planning of growth

planning of growth

INTRODUCTION
Planning refers to the critical thinking and making appropriate decisions for several
operations that is to be performed for accomplishing organisational targets. Moreover, planning
for growth considered as an effective formulation of plans as well as strategies for the growth of
a company in near future within a competitive advantage. As small medium enterprises refer to
the small organisations who employs a small group of persons and they work for earn small
amount of revenue. The chosen organisation is Rowlinson Knitwear Ltd which manufactures
apparels and produce knitwear and school wear for the students. This was founded in 1972 in
United Kingdom which deals in apparel and textile industry. Under this report discuss about the
growth opportunities that are available and various financing options along with their advantages
and disadvantages. Along with the prepare a business plan that contains objectives, strategies,
financial plan and situational analysis. Lastly, discuss about the exit or succession strategies for a
firm with advantages and disadvantages.
TASK 1
P1:
Business for ensuring growth of the business considers various options of growth. Some
of them are given below:
Vertical growth: Vertical growth can be achieved by the businesses by taking control over the
suppliers and the distributors so that they can increase their powers.
 Advantage: This will be ensures efficient supply of the material at reduced cost as the
margin will reduce.
 Disadvantage: The opportunity of entering others reduces as it can lead to monopoly
situation.
Vertical integration: Vertical integration takes place when any organisation merges with
various supply chain partners which can be the manufacturer and retailers.
 Advantage: With this the control of supply can be taken under their control by the
companies. Also it enhances the economies of scale.
 Disadvantage: Due to increase in channel the problem of communication and
coordination can be increased which can have direct impact on the operational
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Acquisition: In acquisition both the companies operate as different entities but the acquiring
company becomes the parent company that take all the necessary actions.
 Advantage: This is advantageous for the companies as with this the organisation can
enhance their productivity as more resources will be available to them.
 Disadvantage: They may face the issue of cultural clashes due to which the achieving of
the objectives can be delayed.
For analysing the chances of growth, companies can use different range of strategies and
tool which helps in raising the market share as well as customer base. Some of these strategies
are discussed as follows:
Porter’s generic strategy: It refers to the several ways with which a firm can achieve the
competitive advantages over their competitors within an open marketplace (Hawkey, 2017). It is
related to the mainly four approaches that can be used by a firm for gaining leading positions and
moves towards the adequate growth and success. Cost leadership: It is related to the supply of better quality of products to their customers
at low prices which is affordable by all classes of people. For instance, by adopting this,
the company Rowlinson can lead high market shares and low operational as well as
production cost which will help in talking competitive advantages over their rivals
(McKenzie, 2015). Differentiation: It is related to the supply of unique as well as innovative offerings that
are not exist in the market. For example, by implementing this strategy, a company
Rowlinson can achieve their mission of facilitating durable garments and improve
customer base with the market shares. Cost focus: It is associated with the current industry and facilitates their offerings at low
prices for getting competitive edge within the market. For instance, Rowlinson can adopt
this strategy in order to attract and gain more interest of their customers by supplying
durable garments at low amount.
 Differentiation focus: It is closely associated with the unique range of their products
which is to be sold to the clients with the purpose of differentiation from their
competitors. For instance, the company Rowlinson can use this approach for getting huge
shares and high brand recognition in the mind of its customers who are loyal.
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