Planning for growth - Oak cash & carry Ltd Assignment

Planning for growth

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Key consideration for evaluating growth opportunities and justify these considerations.....1
P2 Opportunities for growth by applying Ansoffs growth vector matrix ..................................4
TASK 2............................................................................................................................................5
P3 Potential sources of funding available to businesses and discuss benefits and drawbacks...5
TASK 3............................................................................................................................................7
P4 Design business plan for growth that includes financial information and strategic
objectives.....................................................................................................................................7
TASK 4..........................................................................................................................................10
P5 Assess exit or succession options for a small business explaining the benefits and
drawbacks .................................................................................................................................10
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Planning is very necessary activities in every sector of business doing and also one most
prominent to growth and development of the company. In context of business growth, doing an
effective planning is very necessary to led its suitability for longer period of time. In a current
scenario of business operation, growth building is necessary and also the prominent stage for
doing business functioning (Keyser, 2016). In a current scenario, business expansion is comes
under the category of doing planning for growth and also business generation over longer period
of time.
This report will be carry on Oak cash & carry Ltd, which provides cash and carry service.
This company offers wide range of products in bulk for retailers, caterer, offices off licensees
and newspaper agents. This business firm is headquartered in United Kingdom. Apart from this,
report will be carry on key consideration for an evaluation of growth based opportunities along
with evaluation of an opportunities by application of the Ans-off matrix. Also, report will have
major discussion over finding potential sources, structuring of the business plan and assessing of
an exit or succession options for small businesses and related drawbacks.

TASK 1
P1 Key consideration for evaluating growth opportunities and justify these considerations
Planning play a important role in achieving the goal of the organisation. In this analysing
the current operations and consider the factor where they can improve future. Growth of business
is about reaches to the highest level of expansion and consider point to generate profit.
Competitive advantage:
This is the position from which organisation helps in becoming more profitable than the
competitors. In this there is many different resources that is required to perform business
operations which seek to attain target (Mobin, 2016). Oak Cash & Carry has various factor that is
useful in the growth of business operations. For achieving competitive advantages , there are
some elements that are explain below:
Resources: This the tool which is tangible and core basic part of the organisation. This is
the tool which differentiate their product from others. Oak Cash & Carry use new update
technology and design to achieving competitive advantage.
Capabilities: In Oak Cash & Carry they have highly skilled employee and they have
great capability. This help this organisation to achieve its goals and objectives.
Core competencies: This is the combination of of multiple resources and skill which is
different from there competitors. Oak Cash & Carry preferred highly skilled worker and
technology that help in production to save time and money.
Porter generic model :
For the growth of small scale industry organisation use different framework for gaining
competitive advantages. For this organisation need to determine its direction or strategy. Michael
porter uses 4 strategies that an organisation can select from. He believes that a company requisite
choose a clear course in order to beat the competition . The four strategies to choose from are
explain below:
Cost leadership: This leadership is define as traditional method to achieve its objective
of producing product on large scale that enables business to exploit economies of scale. This
target on a broad market and offer lowest possible price. In this organisation need to keep costs
as low as possible (Shi and et. al., 2012). Company make sure that they have larger market share

with there average price. In this the main aim is keep company cost low as possible. If company
like Oak Cash & Carry use this then they focus on offer lowest price to its customer. This
organisation can provide discount to its customer for increasing in sales.
Differentiation leadership: In this strategy of porter, company add some unique feature
in there product which make them different from competitor. In this company target the broad
market by offering unique product in market. This help in make product unique then their
competitor. Oak Cash & Carry focus on the expansion and growth because this concentrate on
large market place and provide unique feature in their product.
Cost focus: This is focus on cost of the product .This strategy focus on niche market and
offer lowest price to its customer. In this company produce its product according to the demand
of its ultimate customer's (MacLeod, 2013). This is general when company use low cost in there
product then they can provide there product to its customer at low price. When the price is low
then the demand is high.
Differentiation focus: This strategy involves strong brand loyalty among customer. Oak
Cash & Carry make sure that there product remains unique in order to stay in possible
competition. Company sell its unique feature product in niche market.
For Oak Cash & Carry cost leadership is best strategy. In this when the cost of product is
decrease the price of product is also decreases. This cover the large are of market which incrses
the sales in the organisation.
PESTLE analysis:
This is analytical tool which help in study the external factor of the organization. this
pestle includes political , economic , social , technological , legal and environmental . this factors
are explain below:
Political: this factor include government intervention. This factor important for
maintaining political stability to operate business. This factor include government policies ,
internal political issues, tax policy and trading policy that have impact on business. Tax of rate is
levied by the government which help Oak Cash & Carry (Deakin, 2012). This factor consider tax
rate which low and give positive impact in the business.
Economic: This are define to determine for economic performance that give directly
impact and give long term effect. Economy factor include inflation rate , interest rate and
exchange rate. This are the factors which affect the purchasing power of the customer. In UK

economy level level is very good which encourage the purchasing power of customer. This work
effectively for Oak Cash & Carry . This increase the sale of the organisation when the economy
level of country is high.
Social factor: this factor is define as the standard living of people. This factor includes
norm , custom and values which organisation should follow. In social factor there is also brand
and company image involved. This social factor help an organization to create postive image in
the mind of the customer. Oak Cash & Carry produce the product according to the culture, value
which help in attracting customer and in increasing sales.
Technological factor: This are the factor which is related to the technology , level of
innovation, automation. The more Oak Cash & Carry technology is emerging they more
productivity is increases (Barbour, 2018). This factor help in developing and upgrading the level
of working. In Oak Cash & Carry use different innovative technology which help increasing
sales of organisation.
Legal factor: This are the factor which is focus on employment law and consumer
protection. Oak Cash & Carry should follow all the rules regarding Protection of employee.
Environmental factor: This factor consider impact of whether and ecological that have
effect on function of the organisation. This factor include internal and external factor. They both
factor effect environment of organisation. Oak Cash & Carry is company transfer its good from
one place to another place .
P2 Opportunities for growth by applying Ansoffs growth vector matrix
It is very important in the organisation to give opportunity to grow in the market this help
in achieving the competitive advantage. when the organisation have opportunities to grow and
choose various technology that help in expanding the businesses.
Ans-off matrix is define as the marketing planning tool which help an organisation to
increase the growth of the business (Chapin, 2012). This model is effective in know the different
which help in increasing the growth of the business this ansoff matrix is explain below:
Market penetration: In this the organization focus on to achieve growth with its existing
products in there current market. The aim is to increase its market share. This strategy known as
the least risk strategy. With growing market maintaining market share will result in growth of
business. In this Oak Cash & Carry should uses its product in the existing market and aim to
increase its market share. This strategy can be done in various way. Oak Cash & Carry can

decrease the price of its product so that more customer attract toward there product. The have to
high the level of promotion and distribution efforts. Organisation should have the knowledge
about its competitor in the market that they can beat it.
Market development: It is about selling organisation existing product into a different
market to different customer. In this expanding new business in new market means into new
customer segment and region. This can be done in a different ways that is expanding in new
domestic market and entering into a foreign market. Oak Cash & Carry can use the online
channels to sell there product into new market at lower price. They can sell there existing
product to its new market segment and with various customer's.
Product development; this is define as changes in product of organization. It very
important for the organisation to do change and update its product according to taste and
preference of customer (Ziari and et. al., 2012). According to the time taste and preference of
customer is getting change organisation should consider this point. Oak Cash & Carry use the
web to add value to or extend existing products and services. Oak Cash & Carry can done this
strategy in many various way. They have to invest in research and development so that with
research they can analysis the market and taste and preferences of the customer. Organisation
should make sure that the product meet the need and preferences of existing market.
Diversification: This is about move into new market with the new product. This can be
the risk term for the organisation. Diversification has its two type that is related diversification in
this there are potential synergies between the existing and new product (Todes, 2012). Another
one is unrelated diversification in which there is no potential and synergy between exiting
business and new product .Oak Cash & Carry should move to the different which create more
customer and this help in increasing the sell of company.
TASK 2
P3 Potential sources of funding available to businesses and discuss benefits and drawbacks
Finance has become important aspects for every business firm to operate on an effective
and productive basis. This is very prominent factor, in which business firm buys raw materials,
arrange effective labour as well as provides remuneration to business workers. In order to do
manage things accordingly, it is necessary for business firms to arrange funds from different

sources such as angel investor's, crowdfunding, bank loan etc. In context with given business
entity, there are two different ways of arranging funds such as internal and external sources.
Internal sources of funding: In this sources of funding, majorly priority is used to be
given inside money sources such as retained earning, capital reserve etc. These are basically kept
money with business entities. These sources of funding are basically high secured and protected
with own efforts.
External sources of funding: In this kind of funding, major focus on arranging funds
from outside structures such as banks, financial institution, money lenders, outside parties etc., as
these have major support of getting money in early point of time. In addition to this, business
entities are required to pay back these funds in an early period of time (Zolfaghari, 2012).
In context with Oak Cash & Carry, funding is very necessary to generate their massive
expansion of business operation with support of their strategic planning & directing in context of
raising funds. In context to expand business operation at an optimised level, Oak Cash & Carry is
required to go for certain level of funds access such as Angel investors, crowdfunding, bank loan
and financial institution. Oak Cash & Carry have several other sources of major funding for their
business expansion are as follows:
Bank loan: This is a convenient sources of receiving funds from the bank system in
return for future repayments with calculated interest amount. Repaying of the loan amount
depends for how much time duration loan taken and rate of interest to be levied (Jaber, 2016). In
context with Oak Cash & Carry, bank loan is a best way to generate money & funds for
conducting activities of this business firms.
Advantages:
 Bank loan is a convenient option in comparison to overdraft, as it allows lower interest
rate and money will be keep for longer period of time.
 Another major advantage is to get tax benefit, which says amount pays as a interest have
major beneficial on paying tax amount.
Disadvantage:
 A major limitation of bank loan is undertaking borrowing on that higher level that I may
lead to reduction in cash flow of firm.

Angel investor: This is a kind of an equity financing, in which different investor's
supplies funds or money in exchange of giving position or share in equity holding of the Oak
Cash & Carry. In this business entity, This way of generating will be best suitable to enhance
funds raising in any period of time. This may lead to strategic planning & effective relationship
with angel investor to indulged them into effective functioning.
Advantages:
 The merit of this source of funding is increased level of financial support to business
entity.
 In this source of raising funds, this is highly prominent way to get access of funds in
given period of time.
Disadvantage:
 Using source of angel financing as a major source of fund, it has major disadvantages that
it will also takes long time to find a suitable investor.
Peer to peer lending: This is an ease method for raising of higher funds that basically enables
an individual person to lend & borrow funds with a use of banks or financial institution. For
purpose of Oak Cash & Carry Ltd, peer to peer lending system would remove middleman in an
entire funds raising process, but this process of making funds raising is more risky and also time
consuming as compared to other sources of fund.
Advantages:
 The major benefit of peer to peer money lending is that, there is an access to the major
higher returns, as this has lower interest rate.
 In peer to peer lending, interest rate is fixed and also monthly payment are available with
prevention of no upfront or hidden fees.
 Another advantage of this method is there is no prepayment penalty.
Disadvantage:
 A major drawback of peer to peer funds money system is that money might not be lend as
and when required.
 Also, other disadvantage of this funding lend method is an amount of interest, that doesn't
garmented over tax refunds.

TASK 3
P4 Design business plan for growth that includes financial information and strategic objectives
Business plan is an effective tool or techniques by which manager of Oak Cash & Carry
can do curriculum planning for business operations will work or how targets can be achieved
(Glock, 2017). Hence, it is prominent for Oak to have business plan which will assist in
expanding business operations and measures growth for longer period of time.
Overview of the company: Oak Cash & Carry provides cash and carry services.
Business offers a wide range of services or products in bulk for retailer's, offices, off-licences
and other local business. This business entity is engaged and working in United Kingdom.
Products & services: Oak offers offers services related to the cash and carry and also led
to provides wide range of products in bulk quantity to retailer's, caterers, offices, off-licences and
local businesses at a profit level.
Vision & Mission: The vision of Oak is to “Deliver customer till the last breath and life
time” and mission is to grow operations at a consistent level of increasing scenario of profit
build. Their core values are highly comprises of an effective use of business ethics and also
increased performance at a greater level of working.
Strategic objectives: The major strategic objectives of the Oak Cash & Carry is to build
their business operations by 2 percent annual growth, increasing higher and higher tangibility
and composition of the services. Manager of Oak has been classified objectives into SMART
goals, which they have identified it as specific, measurable, attainable, reliable and time bound.
Entrepreneurship strategies: Oak Cash & Carry in their initial period for Niche market,
means doing business operation in limited market to grab initial opportunity to raise profit basis
to run business for longer period of time. Their target market will be dealer, business entity to
want to get renders Oak services in an ease period of time. In further period, it is much
provocative for Oak to led starting of their business operations from a stage of non-functioning
to productive operations.
Financial information; In this executing level of an information, total budgeting making
and cash flow budget will be prepared to ascertain cash generation for business expansion of Oak
cash & carry. This will be majorly prepared after deciding sources of funds such as Angel
investor, retained earning and bank loans, which has led an initiatives to provide ease access of
the funds at given period of time.

Total forecasted budget
Particular 31/12/18 ($) 31/12/18 ($) 31/12/18 ($)
Implementing
technology cost
123466 -There are various
companies in business
environment. Firm
which are successful,
wants to expand more
than they must
formulate better
succession plan. There
is possibility that Azio
does not able to work
effectively and can not
meet their set
objectives. Than it is
very necessary for
manager of company
to formulate exit and
succession plan. There
are various strategies
that can be used for
entry and exit plan
which are as follows:
-
Promotional expense 5000 8000 8000
Advertisement
expense
5688 5600 7000
Catalogues 4688 4000 5000
Training charges 8900 8000 10000

Total Cost 123899 25600 30000
This given budget shows that Oak Cash & Carry are spending their large pieces of
expenses on setting up of the technology to announces business functioning at a growing stage or
time to led increase in business profitability.
TASK 4
P5 Assess exit or succession options for a small business explaining the benefits and drawbacks
Expansion of the business functioning has not declared always with positive results, there
always possibility of negative outcomes also. Along with this, negative results may led to major
failure into the business process. There are various tools or techniques, through which business
firm's can enhance their goodwill and growth of business, which are also possible. Managers of
Oak Cash & Carry Ltd., needs to be formulate a plan for establishing succession & exit for
effective business operations.
Different ways of succession and exit strategies
In business process, there are various types of operating firm's which are nutshelly
operating their business affairs to expand more than what they must do formulation of better

succession plan. There is a higher possibilities that Oak Cash & Carry Ltd does not able to work
effectively and can not meet their set objectives. It is very necessary for manager of Oaks to
formulate exit and succession plan at same point of time (Sharifi and et. al., 2014). There are
various strategies that can be used for entry an exit plan which are as follows:
Winding up: This method of exit plan means ending or dissolving a business by selling
its assets to paying off all liability and remaining assets distributes to their shareholder or
partners. It is an end the trading life business by putting company into formal liquidation
(Parolin, 2013).
Advantages: The major benefit of winding up business is it removes the responsibility from the
directors and the business owners. When company is winding up than there is no ongoing
pressure of debt repayment. So, the available fund may be used as other business opportunity.
Disadvantages: Drawback of winding up business is, it is time consuming process as there is
legal procedure for liquidation. Another limitation of this method of exit is company will loose
the productive employees and teams.
Selling in open market: In this method, exit plan is selling ongoing business in open
marketplace. The image of company is not disturbed as other company will purchased. There is
rebate in taxes to other party who buy it.
Advantages: One of the major advantage of selling business in open market is there image of
company do not get disturbed. It also helps in improvement in economy of country. Operations
of business not changed as other company purchase their ongoing business.
Disadvantage: Drawback of this method is financial status of company is comes in front of
external parties and this leads to reduce the image of company. This affects the reduction in
value as compared with other organisations. Another drawback of the exit plan is skilled
employees may leave the firm which affects the functioning of company who purchase that firm.

Merger & Acquisition: Merger means combination of two business to form one company.
Acquisition means taking over other company (Williamson, 2015). These two are the major
factors of corporate world.
Advantages: Benefit of this is synergy that means magic power i.e. useful in increased value
efficiency of new business and it also gains the economies of scale as they share resources and
services. Another limitation of this method is it reduces the risk of using innovative techniques
and tools for managing financial risk. There is one more benefit of this is it has tax benefits.
Disadvantage: Drawback of this method is company may looses the experienced staff member.
Merging of two company leads to doing similar things and may be there is duplication of work.
Another limitation of this exit plan is it increases the cost of company that results in management
of modification and there is delay in implementation of merger and acquisition.

CONCLUSION
From given report, it is concluded that planning is necessary to led effective initiation of
the growth and expansion of the business performance of firm or entity. Source of funding has
become important to led an initiative to make business perfect and also suitable to raise business
performance at a bigger and optimised level to increase performance of business enterprise.
Making a business plan has been resulted into think strategically to enhances business operation
of the company at a utilised stage or level. Exit or succession planning has simply led business
entity to close their business peaceful and also without support of any kind of informal business
loss, with the purpose to generate level of profits and its suitability.

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