
for the rate of demand of the product in prevailing market and introduce their product where
demand is at peak. Through this Airdri able to capture and sustain the new market (Kitsios and
Kamariotou, 2018).
TASK 2
P3 Discuss possible sources of funding for the business with drawbacks and benefits of each
selected source.
Organisations needs sufficient funds to start and manage their working and keep growing
in a business sector. Shortage of funding is the major problem faced by many companies which
create many complexities and impacts the growth of the business. It is important to have
appropriate flow of money in order to run business smoothly without face any shortage. For
Airdri can opt for any one of the source of funding to avail sufficient amount of capital for their
market expansion are mentioned below-
Internal financial source:
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This is the method of raising fund in which funds are provided from the internal source of
the business but this source concerns with lesser risk. Internal sources includes generated capital
from cash sales, sale of fixed assets, investment made from already earned profits, etc. In
preferring internal financial source Airdri may have some merits and demerits which are
discussed below-
Advantages Disadvantages
 With this option; Airdri will have all
the rights to perpetuate and upholds all
the power of the business .
 This source assist company to make a
good will and help in planning for the
process accordingly.
 This method assist Airdri to reduce
total cost on overall project
(Bhattacharya, 2018).
 It provides Airdri a safeguard from
losing ownership by not alooing any
interference from any external force.
 It can holds the availability of routine
cash need in reference to Airdri
business.
 For Airdri, possibility of bankruptcy
increases due to lack of funds to pay to
the creditors.
 This may result in causing stay to
department due to lack of money. As all
the available money is invested in
following the strategy of market
expansion.
 No taxation rebate will be provided.
External Financial source: This source related with generation of funds by considering other
extrinsic operations. Airdri can choose external financing source to arrange funds, which helps
the company in market expansion by availing sufficient cash to run operations smoothly. Several
methods of external financing are discussed below:
Bank loan: Bank loan is a source in which an agreement is signed by two parties that is,
one who lends the money and another one who borrow the money on the basis of some terms and
conditions. In reference to Airdri, by opting for this source; organisation have to bear some
advantages and disadvantages mentioned below-
Advantages Disadvantages
 Bank loan is a trustworthy and
inexpensive method to opt for finance.
 This method is risky as bank loan is
secured with some asset of Airdri so
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 This method is comparatively flexible
and can Airdri to loan a large amount of
money that have to pay in installments.
 Bank does not interrupt for any
function and Aidri is free to use money
in the area wherever they want to
(Kurochkina and et. al., 2019).
failure to repay the amount can be
riskier.
 Terms and conditions implemented by
banks are so strict and inflexible that
company has pay amount in instalment
immediately after loan has been passed
irrespective of the usage of financed
money by Airdyi.
 In situation of improper cash flow,
Airdri would not be able to pay
installments to the banks on time.
Crowd funding: Under this method; funds are raised from crowd by demanding
assistance for the newly established business in which social media plays a role of a mediator.
There are many websites which provide crowd funding for new venture and promote
entrepreneurial skills. Some advantages and disadvantages which are analysed in case of crowd
funding loan in Airdri are discussed below-
Advantages Disadvantages
 It is a funding source in which less
processing cost and less efforts apply.
 This force generally obtained by those
investors who shows interest in service
or products offered by the company.
Through investing in this, Investor
become the client of the Airdri for a
long period of time.
 This method is not easy to obtain, only
in conditions when service or product is
unique and innovative and have the
expectations to prevail market needs
then only it become possible to obtain
crowd funding.
 The good will of the company may get
influenced negatively if product is not
bale to meet the expectations of clients
for which they raised the funds.
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Angel investors: This is the source of funding in which funds are raised by individuals
who holds the large net values in the market to support small start ups. Angel investor provide
single time investment, to cover all the required financial support that a start up needs in their
initial time. By opting this investment method, Airdri may come up with some disadvantages and
advantages; are discussed below-
Advantages Disadvantages
 This method does not involve asset
mortgage so no risks are associated
with this method.
 In case of business get successful or
unsuccessful, there is no burden to
repay the amount of loan to investors.
As they demand for a part of profit
from organisation.
 This method is not suitable for small
scale business at it involves huge
investment.
 It is not easy for Airdri to get an Angel
Investor which may create a trouble.
 Airdri will be in danger to loose
ownership of their business.
Airdri is recommended to opt bank loan to get support for market expansion within UK.
And for financial support, Airdri should select bank loan method as company is sufficiently
capable to pay bank loan investments. Bank loan will assist Airdri to expand business withput
any interference.
TASK 3
P4 Develop a plan for business growth which consist financial data and strategic objectives for
scaling up a business
A business plan is develop with the purpose to organise all the business activities to
achieve the aims and objectives. Business plan comprises with all the functional and strategic
activities for expansion and growth of the organisation. It also help to prepare a budget to get
financial resources to access the organisational activities. Business plan is very necessary for the
growth and expansion of the company as it helps to develop strategies to access all the activities
effectively (Drover and et. al., 2017).
Executive summary: Airdi is an organisation which is famous for hand dryer with
advanced technologies. It was established in 1974 in UK. It was founded by Peter Philipps and
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Peter Allen. Both the founders were engineers by their profession. The company is
manufacturing very exclusive hand dryers with advanced technologies in order to attract
customer to earn profit. Company always introduce hand dryers according to the needs of
customers. Company modifies products to meet with the requirements of the customers. The
company is offering seven different range of exclusive hand dryers like Quartz, Quantum, Quad,
Quote, Quest, Quazar, Quarto and Quantum. After introducing such exclusive products
company is about to expand the business to all the markets of UK to increase the productivity
with the purpose to make profit (Yanuardani and et. al., 2016).
Vision: Organisation is about to expand the business to order to increase the number of
customers as company can make the products available on a large scale for customers. Company
is all set to launch its products on a large scale.
Mission: Mission of the organisation is to introduce some new outlets in different
markets of the country where they do not have shops with the purpose to increase the
approachability of the service users.
Goals: Organisation wants to introduce standardised products to enhance the sales which
can assist organisation to sustain for a long time. Increasing the sales is also beneficial with the
aspect of earning profit (Pratono, Ratih and Arshad, 2018).
Objective:
Airdri is developing smart plans to expand their business:
S- Specific: In order to increase the goodwill, organisation is planning customer value and sale
of the company.
M- Measurable: The company wants to increase its sale by 15%. Organisation also want to
increase customer base by 205.
A- Attainable: The company provides organisational training to the workers who do not have
experience so they can meet with the organisational goals.
R- Relevancy: Airdri will capable to increase the goodwill after achieving the aim and goals.
T –Time bound: The company has also the time boundaries to accomplish its goals. Company
wants to achieve its goal by 2022.
STP model: The model is highly applicable to rectify the segment which can make profit for the
company. It is helpful to identify the segment captivating for the business. The model helps
organisation to earn profit with the development of different strategies to full fill the
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requirements of the customers. STP is the model which is highly applicable for the development
of the products and it is also used by Airdri (Peprah, Mensahand Akosah, 2016).
Segmentation: During this stage of STP, the market is separated into two different parts
which consist requirements and quality to meet the demand of the market to make profit. On the
basis of behavioural features and demographic location Airdri can separates these two segments
of the market. The company would make sure that every individual segment need to be analysed
effectively.
Targetting: The company focuses on developing market strategies in local area and will
seek to introduce collaborative venture from construction buildings and owners of malls whoever
required hand dryers. This strategy will assist the company to target the market.
Positioning: Airdri is about to open outlets in which it can introduce some new products
and make products easily available to the customers. This will help to attract the customers in
order to make profit. They can offer the products to the consumers in the new segement with the
help of positioning manner.
Resource allocation: This is very crucial for the company as it contributes for the
growth and development of the company.
Total estimated budget: It is very important to get financial resources which will support the
company to expand its business. It is a important part of business plan and calculate toatl
expenses which is required to access the project.
Particular 31/12/20 (£) 31/12/21 (£) 31/12/22 (£)
Implementing technology cost 11000 11000 12000
Promotional expense 10000 12000 13000
Installation of machines 15000 16000 15000
Shop expense 10000 12000 10000
Training charges 9800 10000 11000
Total Cost 55800 61000 61000
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Cash flow statement: This statement helps in analyse the flow rate of liquid funds associated to a
business which is a factor in evaluating a financial position of the element. It is estimated data of
the investment done by the company to expand its business.
From the above cash flow statement, it has been analysed that Airdri has enough liquid
funds to deal with all the liabilities. It is very helpful for the company to maintain its
sustainability (De Roo and Hillier, 2016).
Monitoring and controlling: To control and execute the market expansion plan the
process of controlling and monitoring is very compulsory to be held effectively. With the
purpose to have control over the upcoming project, the company is using indicator of key
performance to manufacture quality products.
TASK 4
P5 To explain benefits and drawbacks, assess exit or succession option
Succession planning refers to a process in which role of leader and owner is delivered to
other leader of the same organisation. It is high applicable to run the business effectively with
any barrier. Different process of succession planning is mentioned below:
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Acquisition: Acquisition refers to activity which is brought by the organisation by an
another company as full purchase of shares. Acquisition allows company to buy the products
without any approval.
Advantages Disadvantages
 It assist organisation to achieve more
resources in order to get more
competence.
 It helps for fast expansion of the
business in order to make profit.
 It helps to bring innovative ideas with
the introduction of new workforce.
 The cost is very high and sometimes it
leads to loss for the company.
 Cultural and regional conflicts are
caused because the collaboration of two
organisations.
Merger: it is a process by which two organisations work collaboratively to enhance the
efficiency. There are two types of merger including vertical and horizontal. Horizontal merger
combine two organisations with same product where as vertical merger combine two
organisations with different products.
Advantages Disadvantages
 It increases the level of production and
make financial benefits.
 Increases the availability of financial
resources.
 It is very helpful to increase the
customer value and goodwill.
 Merger get decreased because of
repetitive jobs.
 It may promote the monopoly market
due to increased market share.
 Vertical merger promotes negatives
attitudes and hinders goodwill.
CONCLUSION
From the above report, it has been analysed that business plan is very important for the
growth and development of the company. GE and BCG matrix is helpful to recognise growth
opportunities for the company. Ansoff model assist to develop strategies for the development and
growth of the company. Business plan is helpful for budget preparation to identify financial
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resources which support the expansion of the company. It also help to increase the market
sustainability and make profit for the company.
REFERENCES
Books and Journals
Awode, O., 2020. Strategies to grow and expand a nonprofit business (Doctoral dissertation,
Walden University).
Bhattacharya, P., 2018. Aligning enterprise systems capabilities with business strategy: An
extension of the strategic alignment model (SAM) using enterprise
architecture. Procedia computer science, 138, pp.655-662.
D’Ambrosio, M. and Gianfrate, G., 2016. Crowdfunding and Venture Capital: Substitutes or
Complements?. The Journal of Private Equity. 20(1). pp.7-20.
De Roo, G. and Hillier, J., 2016. Complexity and planning: Systems, assemblages and
simulations. Routledge.
Drover, W., Busenitz, L., Matusik, S., Townsend, D., Anglin, A. and Dushnitsky, G., 2017. A
review and road map of entrepreneurial equity financing research: venture capital,
corporate venture capital, angel investment, crowdfunding, and accelerators. Journal of
management. 43(6). pp.1820-1853.
Kitsios, F. and Kamariotou, M., 2018. Business strategy modelling based on enterprise
architecture: A state of the art review. Business Process Management Journal.
Kitsios, F. and Kamariotou, M., 2021. Artificial intelligence and business strategy towards
digital transformation: A research agenda. Sustainability, 13(4), p.2025.
Kowo, S.A. and Akinbola, O.A., 2019. Strategic leadership and sustainability performance of
small and medium enterprises. Ekonomicko-manazerske spektrum, 13(1), pp.38-50.
Kurochkina, A.A., Voronkova, O.V., Lukina, O.V. and Bikezina, T.V., 2019. Management
features of small and medium-sized business enterprises. Revista Espacios, 40(34).
Liguori, E.W. and Pittz, T.G., 2020. Strategies for small business: Surviving and thriving in the
era of COVID-19. Journal of the International Council for Small Business, 1(2), pp.106-
110.
Mazzarol, T. and Reboud, S., 2020. Planning and strategy in the small firm. In Small Business
Management (pp. 95-152). Springer, Singapore.
Peprah, J.A., Mensah, A.O. and Akosah, N.B., 2016. Small and medium sized enterprises
(SMEs) accessibility to public procurement: SMEs entity perspective in Ghana.
European Journal of Business and Social Sciences.4(11). pp.25-40.
Pratono, A.H., Ratih, R.V.S. and Arshad, D., 2018. Does entrepreneurial autonomy foster SME
growth under technological turbulence? The empirical evidence from Indonesia.Journal
of Technology in Behavioral Science. 3(3). pp.170-178.
Sparkman, R., 2018. Strategic workforce planning: Developing optimized talent strategies for
future growth. Kogan Page Publishers.
Trivedi, K., Trivedi, P. and Goswami, V., 2018. Sustainable marketing strategies: Creating
business value by meeting consumer expectation. International Journal of Management,
Economics and Social Sciences (IJMESS), 7(2), pp.186-205.
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Yanuardani, M., 2018. Exploring Talent Management Potential in Digital-Savvy SMEs. The
Indonesian Journal of Development Planning. 2(2). pp.138-151.
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