Planning for Growth in Business

This report discusses the potential sources of funding for business growth, including bank finance, crowd funding, and private financing. It also covers the importance of a business plan and exit strategies. The case study focuses on Airdri Ltd., a company in the hair dryer manufacturing industry.

Planning for Growth in business
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TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
Assess the potential sources of funding.......................................................................................3
TASK 2............................................................................................................................................7
Business plan...............................................................................................................................7
CONCLUSION..............................................................................................................................10
TASK 3..........................................................................................................................................11
Exit or succession strategy.........................................................................................................11
REFERENCES..............................................................................................................................14
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INTRODUCTION
Every business wants to expand its operation in competitive environment to enjoy more
profitability and market share by meeting customer’s expectancy in best possible way. Company
in order to diversify its business operation require huge amount of capital and resources so that
end goals can be achieved. Manager is responsible for identifying several methods through
which fund can be arranged and optimum utilised so that organisation can earn maximum return.
This report is about Airdri Ltd. that have more than 40 years of experienced in designing and
manufacturing hair dryers for end customers. It has included information related to different
sources of finance that are available for company to meet its capital requirements. Report has
also content business plan and different existing strategies options that are available for Airdri
Ltd.
TASK 1
Assess the potential sources of funding
Funding is a key requirement associated with the business operations undertake by the
organisation. In order to conduct any business operation funding is the basic element that needed
to consider by the organisation in order to complete the respective project. Following are the
various funding sources associated with the organisation. All these sources are further associated
with different advantages and drawback that can be projected in the following manner.
Bank finance
Bank finance is among the key funding source that needed to address while evaluating
the key potential funding source in regards to the organisation. Management at the Airdri Ltd can
approach to the bank in order to raise the funds for various operational requirements at the
organisation. Bank allocates loans or funds at a very effective interest rate. Bank finance is
among the prioritises funding source that approached by all companies and organisation engaged
in doing business operations. Airdri Ltd can approach banks to meet its funding requirements.
They can allocate the loan and funds for both long term and short term funding requirements of
the organisation (Agyemang and Silva, 2019). Bank allocates potential funds for various funding
requirements of the organisation. Bank charges interest at a fixed rate and also provide facility to
part payment or for close. All these facilities are available in the funding source call as bank.
This is a key funding source hat would support the organisation. In this source of funding
company need to pay interest at the specific rate against the funding requirements of the
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organisation. Company can approach to the specific bank for all its funding requirements which
would support the organisation in fulfilling all its need related to the growth and development of
organisation. In this funding source the competitive advantage organisation is associated with in
respect to company can approach to more than one bank in against to meet all its funding needs
of the company.
Advantages of bank finance
 Company required paying interest at a very specific rate.
 Company can part payment and for close the entire finance.
 The rate of interest in many banks charge at the reducing rate which also a potential level
of advantage associated with the bank finance.
 This funding source is effective i context to the long term funding need and short term
funding need of the organisation.
 The repayment schedule of the bank is also clear which support the organisation in order
to meet all its funding needs and requirements in the scheduled manner.
Disadvantage of bank finance
 This funding source is expensive.
 Bank charge interest at the higher rate which create extra cost over the organisation.
 In case of part payment of for close company needed to pay charge against such facility
which create extra cost in this funding source.
Crowd funding
Crowd funding is a key funding source that can be availed by the Airdri Ltd. In this
funding source company approach would support the organisation meeting all its funding
requirements. In this source company approaches to the normal people and crowd to invest in the
business of the Airdri Ltd. Company allocate the ownership to all the people who invest in the
organisation. This approach of meeting fund requirements allow company to issue shares at any
of the listed stock exchange. People get to invest in the business functions of the organisation.
Crowd funding is a beneficial source of funding which allows company to control the interest
cost or other such cost like part payment charges or for close charges against collection of funds
for meeting the needs of the organisation (Zafar and Akhtar, 2020). The benefit associated with
these founding sources is that company do not needed to bear the pressure of repaying the entire
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loan or funds. The distribution of ownership also improves the brand value of the company. This
funding source can be approached by the Airdri Ltd for fulfilling its long term funding needs and
requirement of the organisation. Crowd funding would support the organisation in achieving all
its funding requirements against the business operations undertaken by the organisation. This
funding source also identified as the cheapest way to collect funds and also the best approach to
raise huge funds for meeting all types of funding requirements associated with the growth of the
organisation.
Advantages of crowd funding
 Best approach to collect huge funds.
 This is a key approach to collect funds for meeting long term requirements of the
organisation.
 This funding source erases the extra pressure of repaying the entire funding amount due
to the ownership distribution in this funding source.
 Company do not need to bear the interest amount over allocation of such respective
funds.
 Company do not need to approach any other funding source to collect and generate funds
for the business growth.
 This is a controlled way and approach to collect and raise funds in business.
Disadvantages of crowd funding
 Crowd funding involve allocation of the ownership of the people invets in the business of
the company.
 This funding source creates cost in form of allocation of profitability of the organisation
for the life time.
 Company losses control over the ownership of the business organisation.
 Its a risky approach to collect funds especially for the companies like Airdri Ltd who is a
small business organisations.
 Any time the investor can go out of the business by selling the shares of company.
Private financer
Private financers are the private sector organisations likes to invest in the business
operations of other companies operating its business in the business environment. Airdri Ltd can
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approach to private financer for fulfilling its funding requirements at the organisation. This is a
key approach to generate long term and short term funding requirement associated with the
organisation. In case of growth planning organisation always seek for the funding choices that
can meet up the long term funding need of the organisation (Wu, 2018). Private financer allocate
funds fr the specific time frame for the specific rate of interest that will be charges every year.
They also provide the services of part payment and for close the entire loan amount. They take
security of the company against allocating the funds to meet the funding need and requirement of
the organisation. Private financer provides loans at the specific rate that never changes
throughout out the loan. This remains constant in respect to the organisation as the private
financer can provide the entire loan requirements of the organisation.
Advantages of private financer
 They are capable of allocating all the funding need of the company.
 They charge interest at the specific rate of interest.
 The part payment facility is available with the organisation.
 For close facility is also available with the organisation in case of private finance.
Disadvantage of private financer
 They charge heavy interest from the company.
 This funding source charges security against the allocation of funds to the organisation.
 The interest rate is higher than other funding source which create extra cost in this
funding source.
The above mentioned points demonstrate various funding sources associated with the
Airdri Ltd. Airdri Ltd can avail the bank finance for all its funding need and requirements. This
would support the company in meeting all its fund requirements in order to approach the long
and short term funding source of the organisation. This would support the company in paying
interest at the specific rate which do not involve any extra cost. This source also cater the
advantage like company can for close the loan and part payment the entire loan if the
profitability of the organisation is suitable to do the respective action.
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TASK 2
Business plan
Business plan is an written document that contain information related to several
strategies, steps or action that company have planned to take in future circumstances. Therefore,
business plan of Airdri Ltd. is made in order to understand key steps that company can take in
future in order to gain competitive advantages in external environment (Snider and Davies,
2018). Such as:
Executive summary
It is a business plans that include objectives, or future goals that Airdri Ltd. wants to achieve by
delivering qualitative services and products to range of individuals. It have contained complete
detailed related to Airdri Ltd., its mission and vision statement, strength and available
opportunities that motivate company to diversify its business operation. It has also include
information related to management, marketing and sales procedure and financial projection that
company can planned to make use in order to attain its desired goals.
Overview of business
Airdri Ltd. is leaders in development or manufacture of warm hair dryers having more than 40
years experienced with employees ranging from 50-200 that are working determining for growth
and success of enterprise. Company have make use of innovative technologies, unique design to
make customers happy and satisfied and increase its market positioning in electronic
manufacturing industry.
Vision and mission statement
It can be stated that mission and vision statement of Airdri Ltd is to offer better quality, unique
design hair dryers to key individuals so that they can become loyal customers of organisation.
Main purpose of firm to operate its function is to enhance customer satisfaction by delivering
products or services that are beyond their expectancy level. Company have followed all ethical
value and principles while operating its business thus wants to grow and sustain its operation for
longer time frame.
SWOT analysis of business
It is model that is used to understand strength and weakness of firm that is internal factors and
threat and opportunities i.e, external factors that influence of growth and success of organisation.
So, Swot model is used to analysis areas in which company have strength and weakness which
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can be illustrated as follows:
Strength: Airdri Ltd have its strength in qualitative products and services and strong brand
image that helps in motivating number of customers to have its hair dryers to satisfy their
specific needs. Company by making use of its strong brand image and unique products can
expand its business in domestic as well as in international market (Denisenko, Shaposhnikova,
and Budiakova, 2019). Therefore, company by making use of its strength can make best
utilisation of available opportunities.
Weakness: The biggest weakness of Airdri Ltd is that it has limited capital or resources to offer
numerous products and services to wide range of people. Company needs to work on its key
weakness in order to add new customers within organisation and earn huge profit margin.
Opportunities: Company has opportunities to expand its business operation in existing as well
as new market by providing them better products at reasonable rates. It has another options or
alternatives to grow its sales volume and profitability that is more use of internet, digital
technology to create awareness among people about several products and services in which
company deals. Airdri Ltd by making more use of electronic devices can easily promote its
products and increase its profit margin.
Threat: There are several threat from which Airdri Ltd is suffering from like changes in
government policies, technology and taste and preferences of people. Due to dynamic nature of
external environment company is unable to decided right strategy that can be fruitful in
sustainability of enterprise. Increasing competition level is another threat from which Airdri Ltd
is suffering so company needs to work on its products unique to retained customers loyalty
(Ivanisević and et.al., 2019).
Objective
 To expand market share by 15% till 2021 by entering into new market segment with
existing product range.
 To make more use of online platform to market and provide better services to customers.
 To increase in product portfolio so that people have more alternative options to select for
fulfilment of their respective needs.
 To take steps towards sustainable management so that no harm can be caused to people
those are living in society.
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Organisation and management
Airdri Ltd is small enterprise with limited number of employees that are performing several
function and operation so that firm can attain its desired goals. Company have planned to make
definite organisational structure so that employees are clearly understood about their respective
roles and responsibilities within firm (Dagnino, King and Tienari, 2017). Distribution of specific
task that need to be performed by particular individuals has helped company in achieving its
goals in limited time frame. Management of Airdri Ltd is also effective that contribute in best
utilisation of available resources and maximum value delivery to end customers. Management
have decided to brining economic of scales so that products can be manufactured in large
quantity and delivered to end users for fulfilment of their respective needs.
Services or product line
Company have single products line that is Hair dyers that has helped in attracting limited
number of customers range to become part of organisation for satisfaction of their respective
needs and requirements. It have stated that its products are user comfort and low energy
consumption, make less noise and longevity thus provide better or effective experienced to users.
They are more durable for busy washroom so customers can easily make use of its products that
is hair dryers for longer time frame (Kepczynski and et.al., 2019). Organisation by offering
durable electronic products is able to build trust and confidence level among customers to prefer
its products to satisfy their several requirements and wants. Therefore, its hairdryers are fit for all
washroom environment.
Marketing and sales
Company have planned to make use of different marketing method or techniques to retained
maximum number of customers within firm for many years. Traditional marketing method such
as TV advertisement, personal selling, sales promotion and billboards will be used to provide
information to customers about products and services in which firm deals so that they can make
correct decision to purchase. Airdri Ltd has also decided to make more use of digital or social
media like Twitter, you Tube, facebook and Instragram to connect and build strong relationship
with customers. Official websites is a place at which customers can easily visit, overview
products, feedback or experienced of previous customers and compare price and quality of
products with competitors. In order to make right decision to purchase in order to satisfied their
respective wants and requirements (Kumar, 2016). Airdri Ltd also decided to make use of email
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and content marketing to maximum number of customers and sales volume of organisation.
Therefore, effective marketing strategies will help company in generating more revenue and
market share in electronic industry of UK.
Funding request
There are numerous options or alternative from which company have easily raise fund, so out of
the for implementation of business plan Airdri Ltd has planned to make use of bank loan. As
company can easily arrange large amount of capital by paying small instalment or interest in
several months.
Financial projection/ Budget
Expenses Amount
Stationery expense £250
Wages or salary £1500
Rent £1000
Research and development £750
Marketing and sales £1500
Total £5000
Stakeholder analysis
It is model that is used to analysis stakeholders that are interested in growth and operation of
business like customers, owner, employees and suppliers or government.
High power, Low influence: Customers of Airdri Ltd have more power and low influence so
company
High power, high influence: Owner of organisation has more interest and more power to take
overall decision of firm.
Low power, low influence: Suppliers have low power and influence in operation of enterprise
Low power, high influence: Employees have low power and high interest in growth and
sustainability of operation (Hansmann, 2018).
CONCLUSION
It can be concluded from above analysis that company through raising fund from bank
loan can easily meet all its expense and promote smooth operation of business in United
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Kingdom. It can also be summarised from above analysed that company have opportunity to
diversify its operation by entering into emerging market. At last it can be stated that there are
several existing strategies that could be used by company Airdri Ltd to quite its operation in
future circumstances.
TASK 3
Exit or succession strategy
Exit or succession strategy is denoted as the tactics used to achieve the smooth exit in
case of failure of the business operations. This strategy is also a part of the growth planning of
the organisation. Following are the strategies can be implemented by the Airdri Ltd in order to
exit and success in the business operations entertained to avail more growth in the business.
Transfer ownership
This is a key exit strategy that can be channelizes by the organisation. In this strategy
ownership of the business is transferred to other stakeholders ready to take on the entire business.
On the suitable amount or capita ths transfer in ownership is conducted at the organisation level
(Medeiros, 2017). This is a key strategic choice available with the organization that would
support the company in achieving the best level of exit objectives in the business. In case of
failure of business exit becomes the tough choice that can be entertained by the organisation.
Ownership transfer also include the transfer of all the assets associated with the Airdri Ltd and
all the liability the organisation is liable against the business functions entertained by the
organisation.
Advantage of strategy
 Company get to conveniently transfer the entire business to other stakeholders interested
in acquiring business functions.
 This is a smooth process to exit from the business operations.
 All dues of organisation get to pay by the new owners of the business.
Disadvantage of the strategy
 Assets are acquired by the new owner at the cheap prices which contain the strategic loss
to the business.
 It does not assure the repayment of all liabilities associated with the business.
Transfer business to relatives
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This is another option available with the organisation in regards to the exit strategy. In
this entire business is transferred to the relatives of the owner. All such peoples who look
interested in buying the business is approached in this strategic choice (Abolhasani and et.al.,
2016). This is a key technique of entertaining exit from the business. Ownership of the business
get to transfer at the convenient way in this approach.
Advantages of strategy
 All assets and liability of the company is transferred reasonably in this strategy.
 Smooth approach to get the exit from business in case of failure.
 Assets are transferred at the best price possible in this strategy.
Disadvantage of strategy
 This is a risky approach to make the exit from business.
 Goodwill of owner are on the stake of risk in this strategy.
Liquidation
Liquidation is among the key exit strategy that channelizes by the owner in against to the
failure of business. In this strategy all dues are repay against the assets of the company. The
management sale its assets of the business in against to repay the loan and due business
organisation is liable to pay to the organisation. Liquidation is among the key choice which
available for the Airdri Ltd in order to make the exit from business (Freire Trigo, 2020). Airdri
Ltd can avail this option in order to exit and from the business venture in case of failure of the
business. It is a smooth way or approach to exit from the business.
Advantage of strategy
 Most convenient technique to make an exit from business.
 Assets are getting to sale at the best price possible.
 All dues are repaid in this technique.
Disadvantage of strategy
 It is a risky approach to make the exit from business.
 It is not necessary that company get the best prices against the assets company sale in this
strategy.
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The above mentioned strategies the suitable approaches to make the exit from the
business that is nearby to entertain failure (Monstadt and Meilinger, 2020). The strategy like
transfer ownership is the most suitable approach to exit from the business in case of failure of the
transactions entertained by the organisation.
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REFERENCES
Books and journals
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Ghanaian city-region with a cellular automata model: Implications for urban planning
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Dagnino, G. B., King, D. R. and Tienari, J., 2017. Strategic management of dynamic growth.
Denisenko, N., Shaposhnikova, O. and Budiakova, О., 2019. The essence and role of investment
business planning in modern economic conditions. Вчені записки університету КРОК.
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Freire Trigo, S., 2020. Vacant land in London: a planning tool to create land for
growth. International Planning Studies. 25(3). pp.261-276.
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Kumar, P., 2016. Sales and operations planning (S & OP)-an overview. Discovery, 52(243).
pp.564-571.
Medeiros, E., 2017. From smart growth to European spatial planning: a new paradigm for EU
cohesion policy post-2020. European Planning Studies. 25(10). pp.1856-1875.
Monstadt, J. and Meilinger, V., 2020. Governing Suburbia through regionalized land-use
planning? Experiences from the Greater Frankfurt region. Land Use Policy. 91.
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Snider, J. H. and Davies, K. J., 2018. Success Strategies for Small Financial Planning
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Wu, F., 2018. Planning centrality, market instruments: Governing Chinese urban transformation
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Zafar, A. and Akhtar, G. K. H., 2020. Effect of succession planning on organizational
growth. Journal of Social Sciences and Humanities. 59(1). pp.21-33.
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