Planning for Growth: Key Considerations, Funding Sources, Business Plan, and Exit Options

This document discusses the key considerations for evaluating growth in business opportunities, including access to customers, financial components, skill set required, diversification, and market analysis. It also explains Ansoff's growth vector matrix and its application in developing growth strategies. Additionally, it explores potential sources of funding for SMEs, such as venture capital funding, angel investors, cash advance, and crowd-funding. Furthermore, it delves into the importance of a business plan for growth, including financial information planning and strategic objectives. Lastly, it examines exit options, such as liquidation and selling the business to another company, with their benefits and drawbacks.

Planning for growth

Table of Contents
INTRODUCTION...........................................................................................................................3
LO1.................................................................................................................................................3
P1 Key considerations for evaluating growth in business opportunities.....................................3
P2 Ansoff's growth vector matrix:...............................................................................................5
L02...................................................................................................................................................6
P3 Potential source of funding with benefits and drawbacks......................................................6
LO3..................................................................................................................................................7
P4 Business plan for growth........................................................................................................7
LO4..................................................................................................................................................8
P5 The exit options with benefits and drawbacks........................................................................8
REFERENCES..............................................................................................................................10

INTRODUCTION
Small medium-sized enterprise is defined as companies who establish their new business
in form of independent company with less than 500 employees. These emerging new companies
are the backbone of an economy. In this report the key considerations taken by a SME company
for evaluating growth and opportunities in economy is explained. Verdant Leisure has been taken
as the SME which is a luxury holiday park destination offering self-catering lodge services,
holiday home ownership across Scotland and northern parts of England.In this report the analysis
of key-terms and factors which demonstrate the understanding of competitive advantage, steps
taken for growth and risk mitigation steps taken by company is explained. The main sources of
funding available to business, with the benefits and drawbacks are explained. In this report the
benefits of business plans including the financial information and objectives for scaling up the
business on a large scale platform is explained. In this report the vision and goals of Verdant
Leisure as a fast spreading small medium-sized enterprise, the points of expansion undertaken
and various management strategies to upgrade its business is explained.
LO1
P1 Key considerations for evaluating growth in business opportunities
SMEs can be understood as large part of the UK economy, boosting SME productivity
growth levels would have a significant impact on the overall UK productivity. Innovation and
expansion in market according to the competitive industry and building a dynamic market
environment with changing consumer demands is an important step taken by emerging
companies for enhancement in their position in the industry.
Access to customers:The access to customer is one of the key consideration for evaluating
growth and business opportunities for Verdant Leisure as it aims to provide freedom and
flexibility with a comfortable holiday experience with exciting adventure parks and tranquil
escapes (Aremu, Shahzad,and Hassan, S 2020).The company offers a relaxed environment with
spectacular locations across Scotland and Northern England with self-catering lodges and many
activities to spend quality time in their bespoke leisure parks. The access to customers and the
way they communicate their services is definitely a key consideration in measuring the growth in
business opportunity for a SME. This justifies as company has online websites and portals for

easy access to customers for booking their holidays, get information related to all services and
the details of picturesque spots where they can finalize their holidays.
Financial components: The financial components are important factors for evaluating the
business opportunities in SME. Evaluating the financial resources is crucial for small sized
companies to enter the marketplace, the inputs in form of inventories and how much market
return it needs for keeping the profit margins high. This consideration justifies that company
focuses on using the financial components wisely and evaluating further business growth
opportunities by increasing the financial capital in company.
Skill set required: The skill set required in management teams is definitely an important
consideration for evaluating the business opportunities in growth of company. Management
teams should be trained with efficient skills for hosting guests and giving them a good hospitable
stay. This consideration is justified as Verdant Leisure aims to provide proper training and skills
of hospitality in the management teams for giving satisfied customer services.
Diversification: The diversification or the extension in services with the dynamic attitude to
spread in the competitive market is a key consideration for evaluating growth opportunity of a
small sizes enterprise. This consideration explains the justification with the wide range of hotel
stay services, entertainment activities and attractive locations it offers to all customers. The
company aims to be diversified and adopt dynamic business culture for spreading its market
reach.
Market analysis: The analysis of market share is a key consideration for an SME to consider
when evaluating the business opportunities. Analysing the market share of competitive industries
in economy, how much financial funds it needs to pool in for establishing a prominent place in
the industry is important for evaluating the business opportunities. The justification is done as
gives immense importance in boosting the productivity levels of its hotels and keeping up with
the customer satisfaction levels.
Opportunity identification: The analysis of opportunity identification is a key consideration for
an SME to establish business growth and evaluate the future opportunities. SMEs should identify
the strengths and opportunities where they can establish their business and how to expand with
further growth by understanding the customer needs, trends and insights of industry.This
consideration is justified as it lays importance in identifying the growth opportunities it possesses
and work in dynamic environment.

P2 Explaination on Ansoff growth vector matrix:
The opportunities for growth and development by applying Ansoffs Growth Vector
matrix can be understood as it focuses on four key strategies to develop future growth in market
which are Market Penetration, product development, market development and diversification. It
assists to get new customers, high revenue and grow by developing the marketing strategies.
Proper implementation of the Ansoff Matrix's helps small medium-sized enterprise to increase
the market share, develop the product and services with better quality and innovation. It aims
companies towards increasing the market spread demographically into new segments of
customers, regionally and also keeping the profit margins positive along goals of company.
MARKET PENETRATION: This strategy aims to focus on increasing the slaes of existing
products and services to extend in the market share for increasing customer's satisfaction levels
and target the new customers with different variety of services and advanced product services.
Verdant Leisure focuses on market penetration by increasing the numbers of parks and hotels for
people who look towards having a comfortable hotel stay along various entertainment activities.
It aims to target young people who look for adventure activities in their holiday stay by
promotion of the various parks and attractive prices along discounts.
PRODUCT DEVELOPMENT: This strategy expalins how company can focus on expanding
the products and services along demographics and targeting new customer segments. This
involves extensive research and development with focusing on key points of competition with
other companies in the same market. Verdant Leisure focuses on including new services with
attractive hotel stays all over country for travellers and people who look forward to enjoy the
British heritage. It aims to get the completive advantage among other emerging new hotels with
the new services and various locations to its customers to choose from.
MARKET DEVELOPMENT: This strategy focuses on entering new markets and expanding
the market geographies by catering to different customer segment, expanding regionally and
expanding internationally. With hospitality industry being a highly competitive market in
growth, the company aims to build a substantiality with targets to spread on large scale to pool
large number of customers. Verdant Leisure aims to increase the market by expanding into new
segments of people, increasing the market share of parks and hotels. It can develop the
competitive advantage for itself by bringing in uniqueness for its services in comparison to other
competitors.

DIVERSIFICATION: This strategy aims to focus on how company can enter a new
marketplace with new variety of products and services.Diversification enables company to
evaluate the business opportunities in the future, the growth potentialities in new market areas
and by introducing new diversified range of services (Ayunku and Eweke, 2020). It helps SME
to position themselves strongly in the competitive industry and evaluate their future
performance. Verdant Leisure has a dynamic business approach where it keeps on diversifying
the services and the hotels by working towards customer satisfaction. It aims to get completive
advantage in the hospitality industry of UK which is highly diversified with increasing number
of new companies emerging.
L02
P3 Various Potential source of funding with benefits and drawbacks
SMEs are a large part of the UK economy, and by boosting productivity growth it would
have a significant impact on overall UK productivity. With Innovation and expansion with good
access to financial resources and building a capital growth is a critical factor for growth and
increase the scale of supply and services.
The various methods and potential sources of funding are:
Venture capital funding: These can be understood as investment funds that mange the money
of investor people who seek private equity stakes in start-ups and small medium-sized companies
with growth potentials. The primary advantage of Venture capital financing to Verdant Leisure is
an ability for company expansion in the future and smooth functioning with large amount of
financial resources. The drawback of financing the capital resource in company through Venture
capital funding involves high risk return. The procedure to get VC funding involves a lot of legal
procedures to be followed by start-ups.
Angel Investors: Angel investors can be understood as people who invest in new or small sized
business venture providing capital for start-up or extension. They are investors who look for
higher return rate than would be given by any traditional investment method. It is a form of
equity financing in company where the investors supply funding in exchange by taking an equity
position in company. The big advantage for Verdant Leisure is that financing investments from
angel investors is much less risky than debt financing. Unlike a loan, the invested capital does
not have to be paid back in case of any loss and most angel investors understand business as a
long term view. The disadvantage of angel investors is it is not always easy to attract them and

there is a loss of complete control in decisions and profits of businesses as he will also have a say
in running of company and proportion in profits.
Cash Advance: Cash advance is a short term loan from bank or an alternative lender. This refers
to services provided by many credit card issuers allowing cardholders to withdraw a certain
amount of cash. It can be a method of funding when company does not have enough cash on
hand at certain time (Gherghina and Simionescu, 2020)
The benefits of cash advance is that it is easy to get relatively and it doesn't require any money
available in any account for the company. But disadvantage of cash advance charge a pretty
hefty price in form of high fees and interest rates which can be an important concern for start-
ups.
Crowd-funding: Crowd-funding is the practise of funding a project or venture by raising small
amounts of money from many people, typically by using internet. The advantage of crowd
funding for Verdant leisure is that company can promote the business goals to people for crowd-
funding which means the business customers becomes the most loyal customers. The
disadvantages in this method are that return is not guaranteed and the platform must go bust in
order to take funding at large level.
LO3
P4 Business plan for growthin the marketshare
A Business plan can be understood as the process of developing a framework which
serves a number of objectives, planning and organizing the usage of all resources in company. A
business plan includes a comprehensive financial assessment that includes funding needs, setting
goals and steps to implement the market growth with proper penetration strategies to scale up the
business.
Financial information planning: Financial planning includes every aspect of finance in
company, investment planning and the goals and objectives of company specifically. It also
includes keeping the financial reports of company presentable for investors, maintaining the
profit margins and scaling up the targets to spread in economy (Dunkley, 2020). Determining the
financial goals for company, setting up the alternatives and planning the alternatives with
revising the plans. The potential sources of funding the financial resources in Verdant Leisure
are through Venture capital funding, angel investors, crowd-funding as they offer lucrative
advantages in form of high investment rates and large level funding by angel investors as well.

Through proper investment company enables long term stability with strategically implementing
the financial goals and increasing the market share.
Strategic objectives for scaling up the business lecvel and increasing the performance
standards
 Expansion- By properly planning various strategical steps for expansion business plans of
a company, it enables growth of the market share, profit margins by increasing the sale
and customer satisfaction levels with inclusion of new products and services.
 Customer satisfaction- Verdant Leisure aims to keep the customers satisfied with services
and work towards formulation of business plan which helps in enhancing their services
 Qualitative services: This is strategic objective of Verdant Leisure which aims to provide
good quality services to all people in their hotels.
 Innovation- This is the strategic objective where company aims to innovate in their
services, bring new changes and scale up their business in comparison to other
completion in markets.
 Financial growth- Verdant Leisure works on making business plans keeping the financial
growth strategy objective in mind.
 Long term stability- This strategic objective of Verdant Leisure aims for long term
stability in the market which ensures long term customer loyalty.
LO4
P5 Exit options with benefits and drawbacks
The exit options for a company are taken when the business goals in context to financial
goals are not reaching the margin levels. The company is not able to successfully use its
resources to useful use and its facing losses with increase in liabilities. There are a number of exit
options available to company:
Liquidation: It means the process of bringing down a company business to an end and
distributing all assets to claimants. It is a strategical step taken by company when it becomes
insolvent and is not able to pay the obligations. In case the organization is not able to earn the
fixed cost revenue liquidation is the best exit option for company (Mazzarol, and Reboud,
2020.)The drawback can be understood as it is an unpleasant strategy that includes the method
selling off all assets and the final closure of business operations.

Selling business to another company- This strategy means selling the business to another
company working in the same industry due to loss and not able to reach the business strategy.
The advantages of this exit strategy are company can give the business operations easily sell the
business to another company by gaining liquidity and paying off the debts. The drawbacks of this
strategy are that it involves an elaborative procedure for company to shut off all the books.
Employee buyout -This strategy means buying of company parts by the management and other
interested team members who are able to pool the financial resources to buy the management of
company. The advantage of this strategy is it protects legality and business independence (Xuan,
Thu and Anh, 2020). It implies the culture of company is maintained as the management or team
members are able to buy it. The disadvantage is that it’s not always possible for team employees
to pool the capital necessary.
CONCLUSION
This report concludes the meaning of small medium-sized enterprises, importance in the
economy and factors primarily responsible for economic growth, job creation and prosperity. The
key considerations for evaluating growth opportunities are developing the strategies for
expansion into the customer market and working on growth potentialities are explained. This
report concludes the use of Ansoff matrix by Verdant Leisure to increase the market share. It also
concludes the business plan and strategic objectives taken to upscale the business. The various
exit strategies and their implication with benefits and drawbacks for the company is explained.

REFERENCES
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