Planning for Growth - Analysis of Key Considerations, Growth Opportunities, Funding Sources and Business Plan for Airdri

This report discusses the growth planning strategy for Airdri, a UK based company dealing in manufacturing and supplying of hand dryers. It includes analysis of key considerations for evaluation of growth opportunities, evaluation of growth opportunities with the help of Ansoff growth vector matrix, potential sources of funding along with the benefits and drawbacks of each method, and designing a business plan for growth.

Planning for growth

Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1- Analysis of key considerations for evaluation of growth opportunities................................1
P2- Evaluation of growth opportunities with the help of Ansoff growth vector matrix..............2
M1- Justification of growth alternatives utilising various frameworks to showcase the
competing benefits in context to the organisational scenario......................................................4
D1- Measurement of growth alternatives along with the risks attached......................................4
TASK 2............................................................................................................................................4
P3- Potential sources of funding along with the benefits and drawbacks of the each method....4
M2- Assessment of prospective funding sources.........................................................................7
D2- Evaluation of possible funding options and selection of one as per requirements...............7
TASK 3............................................................................................................................................7
P4 – Designing a business plan for growth..................................................................................7
M3- Elaborated business plan for growth and investment collection........................................10
D3- Producing an in-depth business plan for formulation, application and achievement of
objectives...................................................................................................................................10
TASK 4..........................................................................................................................................10
P5- Assessing of exit and succession options for business operation about the benefits and
drawbacks..................................................................................................................................10
M4- Measurement of exit or succession choices.......................................................................11
D2- Effective judgement for exit or succession alternatives.....................................................12
CONCLUSION .............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Planning for growth is an important aspect for sustainability of each and every business
operation. Growth planning strategy facilitates the planning and recording of strategies related to
planning for growth. These strategies enable the business operation to fulfil their organisational
aims and objectives to be able to deal with competitors. This report highlights the company
Airdri, a UK based company dealing in manufacturing and supplying of hand dryers (Linnik and
et. al., 2020). The discussion also revolves around numerous growth opportunities along with the
implementation of an effective business plan strategy for the organisation to be on a competitive
edge.
TASK 1
P1- Analysis of key considerations for evaluation of growth opportunities
In recent times, it is crucial for a business operation to have high profit ratio which is
followed by appropriate growth measures by offering their products and services to their targeted
customers. The marketing manager of Airdri is required to evaluate the growth opportunities
along with the help of BCG and GE matrix. This analysis is explained as follows:
Boston consultancy group matrix
BCG matrix involves the use strategies for long term planning and knowledge about
market share and growth which depends upon the performances (whether high or low) of
products and services offered by the company (Globocnik, Faullant and Parastuty, 2020). The
potential of the product can be determined by BCG matrix analysis. The four quadrants of BCG
matrix is explained as follows:
Star product: The products included in this matrix have high growth and high share in
the marketplace because of its targeted customers. The company Airdri consists of a dryer
consisting of high sales ratio which mainly earns profit for the company (Brunetta and Caldarice,
2020).
Cash cows: This particular quadrant consists of products which have high market share
but a low market growth. The products at Airdri with the lowest innovation do not have much
market growth but they have a high share in the market (Papageorgiou, Petrakis, Ioannou and
Zagarelou, 2019). With continuous investments and appropriate innovations these products have
the potential to convert themselves into star products followed by high market growth.
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Question mark: This quadrant includes good which have low share but a high market
growth. The new inventions at Airdri will be considered question mark products. To be able to
convert themselves into star products, the company is required to perform promotional activities
for advertising the products to its targeted customers. These promotional activities will ensure
the enhancement of market share of the products at Airdri.
Dog: The products under this quadrant have low market share along with a low
possibility of future growth (Young, Rosenstiel and Henderson, 2020). The company Airdri, is
required to invest more money in this segment for converting these products into star and cash
cows products.
GE Matrix
This matrix is also called as nine grid cell matrix. This nine grid matrix depends on the
attractiveness and units of the product. The explanation about GE matrix is explained as follows:
Invest/Grow: The products which have high attractiveness along with high market of the
product. The organisation, Airdri, will invest more in products with high attractiveness and high
market share. The organisation will invest in these products to capture the market share.
Hold/Selective: This particular grid consists of business units which are least attractive
which explains their poor performance. The business organisation is required to convert these
units into star products for the capturing the marketplace. This can also be done by introducing
new innovations.
Harvest/divert: The units have poor performance in the marketplace due to lack of
attractiveness. The dog products of the BCG matrix of the business organisation Airdri will be
included in this grid (Linovski, 2019). Therefore, the company must not invest in these business
units for growth.
P2- Evaluation of growth opportunities with the help of Ansoff growth vector matrix
The Ansoff matrix, also called market growth matrix, which is considered an effective
tool for the investigation and evaluation of growth strategies in planning for growth of a
business.
Market penetration: The strategy for market penetration includes the use of strategies
which will help the company grow within the marketplace with their current products. The
manager of Aridri is required to make appropriate plans for enhancement of the market share and
profit. The manager of Aridri will lower the prices of current products along with promotion of
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these products will help the product to capture market share. This strategy will also help the
company gain loyal customer base along with diminishing any possibility of growth of rival
companies. The company, Aridri will be able to capture the market from any rival companies
which fosters high profit earning ratio.
Product development: The strategy of product development is used when the company
aims at introducing a new product in the same market that they current produce products. The
company is required to possess appropriate knowledge about the needs of the customer and
manufacture a new product according to the emerging needs of the customer (Olesen, 2022). The
marketing managers at Airdri, must develop new innovative products to satisfy the emerging
needs of the customer by manufacturing a portable hair or hand dryer, which is need of the hour.
Therefore, the planning of new products should be done accordingly as it can reap maximum
profits for the company.
Market development: This strategy is used by companies that are planning to venture
into a new genre for fast capturing of the marketplace. It is often used by organisations
expanding their businesses overseas, a new nation or local areas. The strategy of market
development caters products to a large audience with the help of an existing or current product.
The geographical area of the new market is decided on the basis of customer base, different
preferences of the customer and the presence of any rivals in the already existing market
(Pinnegar, Randolph and Troy, 2020). The rising need for hand dryers will help the company to
enter international and local market. The fluctuation of the economy of the UK due to Brexit
suggests, that the organisation will formulate an effective plan for entering international market
to be able to capture high profits.
Diversification: The strategy of diversification is related to the business organisations
which are ready to introduce a product in the market. The product genre is new and
experimental, something that the company has not catered before. There are two types of
diversification- Related and Unrelated diversification (Rienzo and Chen, 2018). Related
diversification includes exploring new market places with new products in the same industry that
the company deals with. Whereas, unrelated diversification is defined as the process when the
company enters a new market with a new product from a different industry altogether.
Diversification strategy helps in capturing the market with the help of a new product introduced
in the marketplace. The enterprise Airdri aims at entering a new market venture by
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manufacturing a new product, such as a vacuum cleaner, for the company to be able to generate
higher revenues. Before entering the market, extensive research is conducted about the needs of
the customers and strategies to cater it.
This extensive discussion concludes that the growth strategy opted by Airdri is Market
Development Strategy. The company aims at entering the local markets of the United Kingdom,
because of its origin (Sørensen, 2018). The local markets of the UK are selected as it will be
easier for the company to capture the market share with its existing products. The company will
enter the markets where the demand is at its peak which will make the customer pay willingly for
the product. Through this strategy the company will be able to capture local market and maintain
its sustainability.
M1- Justification of growth alternatives utilising various frameworks to showcase the competing
benefits in context to the organisational scenario
Utilization of frameworks such as Ansoff growth vector matrix and SWOT analysis,
Airdri can access various growth opportunities and gain competitive advantage. There is
availability of enough resources which will help the company gain loyal customers.
D1- Measurement of growth alternatives along with the risks attached
The strategy of market penetration will assist the company to introduce products in
existing markets. Another strategy which can be used is market development strategy, helping
the enterprise increase their market share and profitability.
TASK 2
P3- Potential sources of funding along with the benefits and drawbacks of the each method
Businesses work towards the manufacturing of goods and providing services to the
targeted customers for the generation of revenue for the company. For the operation of these
services, the company requires funds and different sources of funding (do Paço and et. al., 2021).
The funding methods used by Airdri for the expansion of their market are explained below:
Internal source of finance:
This source of funding involves the funds which are generated from internal sources of
the business operation as there is a less chance for risks. These internal sources include sales of
assets, cash sales and reinvestment of earned profits.
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Advantages Disadvantages
 Airdri will uphold power and
perpetuate control of the business
themselves.
 Raised profits and good will of the
company along with decrease in the
overall costs (Clifton and et. al., 2020).
 Safeguard from weakening control over
ownership.
 Hampered availability of routine cash
requirement.
 Increased possibility of bankruptcy.
 Persistent lack of cash.
 No taxation rebate.
External sources of finance: This method involves the use of extrinsic operations or
activities for the generation of funds. Some of the various methods of external sources of
financing are explained below:
Bank loan: Bank loan is the agreement between two parties where one party has applied
for the loan and the other is giving out loan. There are some pre-decided instalments within a
specific time for the loan amount to be paid back (Mazzarol and Reboud, 2020).
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Advantages Disadvantages
 Inexpensive and trustworthy method
for capital loss
 disburse of funds is possible in required
areas.
 A proper financial planning is adopted
for settlement of pre-decided
instalments (Yeniaras and Kaya,
2021).
 It is considered a risky method in
context to company's assets.
 Instalments begin immediately after the
loaning of money irrespective of usage.
 Inappropriate cash flow can cause
difficulty in paying the instalment
amount.
Crowdfunding: This method involves the use of social media as a mediator for the
gathering a particular amount of money. Entrepreneurial skills are promoted along with
collection of funds.
Advantages Disadvantages
 Airdri will have to put in less efforts
and the cost of processing funds will
also be less.
 The investor can become a potential
client in the long run.

 Crowdfunding will be difficult to
obtain if Airdri does not produce
innovative products to catch the eye of
an investor.
 The goodwill is negatively influenced.
Angel investors: These investors are employed in providing single investment worth of
financial support to small start-up businesses. The net worth of the investors is very high which
makes them angel investors.
Advantages Disadvantages
 There is no risk associated for Airdri as
there are no assets for mortgage.
 The loss capital for Airdri will reduce.
 Huge investments are not appropriate
for small businesses. The proprietorship
of the business is lost (Shpak and et. al.,
2020).
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 Angel investors are hard to find
M2- Assessment of prospective funding sources
Airdri must analyse all the sources of financing before selecting one suitable method.
Bank loans are suitable for generation of funds and the stakeholders have all the owner's rights.
The company can test the reaction of its customers through crowdfunding.
D2- Evaluation of possible funding options and selection of one as per requirements
After analysis, Airdri can easily access the most suitable source of funding for the
company. Bank loans are required for funding the process of expansion of product ranges.
Acquiring a bank loan is an easy task compared to other sources of funding. Also, crowdfunding
is an effective method for attaining media attention and free marketing.
The method of funding appropriate for Airdri for the expansion of their market is a bank
loan. The business capital of Airdri is sufficient enough for the repayment of instalments. Bank
loan will enable the business to operate successfully without interventions. There will be an
appropriate financial plan for payment of monthly instalment.
TASK 3
P4 – Designing a business plan for growth
A business plan consists of all the objectives and goals of an organisation which are
summarised in a strategic and functional manner. A business plan basically focuses on the
growth and expansion of Airdri. A business plan for Airdri is explained as follows:
Executive summary: Airdri deals in technological advanced hand dryers. Founded in
the year 1974 by Peter Philipp's and Peter Allen in the United Kingdom. There are a huge ranges
hand dryers which are the emerging demands of the customers in today's times (Rahmafitria and
et. al., 2020). There are seven different types of hand dryers available. The organisation wishes
to expand their business operations to international markets for increasing the goodwill.
Vision: The vision behind expansion is to increase the customer base along with the
ensuring the availability of dryer in all the markets of the UK.
Mission: The mission of Airdri is to open up new outlets all over the United Kingdom.
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Goals: The organisational goals is increase the sales by manufacturing of standardised
products which facilitate sustainability in the business operation (Rinaldi, Maarif, Thamrin and
Supriyadi, 2022).
Objectives: The organisation opted for SMART strategy for market expansion.
S- Specific : Enhancing customer values and sales
M- Measurable : The customer base and sales are expected to increase by 15%.
A- Attainable : Sufficient training is provided to the marketing staff to attain the organisational
goals.
R- Relevancy : The ability to enhance market share and goodwill.
T- Time Bound : The set by the company for achieving these standards is 2022.
STP Model
The STP model helps in the identification of the most profitable and captivating segment
of the business. The STP model enables the company to earn high profits and implementation of
marketing strategies. The company Aridri can use the STP model for the identification of
segment which needs development.
Segmentation: This stage of framework of STP allows the market to be divided into
segments which allow the organisation to fulfil their organisational objectives in a considerable
manner. This division will allow Airdri to analyse the market on the basis of demographic and
behavioural features (Kepczynski, Jandhyala, Sankaran and Dimofte, 2018). Therefore, it will be
easier to meet the demands of the customer through this division in an effective manner.
Targetting: This segment will require the organisation to focus on their marketing
strategies for the establishment of join ventures by collaborating with malls and construction
buildings. Airdri will be able to target market in a sequential manner.
Positioning: The positioning of products of Airdri will be at newly opened stores for
making it easily accessible to customers. The access to these products will be made easier with
these positioning strategies.
Resource allocation: The strategy for resource allocation will allow the business to
allocate each activity towards the growth and success of the business.
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Total estimated budget: It is crucial to maintain an appropriate standard of budget
which helps in determining the expenses required for the conduction of 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
Cash flow statement: The cash flow statement allows the organisation to determine the
flow rate of liquid funds. This flow of liquid funds is an important factor for the analysis of
financial position of the business enterprise. A cash flow statement consists of liquid outflow
which is paid by the business in lieu of liabilities and investments.
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From the evaluation of above cash flow statement record, it can be concluded that Airdri
has sufficient funds to be able to pay off their liabilities and recurring expenses. This will help
the company stay sustainable for a very long time. The cash flow of the company is $1300, $200,
$7700 for the years 2023, 2022 and 2021. These statistics reflect the financial position of Aidri
enterprises.
Monitoring and Controlling: The process of monitoring and controlling is crucial
during the execution of business and growth strategies in a business unit. The availability of all
the resources is ensured to produce maximum outcome in a cost effective way. The process of
monitoring and controlling in Airdri will be a key indicator of performance for laying control
over the project in order to obtain the best possible outcome (Dawes, 2018). This will ensure that
the best quality of products and services is provided to the customers.
M3- Elaborated business plan for growth and investment collection
Airdri requires a strategic business plan for the expansion of business operation. The
accomplishment of business objectives becomes easier when a ready-made business plan is
provided. All the required strategies are implemented for calculating the overall output on the
basis of pre-decided business plan.
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D3- Producing an in-depth business plan for formulation, application and achievement of
objectives
To understand the objectives of the company, it is crucial to have a business plan. A
business plan helps in guiding and assisting the company for achieving the targets. A business
plan acts as a roadmap for attaining goals.
TASK 4
P5- Assessing of exit and succession options for business operation about the benefits and
drawbacks
Succession planning is a process through which the owner or leader of the business
enterprise is transferred or relocated to another company or leader. Succession planning allows
safe business conduct for the operation of business without any hurdles or obstacles. Different
methods of succession planning is given as follows:
Acquisition: This method of succession planning is categorised where the company is
sold to another company through a full or part buying of shares. The authority of decision
making shifts to another company.
Advantages Disadvantages
 More competence is acquired through
new resources leading to rapid
expansion.
 New workforce is introduced in Airdri
which leads to new innovations.
 The acquisition cost is high and the
internal working can be hampered
through a series of internal conflicts
(Zanjani and et. al., 2020).
Merger: This method involves the integration of one business venture into another
company for enhancing the efficiency of overall business. There are two types of mergers-
Horizontal and Vertical. Horizontal merging involves the integration of companies from the
same industry, whereas on the other hand, vertical merging involves the integration of businesses
from different industries.
Advantages Disadvantages
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 Enhanced economies will lead to more
competence along with broadening of
financial position at Airdri.
 Trade restrictions are removed due to
international market acquisition which
makes the company enhance their
goodwill and customer value .
 Vertical merger will create a negative
image about Airdri in the minds of
customers (Ahmad and Bakar 2018).
 Employees may feel disregarded due to
reduced number of jobs.
The business venture Airdri may opt for Acquisition for expansion of their products in
the market place. The process of acquisition will allow Airdri to effectively use their resources
and allocations in a planned manner. This will allow the company to enhance their customer base
along with increment in brand value leading to higher profits. The needs and demands of the
customer will be satisfied and new customers will be attracted.
M4- Measurement of exit or succession choices
The different options of succession help in comparison of options in a logical manner.
The business needs can be groomed accordingly along with the growing trends of the
marketplace. The ownership right of Airdri can pass to a relative or family member for the
business to be relevant.
D2- Effective judgement for exit or succession alternatives
There are two options which can be opted by Airdri, first being, passing the business to a
family member. On the other hand, the second option is to sell the stakes of the enterprise to a
suitable investor.
CONCLUSION
From the analysis of above detailed report, it can be concluded that a deduced growth
plan is crucial for achieving the aims and objectives of a business enterprise. The growth
opportunities prevailing in the marketplace can be identified with the help of BCG and GE
matrix. These matrixes offer a framework for the rectification and implementation of different
strategies required for expansion of the business venture, which in this case is Airdri. The best
implemented strategy for expansion plan is the Ansoff growth vector matrix, which will enable
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the company to earn more profits and market share. After framing a growth plan, it is necessary
to arrange funds for the same to be able to adhere to the formulated growth plan and marketing
strategies. The combination of these factors will ensure the success of the organisation and help
Airdri achieve new heights and sustainability by capturing market share through its targeted
customers.
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