E-commerce Success Factors for SMEs

This assignment delves into the crucial factors influencing the success of e-commerce ventures within small and medium-sized companies. It scrutinizes elements like effective marketing strategies, secure payment gateways, user-friendly website design, customer relationship management, and the impact of financial stability on achieving sustainable growth. The assignment also investigates the role of innovation in adapting to evolving market trends and leveraging technology for competitive advantage.

SMALL BUSINESS
ENTERPRISE
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TABLE OF CONTENT
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
1.1 Profile of a selected business, Levi Roots.............................................................................3
1.2 Analysis of financial business performance of Levi Roots & Hungry House.......................4
TASK 2............................................................................................................................................5
2.1 Recommend with appropriate actions to overcome the weaknesses.....................................5
2.2 Analysis of ways through which performance can be maintained & strengthened...............7
2.3 Suggest new areas in which the business could expand with reasonable justifications........8
TASK 3............................................................................................................................................9
3.1 Assessment of existing business plans and objectives...........................................................9
3.2 Revision of business plan to incorporate changes...............................................................10
3.3 Action plan to implement changes.......................................................................................10
Task 4.............................................................................................................................................12
4.1 Impact of proposed changes on business and its personnel.................................................12
4.2 The way changes will be managed in business....................................................................12
4.3 Monitoring of improvement in performance.......................................................................13
CONCLUSION..............................................................................................................................14
REFERENCES..............................................................................................................................15
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INTRODUCTION
In UK, small & medium sized enterprises make a significant contribution in the growth &
success of the nation. Organizations that hire less than 250 workers and generate turnover below
50m Euro are called SMEs and contributes in the success & growth of the nation. Dragon Den
UK is a television format that aims at promoting the small and medium sized entrepreneur for
their growth. The present assignment here emphasizes on a SME business named Levi Roots
Reggae Reggae Foods Ltd that offers wide range of BBQ spice sauces to a larger number of
consumers. Along with this, its performance will be compared with its rivalry firm, Hungry
House. Along with this, Levi Roots will be suggested with the best ideas and strategic decisions
to overcome the weaknesses and strengthen its position. In addition to this, its current plans &
business strategies will review and analysed to make appropriate changes and smarter decisions.
Lastly, the reports present a critical analysis of the prospective changes that how it will impact
the company and its personnel. Moreover, a plan will be created how the changes will be
managed in the corporation to bring significant improvement in the business.
TASK 1
1.1 Profile of a selected business, Levi Roots
Name of the business: Levi Roots Raggae Raggae Foods Ltd
Owner structure: Levi Roots is a private limited company by shares which collects funds
through issuing shares to the relative, friends & family members without any public issue. Each
shareholder is liable up to the maximum amount of share capital owned.
History/background: Levit Roots was established in the year 2007 and offers various range of
spicy BBQ sauces to the target consumers. Its success was really impressive because initially,
Duncan Bannatyne said that there was no future for Levi Roots business. But investment worth
50000 GBP by Peter Jones & Richard Farleigh bring a fast forward improvement in its
performance and after just 8 years, Roots success proven Ducan wrong and became a successful
organization.
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Activity: Levi Roots provides number of hot spicy sauces to a great number of audiences in UK,
because it offers its sauce products in all the supermarkets. Moreover, Caribeean flavoured foods
& drinks also satisfying high proportion of population and serving them in the best manner.
Business location: It is located in UK and Raggae Raggae spicy sauces are available in all the
supermarkets of UK. However, on the other side, Roots expanded its coverage to the chilled
ready meals, soft-drink in Caribbean flavour & pasties.
Strengths and weaknesses:
Strengths:
 Wider goods portfolio through offering wide range of BBQ spicy sauces
 Best quality products maximize its competitive strength
 Excellent consumer base as its products are offered in all the UK supermarkets
 Good market reputation & corporate image
Weaknesses:
 Difficulties in collection of long-term funds
 Ineffective control of the mangers on cost
 Poor inventory management & warehousing strategy
 Less skilled & inexperienced staff base
1.2 Analysis of financial business performance of Levi Roots & Hungry House
Hungry House is a competitor of Levi Roots that offer online food delivery to the audiences
and established in the year 2007. It was established with 150 restaurant in 2007 expanded to
2500 till 2010 and has continued to expand operations across various places to serve higher
users. It focuses to expand their restaurant platform across UK to enhance high-yielding audience
base & perform better.
Year
Levi Roots Hungry House
Net profit Turnover Net profit ratio Net profit Turnover Net profit ratio
2012 890 2900 30.69% 720 2360 30.51%
2013 960 3000 32.00% 860 2540 33.86%
2014 1030 4000 25.75% 930 2830 32.86%
2015 1200 4200 28.57% 1280 3340 38.32%
2016 1380 4900 28.16% 1470 4230 34.75%
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As per the profitability ratios, it can be seen that from 2012 to 2014, the net profit ratios
dropped downward from 30.69% to 25.75% indicates that Levi Roots generated lower return on
their total turnover. It may be caused because of adverse trend in aggregate market demand,
exceeding overheads & high cost of inflation (Westerlund, 2017). In contrast to this, in the year
2015, it goes up to 28.57% and then shown a little bit decreased in 2016 to 28.16% demonstrates
that Levi Roots’s performance has been decreased.
In contrast to this, if we look at the competitor’s performance, Hungry House, then it is
founded that its profitability percentage shows a consistent increase. From 2012 to 2015, it goes
up from 30.51% to 38.32% due to better net margin on the total sales made by the company.
Growth in demand & rising attitude towards online food ordering are the main reasons behind
better net yield %age (Halme and Korpela, 2014). However, after this, in 2016, it resulted down
to 34.75% due to less %age change in net earnings than sales maximized; still, comparative
evaluation states that HH’s profit is still reported greater shows that it performed well in
comparison to Levi Roots Raggae Raggae Ltd.
After the performed analysis, it seems clear that Levi Root’s managers need to formulate
various strategies to maximize revenues and control spending. In such regards, turnover can be
improved through following quality assurance policies, expansion, diversification & online
trading as well. In contrast, it can put control over spending through better monitoring &
controlling practices.
TASK 2
2.1 Recommend with appropriate actions to overcome the weaknesses
As per the above analysis, it can be suggested to managers and executives to make better
quality of decisions for the growth of the Levi Root. Here, business can be suggested to use
following strategies for deriving success to the organizations, enumerated underneath:
Strengths (S) Weaknesses (W)
Opportunities SO: WO:
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(O) Online operations, superb quality of
goods & services will be definitely
useful for Levi Root to expand their
audience traffic, revenues &
profitability as well.
By expansion, diversification & online
merchandising, it will be able to reduce
their internal weaknesses such as poor
inventory management & declined
performance
Threats (T) ST:
In this, Levi Roots must use its
strength such as high audience base,
good reputation & best quality goods
& services, it can combat market
threats such as competitive pressure.
TW
Here, cost-control mechanism,
negotiation with the suppliers, close
supervision by the managers on
subordinates will assist the business to
minimize weakness as well as threats.
Quality assurance: Levi Root offers wide range of BBQ sauces to the consumers, therefore;
best quality products is the foremost critical element of its success. Therefore, firm can be
suggested to deliver excellent quality & tasty sauces to its target audiences. In such respect,
freshest ingredients, quality assurance & quality control procedures must be implemented to
satisfy consumers & achieve targets (Squicciarini, 2016).
Training & development programmes: Workers are the important assets of the enterprise as
they interact directly with the consumers and offer goods as per their demand. Therefore, Levi
Root can organize training sessions for their personnel to advance their skills & competencies
(Herbane, 2010). At high staff productivity, firm will be able to serve consumer in the best
possible way and achieve targets.
Expansion strategy: By opening more shops inside and outside UK, Levi root can increase
their globalized presence and generate audience traffic. With the help of expansion, it will be
able to serve more audiences and maximize turnover & net return to a major extent.
Controlling overheads: In order to maximize net earnings, Levi Root’s managers not only
require maximizing sales but they also require putting better control over overheads &
expenditures (Ellis, 2016). Closure supervision and monitoring by the departmental heads over
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their subordinates & promoting saving and curtailment of wasteful spending will bring
significant growth in net earnings and enhance performance
Promotional plan: Now-a-days, marketing activities also plays a crucial role in the success of
an organization. Levi Root’s marketing manager must put attention towards their advertisement,
marketing & other promotional strategies and in order to make it more effective, firm can be
suggested to incorporate social media marketing (SMM) (Choshin and Ghaffari, 2017). It is
because, in UK, high levels of people are web users. Therefore, by website & online marketing,
firm can maximize their audience crowd.
2.2 Analysis of ways through which performance can be maintained & strengthened
Here, Porter’s 5 forces model can be used to make comparative evaluation & analysis for Levi
Roots, narrated below:
Bargaining power of suppliers: Suppliers bargaining power is low because there are
wide ranges of suppliers from whom Levi Roots can buy material for the delivery of BBQ
sauces.
Bargaining power of buyers: As company offer their goods & services at all the
supermarkets in UK therefore, buyers has less power to bargain the prices (Ebert and et.al.,
2014).
Competitors’ rivalry: There are several competitors from whom Levi Roots faces
competition such as Hungry House, therefore, it can be stated that competitors rivalry is high for
Levi Roots.
Threats of substitutes: There are less threats of substitute because although there are
number of firms who deliver hot sauces, still its unique and tasty sauces and Caribbean flavoured
foods & drinks offer greater value to their users (Herbane, 2010). Therefore, they demand only
Levi Roots offerings to satisfy their wants.
Threats of new entry: Any firm can enter or exit from the market without too much legal
formalities. Therefore, the entry threats for the business, Levi Roots are very high.
Taking into account the 5 forces model, company can be recommended with the
following strategies to maintain and strengthen their competitiveness, mentioned below:
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Diversification strategies: Currently, Levi Roots just offer food category items & services to
the consumers, therefore, it can successful strengthen their competitive advantage through
diversifying their regular operations in other non-category food items.
Online trading: Levi Roots can start online trading activities through creating their own
website and through this, it can easily expand their operations inside and outside UK and attract
high-yielding consumers (Cole and Sokolyk, 2016). With this, it will be able to maximize their
competitiveness and outperform over rivalries, like Hungry House.
Better consumer engagement: In order to boost loyalty among consumers, firm can be
suggested to create effective communication with the users and thereby strengthen their
relationship. Customer Relationship Management (CRM) is the best way to establish regular
communication with the audiences and solicits feedbacks also to resolve their complaints result
in high loyalty.
Technological advancement: Now-a-days, latest technological use is of key importance for
improving competitiveness of the firm. Here, modern techniques like web 2.0 technology, social-
media marketing and others are the best way to enlarge customer traffic and thereby drive larger
yield.
2.3 Suggest new areas in which the business could expand with reasonable justifications
In the current times, expansion strategies are really important to expand operations overseas in
order to gain traffic and maximize sales and net earnings. With the stated scenario, Levi Roots
can use following techniques for the prospective expansion stated here as under:
New product development: The best strategy for the prospective expansion for the
entrepreneur is to develop new variety of goods & services to deliver more range of products to
the audiences (Cassar, Ittner and Cavalluzzo, 2015). Here, as now, it deliver only hot sauces,
food & drinks, therefore, now, it can enter into non food and beverage category items for the
diversification. It is suggested because now, user prefers to wish all variety of items under a
single roof, therefore, by rendering wide range of goods & services, Levi Roots can expand their
market through gaining more attention of the users.
Expansion strategy: In this, it can geographically expand their regular course of activities and
functions through opening more outlets inside and outside UK. With this, it will be able to grab
the benefits of market opportunities and expand their market shares to a significant level
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(Choshin and Ghaffari, 2017). This strategy will increase crowd of audience and maximize total
turnover and net yield as well.
Online trading initiatives: For the possible expansion plan, it can also trade internationally
through online delivery of goods. Here, website creation through user specific content by
adopting web 2.0 technologies is considered as the best one for the possible growth and success
of the business.
TASK 3
3.1 Assessment of existing business plans and objectives
Objectives are defined as those plans of an organisation that are stipulated to achieve in
both the short and long run of business. It is however requisite for the associated businesses to
set definite objectives that are in accordance to their envisioned missions. It is also required to be
fulfilled in a goal directed manner in order to carry out the needful actions and efforts. The
assessment in regard to specify the existent business plan and undertaken objectives of Levi
Roots are as mentioned below:
Assessment of business plan
Every business strategy initiates with the principle procedure of setting up their goals
where it has been perceived that Levi Roots has undertaken varied short term and long term
objectives. It is subsequently establishing the business goals and objectives that are usually
defined by using some strategies by which their stipulated aims can be duly attained on time.
With reference to which, it has been ascertained that this elected food organisation gym has
settled varied operative strategies to accomplish their business aims that requires some sort of
changes in it (Bridge and O'Neill, 2012). Although, there is no such erroneous matter with their
enforced tactics and they have considerably enforced all their undertaken business plans and
strategies with a single scarce implication of monitoring. It is where the monitoring procedure is
referred to be the most important consideration for the continual success of the establishment
where it does not reflect efficiency in their currently applied scheme of Levi Roots. It is basically
with reference to their delivery measures where their carried procedure of serving the clients is
not being monitored and in turn creates several issues. It is thus by evaluating the business plan
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of Levi Roots it has been stated that their applied plan is suitable in nature with certain sort of
changes in it.
Assessment of objectives
The leading objective of Levi Roots is to provide superior food products to the consumers
where they are together aimed at achieving a contending benefit over its existing number of
rivals in the market. This can however be done by increasing the market shares and revenues
with an increased state of profitability with more number of sales. It is therefore on measuring
the business objectives of Levis Roots, an acceptable nature of their objectives have been
determined as per the small size nature of their enterprises (Fritsch, Brixy and Falck, 2006).
However, certain changes are required for a perpetual growth and success in the market with a
special consent of surviving in the long run of business. Moreover, SMART objectives are
hereby referred to be the most considerable tool that is required to be framed while referring to
extend into the markets like London and Manchester, etc. It is however with a measured
approach of securing 5% of market share and gain some new businesses by espousing new
marketing schemes and ensure the attainment of these specified objectives within a year.
3.2 Revision of business plan to incorporate changes
It has been detected that Levi Roots is facing an intense state of competition in the market
where they are required to review their present business plan for to incorporating requisite
changes in it. These variations will not only support them to improve the efficiency of their
proposed services but will together aid them to achieve contending benefits in the market
(Acland and Levy, 2015). Thus, with an analogous reference to it, Levi Roots are hereby
required to frame newer set of objectives with a prime inclusion of Smart goals in it. Wherein,
these should together be measured on regular interval of time with a pivotal aim of
accomplishing them in a best possible manner.
3.3 Action plan to implement changes
The changes that are required to be adapted by Levi Roots depicted a vast nature and they
are thus required to develop some considerable action plans for enforcing the changes.
Furthermore, a changed scheme is also evident to support in varied facets where it will aid their
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workforce in accepting the transformed processes and receiving affirmative outcomes. These
action plans to be implemented for change in Levi Roots are as referred below: Procedures for handling changes- It is depicted to be a foremost stage where it will
hereby tend to explicate the entire process of transformation (Herbane, 2010). In context
to which, Levi Roots is thereby required to create suitable strategy for effectively
enforcing and treating the proposed change. In addition to which, a special team of 10
individuals can be appointed to handle and apply the overall process of revolution in a
likely way. Roles and accountabilities of supporting staff- This has been perceived that the required
changes at the workplace are successful only when the situations are duly accepted by the
workforce with a due contribution of each employee in it. Apart from this, Levi Roots is
required to take care of this fact in which each of their staff members will be equally
affected by this entire course of transformation. The Levi Roots is depicted to be a small
scale organisation where they are not referred to face any major challenges in doing so. It
is however with a prime prospect of assigning distinct set of roles and responsibilities to
each of their staff members. It is where a desired set of role should be allocated to the
personnel’s on the basis of their active proficiencies to acquire best possible outcomes
from the projected transformation. Tools to be implicated– Businesses use varied tools and techniques to bring some
substantial changes in organization (Holsapple, Wang and Wu, 2005). It is thus required
for Levi Root to discover the tools that will be used during the entire procedure of
revolution. In context to which, using suitable tool will result in receiving anticipated
outcomes of variation.
 Monitoring- Levi Roots is also required to define an observing procedure by together
deputing a responsible person for the same to review the success of change. This will in
turn assist in identifying whether the transformation is producing the expected resultants
or not by together deterring any undesirable effect on the delegated employees of Levi
roots and their undertaken activities.
TASK 4
4.1 Impact of proposed changes on business and its personnel
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Impact of the proposed changes can be negative or positive on business and on its
personnel. Levi company need to make changes in its strategies so that it can increase sale and
earn high profit. All the proposed changes help in increasing the productivity and help in
capturing market share. There are various modern tool and technique which company can used
so that organization promote its product and services. Along with this company can also used
social media networking site for marketing its product and services. Now a day large number of
people are using social networking sites so it is effective way for grabbing the attention of
customer and increase sale (Dobbs and Hamilton, 2007.). On the other hand, company can
introduce new technology so that cost of production can be reduced and production can be
increased. On the other hand company can change it objective so that overall business
performance can be improved. The personnel can be affected by changes in business as it will
improve the productivity of business. By implementing the proposed changes company can
deliver high quality services to its customer and also can increase their satisfaction level. In the
organization there is some negative impact of the proposed changes on employee. So company
need to make sure that all the changes which are make in the organization can be easily adopted
by employees (Street and Cameron, 2007). On the other hand services changes help in improving
the quality of product, reduce the cost of production, increase market share and increase the sale
of company.
4.2 The way changes will be managed in business
Changes made at Levi root need to manage within the organization so that overall
productivity can be improved. For this purpose, Manager and workers of organization need to
make sure that all the process of changes can be implementing in effective manner (Halme and
Korpela, 2014). At the time when company implement the changes it is required to continuously
monitor so that all changes can be implemented in systematic manner. There are some impacts
which can be take place the business performance an staff member. Further it is necessary for the
organization to make sure that all changes take place within the organization must be have
positive impact and not have any kind of negative impact. Some time it may happen that
negative changes take place in such condition company need to take action for improving it so
that company productivity not get hampered. In action plan it management need to make changes
in it after a period of time the main objective of the organization can be achieved in time. The
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changes made in company so that profit can be increase and company can gain market share. For
this company need to check and evaluate the performance of each employee. Apart from this it
can be stated if company not regular check the performance of employee then it can reduce the
overall productivity of the organization and increase the cost of production (Cassar, Ittner And
Cavalluzzo, 2015). Levi Company can select team of workers who can manage and implement
all the changes effectively.
4.3 Monitoring of improvement in performance
Monitoring is way to keep eye on regular improvement made in performance and all the
activities and task. In organization it is necessary that all the activities and operation are
continuously monitored so that aims and objective can be achieved on time (Cole and Sokolyk,
2016). Further monitoring help in finding out the problems which are becoming barriers in
achieving the organizational objective, along with monitoring company can identify barrier and
can take action for removing all obstacles further company can used various tools and techniques
so that performance can be improved. Apart from this, whole monitoring process help in
identifying the loop holes and support it from to overcome from it. In addition to this there are
much corrective measure can be quality of work can be improved and company can easily
increase the satisfaction level of customer.
Activity Week 1 Week 2 Week 3 Week 4 Week 5
Developing objective
Making action plan
producing the plan
Performance appraisal tool determined and applied
searching loops holes
Eliminating loop holes
Making improvement in service quality
Monitoring and checking whole process
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CONCLUSION
From the above report it can be concluded that systematic action plan help organization
in overcome from its weakness and threats. There are many opportunities company have which
help in expanding its business in all over the world. Further there are different ways which help
organization in managing its existing performance such as regular training and development
program help in increasing the knowledge of individual. Organization can use high quality
product and services so that it can make innovative product and services for its customer. Further
it can be concluding that there are different area in which company can expand its business so
that more and more people use its product and services. Company can advertise its product and
services on different social networking sites so that it many new people can be aware of product
and services which are sold by organization. Organization can formulate effective strategy on
the basis of its goal and objective. There are various changes which are proposed by the
organization and it has some positive and negative impact. Company can introduce the different
technique which is effective in the organization. all the proposed changes have positive impact
that is increase in productivity, increase in sale and increase in overall profitability of market
share.
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