P1 Key consideration for evaluating growth opportunities and justifying

PLANNING FOR GROWTH

CONTENTS
INTRODUCTION.......................................................................................................................................1
LO – 1.........................................................................................................................................................1
P1 Key consideration for evaluating growth opportunities and justifying in the context of organization 1
P2 Opportunities for growth by applying Ansoff’s growth vector matrix................................................3
LO – 2.........................................................................................................................................................5
P3 Assessing the potential source of funding available to business with its benefits and drawbacks......5
LO – 3.........................................................................................................................................................7
P4 Designing a business plan for growth including financial information and strategic objectives for
scaling up a business................................................................................................................................7
LO – 4.......................................................................................................................................................10
P5 Assessing the exit or succession options for SME with benefits and drawbacks..............................10
CONCLUSION.........................................................................................................................................11
REFERENCES..........................................................................................................................................12

INTRODUCTION
Throwing light in relation with the Small and Medium Enterprise (SMEs), it is quite
assorted group. They are generally found in a wide array of business activities that ranges from
artisan producing agricultural products to coffee shop and small sophisticated engineering firm
engage in selling automotive parts. These firms carry out their business in different markets such
as rural, urban, regional, national and international. For successful operations, they require
various levels of skills, growth orientation, capital and sophistication (Ha-Joon, 2001). Many
recent empirical studies have significantly depicted that SMEs has a contribution of around 55
percent of GDP and over 65 percent of the total employment in the high-income nations.
Pertaining to this, as junior Manager in an SME located in Thames Valley area in UK evaluation
will be undertaken on how these small and medium enterprises plans for growth. Concerning
this, the main aim of the research report is to evaluate how SMEs develop and growth. For this
project, Southern Business Technologies is being taken consideration. The firm is engaged in
supplying business to business telecom products and services for SME in southern England and
was founded in the year 1965. They deals in digital telephone lines and integrated services digital
networks, data services like internet access, leased lines, business telephone systems and
broadband. The report will focus on various techniques being adopted by Southern Business
Technologies to identify potential opportunities for growth. In addition to this, comprehension in
relation with the varied sources of investment finances and options available for the firm in
relation with exit and family business succession will be done. The final part of the report will
throw light on importance of making informed choices when selecting routes to growth and will
understand the potential risks and reward involved with growth.
LO – 1
P1 Key consideration for evaluating growth opportunities and justifying in the context of
organization
It is quite vital to evaluate the growth opportunities and finding ways to achieve them. It
is important on the part of Southern Business Technologies to plan carefully about the growth so
as to achieve success. Talking in references with growth, it involves risks, but if right strategy is
adopted than it can deliver stability, long term profits and security (Daron, 2003). For this, it is
necessary to assess the strength, weakness, opportunities and threats of the own company and
1

various ways to handle them, the firm can move on to the next level i.e. developing a growth
strategy. Each and every business changes their focus when they are mover ahead of the start-up
phase (Badrinath and et.al., 1997). For ensuring sustainability, determining opportunities for
growth becomes a priority for SMEs such as Southern Business Technologies. The opportunities
for growth can be determined by using PESTEL analysis and is being defined underneath:
 Political – The business of Southern Business Technologies is being influenced by
numerous political factors such as trade tariffs, fiscal policy, tax policies and many more.
Political stability in UK is a great strength of the nation. In addition to this, there are
many acts being imposed by the government of UK such as Brexit, which has given birth
to uncertainties as well as debates related to politics. Other than this, taxation, import and
export costs, inflation and other health policies may influence the new business of
Southern Business Technologies. There is political stability in UK.
 Economic – Because of the weak economy of UK, both retailers and non-retailer of
Telecom industry is impacted a lot. Due to economic recession in the year 2008, the
economy was in great trouble. The purchasing power of the people also falls down during
this slowdown. In recent years, new trend has been witnessed in UK. In recent years i.e.
2017, the inflation rate rose to 3.1 percent. People are now paying more for the services
and products which helps them to relax and thus, it opens opportunity for Southern
Business Technologies in brewing or food sector. Other than this, change in the rate of
tax and decrease in the pound will influence the business of Southern Business
Technologies (Rafiq and Kennedy, 2002).
 Social – Social factor also play a significant role in influencing the operation and working
of the business concern. Focusing towards the UK, the standard of living of people is
increasing at a fast pace and thus, people are demanding high quality internet and other
telecommunication facility to cater with this modernized world irrespective of the high
price. This can prove a major advantage to Southern business technologies.
 Technological – Seeking help from this factor, the firm can achieve a competitive edge in
the market. More efficient technologies such as fiber wire builds, more compact devices
etc. can help the company to increase their profit margins. In addition to this, the recent
trend of mobile apps can augment the sale of the product (Surbhi, 2017).
2