Planning for Growth

This report discusses the strategies and opportunities for business growth and expansion. It explores the use of Porter's generic model and Ansoff's matrix to assess growth opportunities. It also examines the sources of funds for business expansion and the importance of a well-developed business plan. The report focuses on New Car Deals Ltd, a family-run small enterprise in Houbury, UK, and provides recommendations for its growth and expansion.

Planning for Growth

INTRODUCTION
In order to expand and grow in market it is important that businesses plan for their
growth strategically so that they can continue to survived and sustain in the competitive market
environment. The resources need to be prioritized and allocated in such a manner that they help
in achieving company goals of expansion and gain a competitive edge over its rivalries. Growth
planning also help in dealing with challenges faced by businesses during their growth in a
systematic manner (Zhou and et. al., 2017). In this report New Car Deals Ltd which is a family
run small enterprise in Houbury, UK is taken. The company help in arranging for car deals at
low prices without charging extra fees and also arrange for rental cars. It now plans open small
and easily accessible agent shops and offer car deals on luxury cars so that its market can
expand. In this report the ways through which companies can grow in market, sources of
acquiring funds, evaluation of growth opportunities etc. will be discussed in detail. Further a
business plan for the company will be made along with the ways through which succeed or exit
the market.
TASK 1
P1)
There are various strategies that can be used by New Car Deals so as to assess the
opportunities to grow in the market which can help it in increasing its sales and increase its
customer base. Some of the strategies are discussed as follows:
Porter’s generic model: Cost leadership: This strategy helps a company in becoming a cost leader in market by
lowering its prices so that the customers can be drawn towards low prices which can help
in enhancing the competitiveness of company. New Car Deals can use this strategy by
getting car deals arranged at lowest prices than its rivalries through which it can attract
more customers and increase its sales (Young, 2016). Differentiation: Through this strategy company offers distinguished products and
services to its customers so that customers can be attracted and competitive edge can be
gained in market. The company can differentiate its service by adding special features
like offering free 3 services to their customers making them better than their competitors.

 Cost focus: In this small market is targeted by lowering the cost so that target customers
can be drawn in a that particular market. New Car Deals can lower the prices of car deals
in Horbury so that only the local customers can be targeted.
 Differentiation focus: In this strategy differentiated products and services are offered in
niche market so that only a segment or targeted customers can be attracted. NCD can use
this strategy to offer differentiated services like 3 free services in Horbury. This will help
in making the strategy successful in a niche market.
From the above discussion it can be said that focus strategies can help New Car Deals Ltd in
amplifying the competitive benefit in Horbury so that high revenue can be earned in a particular
target market.
PESTLE analysis: This is a strategic management tool which helps businesses to analyse their
macro environmental factors so that they can take strategic decisions to deal with negative
impacts of these factors. Political: These are the rules and regulations of ruling government of country which
determines tax rates, trade tariffs etc. As UK is a politically stabilized country which
means that the its policies remain stable which can help NCD to expand its market
without getting worried about the fluctuations in country rules (Todes, 2014). Economical: These factors are related to country economy like unemployment rate,
interest rates, GDP, purchasing power etc. UK has a strong economy with its people
having high buying ability which means that New car deals can start making deals in
luxurious cars so that the customers can get cars deals at low prices. Social: These factors are related to the society of country which is composition of
different demographics, culture, religion, age, sex etc. As the people in UK have good
standard of living it can help New Car deals in expanding its business so that its
customers can be provided with profitable car deals. Technological: This factor is related with the rate of R&D that takes place in a country
and technological advancements in the country. UK is highly technologically innovative
which can help New car deals in using technology to reduce its prices through which car
deals are made so that high revenue can be earned on each deal. Legal: These are the laws of country which affect the operations of company so that they
can exist under the legal framework of country like following employee legislations etc.

New car deals can follow all the legal laws of UK so that it can gain the trust of its
customers and employees which can help in increasing its business.
 Environmental: These are the environmental factors of a country like availability of
resources, pollution etc. UK follows many laws to protect its environment which means
that NCD need to abide by all the laws and make deals with car that do not harm
environment and increase pollution in UK (Sarin, 2019).
P2)
The Ansoff’s matrix can be followed by New car deals so that new opportunities can bee
found in the market which can help in strategic growth of business. The matrix was developed by
Igor Ansoff which can help in choosing the best strategies: Market penetration: In this strategy company offer existing products in existing markets
by decreasing costs so that more customers can purchase company products. New car
deals Ltd can use this plan of action by increasing offers on making car deals and by
offering customer friendly services to its customers which can help in increasing
company sales. Product development: In this strategy company try to sell new products in existing
markets so that the needs and wants of customers can be efficiently met. New car deals
Ltd plans on opening new small agent shops so that sales can be increased in existing
market through improved services. The shops will be easily accessible for customers of
existing market which can help in increasing sales. Market development: Under this strategy new markets are searched for offering existing
company products. New car deals under this strategy can offer its existing services which
are to make car deals with customers so that they can be provided with efficient deals at
low prices. This can help in increasing company sales in new markets so that its profits
can be increased (Plotnikov, Fedotova, Popkova and Kastyurina, 2015).
 Diversification: In this the company increase its sales by providing new products or
services in new markets so that a new customer base can be created and company can
expand its business. NCD Ltd can use this strategy to offer car deals and rentals in
luxurious cars at place other than Horbury which can help in its expansion.
From the above it can be analysed that the best strategy which can be used by New car deals
is diversification which can help it in expanding its business strategically. The company can

open its agent shops in locations other than Hurbury and offer new deals in luxurious cars so that
efficient and cost effective deals can be made for customers which can help in creating a loyal
customer base. This can thus help the business to grow and expand in market and achieve a
competitive advantage (Mason, 2015).
Growth option that can be chosen by company
The company can select an option to grow in the market and most suitable growth strategy
for New car deals Ltd is focus strategy which can help it in offering its services in a particular
market through low cost and differentiated services. It can build a strong reputation in niche
market and can also attract the target customers so that number of sales of company can increase
and high profits can be earned.
Critical evaluation of growth options along with risk associated
The growth strategy which can be adopted by New car deals Ltd is focus strategy to expand
its market however it can face some risks and challenges in doing so like through cost focus the
company will decrease its prices to customers which can affect its profits. Also through
differentiation focus the company will have to bring change in its existing services which lead to
increase in company cost. These strategies can help in accelerating company sales thereby
increasing its profits and so they must be strategically applied so that the risks do not bring down
the overall profits of company.
TASK 2
P3)
In order to grow and expand in market a business requires sources of funds so that the
investment which is required in business expansion can be accumulated. Following are certain
sources which can be used by New car deals Ltd:
Internal sources: When the funds are collected by business from internal sources like selling
company assets, reserved profits reinvested in business, collection of debts etc.
Advantages Disadvantages
Internal sources of finance can be controlled by
the owner of business and are economical as
The internal sources can affect operating
budgets, gives less tax benefits and can fall

compared to the external sources. Also they do
not have to be paid off after certain period of
time and the hold of money remains with the
owner.
short of the actual budget requirement thus
delaying the project and increasing business
risk.
External sources of finance: These are the financial sources from outside the business which
can help in collection of funds with a promise of repaying it back along with the interest amount.
The advantage of using these sources are that they can help in accumulating a large amount of
fund through which new project can be started. The disadvantages are that these sources are
expensive and cannot be controlled by business owner. Some of the external sources are: Bank loans: These are the financial institutes that provide funds to the company in return
of some security so that the borrowed amount can be made reliable to getting paid off in
full amount along with interest. Benefits: Bank loans are easy to get which can help in
accumulation of quick loans. The interest rates charged by banks are relatively lower than
other sources of funds. Drawbacks: The bank loans are to be paid on due date and the
failure in payment can affect business negatively. Interest rates can increase burden on
borrower (Li, Mobin and Keyser, 2015). Crowd funding: In this funds are raised by businesses through raising funds from
individuals or organisations in return for potential profits or rewards. In this a large
number of individuals are involved with each contributing a small amount to the actual
funds raised. Benefits: The funds can be raised easily and the costs involved are very
low. These funds can help in accumulation of a large amount which can help in
successful expansion of business. Drawback: It becomes difficult to accumulate funds
for small businesses as there is a lack of trust among people with small businesses. Also
it is time consuming process with uncertainty of desired collection.
 Angel investors: When financial support is given to small businesses or start-ups by some
investors who have high net value are termed as angel investors. These investors can help
in generating small amount of funds so that support can be gained through their
investment. Benefits: There is no requirement to pledge any asset by company so as to
get this investment. The interest amount is zero in this type of investment which helps in
relieving the stress on business owners. Drawbacks: It is not beneficial for companies

requiring high amount of investment. There is an uncertainty on the amount which can be
collected through this method (Lambert and Oatley, 2017).
From the above discussion it can be said that bank loans are the best option available with
New car deals Ltd so that investment can be collected for expanding its business in an efficient
and effective manner.
TASK 3
P4)
The term business plan can be defined as a written document that demonstrates objectives,
goals, plans and strategy of organisation. The main motive of business plan is to complete
organisational projects within minimum time period. Moreover, business plans contains financial
objectives, background, purpose of organisation that leads company to achieve more success in
market.
Executive summary- New car deals are operating their business in automotive sector and it
is family based business. This is based in Horbury and provides professional services to its
clients. Along with this company aim to expand it business by introducing new automotive mode
and feature in vehicle to provide better products and service to customer.
Vision- Company aim to increase their market area and customer satisfaction through
offering better services to its customers to offer better mode in automate vehicles (Frank and
Reiss, 2014).
Mission- To fulfil customer needs and wants in minimum period by providing organised
services.
Objectives- The company introduces new modes at affordable prices to provide better
experience through offering new and innovative modes. The main concern for organisation is to
increase customer base with 35% within duration of three months.
STP framework- The framework steps related with STP is used by organisation to identify
most attractive segment in market. This result target of company is achieved in proper manner.
Some steps related with new car deals is mention as follow:
 Segmentation- This work as a framework that leads company to divide market into
various segments and needs that meet with organisation in cost effective manner.

Further, it is divided into geographic segment and behavioural segments that identifies
potential locations for business.
 Targeting- Company target those individuals that prefer various modes in their
vehicles such as professional drivers who used vehicles on daily basis. Along with this
managers also try to target tour and travel companies.
 Positioning- it is mandatory for organisation to position all products and services in
proper manner to advertise and deliver all services and products with in proper manner
Resource allocation- This is mandatory for new car deals to allocate all resources in sequence
which assist company to perform work strategically in organisation for achieving organisational
goals and objectives within stipulated time frame (Dyker, 2013).
Budget- Overall budget to ascertain company expenses is as follow:
Particular 31/12/20 (£) 31/12/21 (£) 31/12/22 (£)
Implementing technology cost 15000 10000 7000
Promotional expense 10000 9000 7000
Installation of machines 20000 12000 5000
Shop expense 8000 8000 8000
Training charges 7800 6700 5600
Total Cost 60800 45700 32600
Cash flow statement- The cash flow statement determines actual flow of cash that determine
business operations and its cost to analyse inflow and outflow of cash. This also includes
activities and investment related with given time period.

With above cash flow statement it is analysed that firm must provide sufficient cash and
monetary expenses to pay all expenses related with business existence in market. Net cash flow
$7700, $200 and $1300 for years 2021, 2022 and 2023 that provide positive perspective and
availability of cash.
Monitoring and controlling
This is essential for organisation to control and evaluate all activities that help to control
all companies operations. In context of new car deals expenses are monitored to utilise monetary
aspects in possible manner that maximise overall quality of result. KPI and analyse from
feedback also work as performance that complete project as per desired objectives and goals that
maintain quality and cost of new projects.
TASK 4
P5)
Success related with plans work as a strategy that leadership roles and ownership in an
organisation. This is also used by management to work as a capable leader that leads success for

longer period. Merger and acquisition are more beneficial to achieve success in market which are
mention as follow:
Merger- This work as an agreement in which two and more companies merge together to
perform operations and functions that is leading them with new name (Crow, 2015).
Advantages
 Better economic scale is gained by management that leads organisation to perform
work for gaining better results that increase overall efficiency.
 With new company organisation is more benefited within market that provides more
benefits to company.
Disadvantage
 Coordination among employees and workforce is more difficult that generates
complexity in management. Due to changes in market share and prices company faces conflicts among leaders to
make decisions.
Acquisition- When an organisation purchase asset and share of other organisation that
acquire making the owner to make decisions. It is important to purchase most asset for
organisation that leads to gain ownership in market.
Advantages
 Market share of organisation increases due to acquisition within a company for
enhancing its business that enhances market area.
 Experts also lead company to acquire more competencies in market that offers more
resources and availability of materials due to which task are completed within proper
manner.
 With more number of professionals are involved in decision making this results it is
easy for organisation to complete task with more efficiency.
Disadvantages
 Due to changes in companies and acquisition between companies management of both
companies face difficulties to complete project.
 The high raise in demand of products also impact on prices of products. It refers more
demand also increases prices.

 Strategies of both companies are different from each other due to which acquired
company employees face challenges to manage work (Al-Bostanji, 2015).
In the context of new car deals management is focused to perform their work with techniques
related with acquisition that expand market area. It leads organisation to gain better results that
strategically utilise company resources for satisfying customer needs in effective manner in order
to improve brand value of company and its products in market.
CONCLUSION
From this report it can be said that in order to grow and expand in the market it is important
that market conditions are efficiently identified which can help in evaluating the opportunities
that are available. Porter’s generic, Ansoff matrix etc. can be used to determine the strategies
which can be used by business to grow strategically in market and grab opportunities so that a
competitive advantage can be achieved. Various sources of finance can be used by company to
expand. Business plan is an essential part which help in the expansion of business by
determining the direction through which a company must follow to grow strategically.

REFERENCES
Books and Journals