Planning for Growth

This document discusses key evaluations of growth opportunities and applies the Ansoff matrix for planning growth. It also discusses various sources of funds for business growth, including bank loans, crowdfunding, angel investors, and more.

P1 Discuss key evaluations of growth
opportunities
In order to remain sustainability and
to gain competitive advancement, the
manager of Rowlinson Knitwear would
prepare an appropriate planning by
deciding an alternative course of action
which aids in meeting targets in a shorter
period of time (Chapin, 2012). For this, they
identify threats and grab each opportunity
in a best possible manner so that they could
generate greater sales which in turn
increase the overall profitability over a
marketplace. To achieve higher competition,
the manager of company would use Porter
Generic strategy which are elucidated as
follows:
Cost leadership: This strategy
encompasses the company to keep their
prices low by generating maximum profits
as it aids in gaining strong edge in a market.
The manager of Rowlinson Knitwear would
decrease the prices on merchandise so as to
enhance greater market share by creating
proper distribution of channels. This help in
gaining technical advice and also it create
the situation of price war which possess a
big threat for its rivalries.
Differentiation: This strategy would
emphasis on creating unique strategy which
involve distinct attributes that provides
greater value among their clients. The
senior authority of concerned firm would
focus on creating merchandise
differentiation and has rare and skilled
workforce which render an effective growth
and contribute more towards goals. This
generate positive reputation in an around
the world.
Focus: It is a combination of both
leadership and differentiation strategy
which is a broader term as former emphasis
on cost advantage while latter focus on rare
or differentiation which assist in gaining
customer loyalty. The managing director of
Rowlinson Knitwear would provide
offerings at a low cost by creating unique
merchandise as it wins the hearts of buyers.
It has been analyzed that the senior
authority of Rowlinson Knitwear would opt
focus strategy as an opt strategy as it would
sell merchandise at very less cost and has
highly differentiated trained staff which
create value proposition amongst its clients.
This would gain more share of market and
boost the profits of a company.
PESTLE analysis: Rowlinson
Knitwear would consider a key element that
render an effective opportunity of growth
by considering several factors into
consideration such as political, economic,
social, technological, legal and
environmental. The macro environmentalist
scans several external elements that help
firm in taking excellent decisions. With
reference to Rowlinson Knitwear, they are
more detailed as further:
Planning for Growth

Political factor: This involve several
elements such as corruption, foreign trade
law, trade restrictions and many more. UK
has greater political stability which involve
multi-party system such as conservative
and labor party (Li, Mobin and Keyser,
2016). The exit of Britain from European
Union, namely Brexit has affected the
performance of a company. This result in
declining the sales and profitability of
Rowlinson Knitwear which bring
undesirable outcomes. But at the same time,
the constant ruling party would aid the
management to follow same rules and
procedures since a long time.
Economic factor: Its constituent
elements such as monetary and fiscal
policies, GDP, inflation, per capita income,
and so on. Being the developed country, UK
has fourth ranked in terms of GDP over the
world. Although, the entry of Brexit has
created an unimaginable chaos and
adversely affect the growth of a company
(Mitchelmore and Rowley, 2013). It led to
decline in terms of productivity which affect
the sales of a company. Foreign Direct
Investment (FDI) provide an opportunity to
SMEs like Rowlinson Knitwear to generate
different source of revenue which aids in
creating a strong global presence in the
country.
Social factor: This involve several
factors such as emerging lifestyle trends,
anti-waste measures, health consciousness
and so on. The population in UK are diverse
in nature and are highly educated and which
prefer great standard of living in a
community. The senior authority of
Rowlinson Knitwear would ensure greater
quality specification by rendering great
quality of merchandise among their buyers.
As they are more concerned towards their
health and quality, so the respective firm
would provide excellent offerings so as to
generate maximum satisfaction of
customers from different parts of country.
Technological factor: These
includes various aspects such as research
and development, technical awareness and
so on. UK is most technological advanced
country so senior authority of respective
firm would use advanced technology so as
to conduct fast operations of a business in
an efficient manner. The senior authority
would also conduct research and
development by identifying the need of
competitors and their demands which boost
the sales and thus meet the expectations of
customers within a market.
Legal factor: This involve various
elements such as discrimination laws,
employment laws, trademark, patent and
copyright (Moseley, 2013). The senior
authority of Rowlinson Knitwear would
abide all policies and procedures and
maintain proper code of conduct so as to
bring greater transparency and
accountability in an efficient manner. They
also provide health and safety laws so as to
promote the interest of workers and ensure
smooth flow of activities. In addition to this,
they also protect intellectual rights and
maintain confidentiality of information
which create a harmony and systematic
working procedure of a company.
Environmental factor: These
involve elements such as climate and
weather changes, pressure from NGOs and
so on. Government has taken several
measures so as to provide protection

towards environment. By looking
awareness towards these, the manager of
respective firm strictly avoids the use of
plastic bags and make use of renewable
source of energy which ensure more
sustainability. Moreover, they also adopt the
strategy of reduce, reuse and recycle and
emphasis on minimizing carbon footprints
which in turn generates positive image of
company such as Rowlinson Knitwear.
There is growing awareness of
environmental aspects which help in
maintain a proper ecological balance.
Therefore, it has been analyzed that
PESTLE analysis provide an appropriate
framework to SMEs to increase their scale
of operation and to achieve desired level of
output. This provide assistance to firm to
combat their threats by utilizing their
strength and eliminating weakness. This
generate maximum exposure and renders
an effective growth of SMEs in a
marketplace.
P2 Apply Ansoff matrix
Ansoff matrix is a management tool
and technique which assist the firm to make
proper planning so as to analyze growth
prospects in future. This model is
propounded by Igor Ansoff in the year 1957
(Todes, 2012). They determine the risk
associated with business and understand
them so as to contribute towards a great
success in future. The manager of
Rowlinson Knitwear devises several
strategies which involve formation of
planning and organizing of work to ensure
greater degree of control which facilitate
proper coordination in a marketplace. With
reference to Rowlinson Knitwear, the four
strategies are prescribed below:
Market penetration: This strategy
focuses on rendering low cost merchandise
in the well-established market. The
manager of Rowlinson Knitwear would
emphasize on grabbing more share of
market by expanding their operations in
existing market segments. They decrease
their prices of goods or services and focus
more on promotional and marketing
campaigns which accelerate sales and find a
new way to lag behind their competitors.
Market development: This strategy
would encompass of development of new
market segments of well-developed
products in a marketplace. In relation to
this, the manager of Rowlinson Knitwear
would focus on new geographies of scale by
benefitting from economies of scale which
tends to be more successful in future. The
respective firm would plan to enter into a
foreign market which provides innovative
technology with unique features and other
resources which ensures greater growth
over a marketplace.
Development of new merchandise:
In this strategy, it encompasses of creating
new and advanced products in existing
segments of market (Wu, 2015). The senior
authority of Rowlinson Knitwear would
conduct an extensive research so that goods
are produced in a required quantity at a
proper time period. They could make
advanced new merchandise such as
traditional wear and casual clothes which
generate maximum satisfaction of clients.
Diversification: This is considered
as most risky strategy in which the firm
emphasize on developing new product and
plan to enter in a new market segment. The
manager of respective firm would
emphasize on offering new and unique

merchandise among their clients and take a
step to expand into international market in
order to boost sales. It involves two types of
risks firstly, the customer would accept new
product or not and secondly, whether
expansion plan would prove to be
advantageous for the company.
It has been analyzed that
market penetration would be a best option
for SMEs like Rowlinson Knitwear as it
generates maximum market share and
increase the sales within a market (Ziari and
et. al., 2012). It requires to invest huge sum
of funds in other strategies which become
difficult for them so market penetration
would be an excellent opportunity which
provide a strong opportunity to SMEs to
gain large exposure.
P3 Discuss various sources of funds
The role of finance manager is most
precious as they have to make optimum
utilization of funds by making proper
planning so they could modify and diversify
their operation in different parts of country.
They are regarded as the financial health of
an organization which involve obtaining of
source from different means such as
venture capital, bank loan, angel investors,
crowd funding and many more. The
manager of Rowlinson Knitwear would
obtain funds from different sources which
are prescribed below:
Bank loan: This is most effective
method in which loan is taken from bank at
a specified rate of interest in a particular
time period. The manager of Rowlinson
Knitwear would use bank loan and make
timely payment of instalments which
provide them with benefit of tax-deductible
source.
Merits: This is most secured method
as they have greater trust on it and also the
interest rate is less as compared to other
sources. Additionally, the regular
repayments would assist the firm to make
easy repaid of loan as it is most convenient
method.
Demerits: Obtaining loan from bank
require strict legal formalities which proves
to be cumbersome for the borrower. In case,
the borrower does not make timely
payment of instalments then bank has right
to seize the assets or property.
Crowdfunding: This involve the
practice of obtaining the funds from
different group of individuals with the help
of online platforms (Keough, 2015). This
aids in creating a strong distribution of
network across the worldwide by pooling
the number of investors in a marketplace.
The senior authority would raise funds
through this method as it provides a
platform to introduce their ideas which
assist in fulfilment of task in a short span of
time.
Merits: One of the greatest benefits
is that it is low risk in nature that provide a
successful idea of running the project into
well efficient manner. Also, it provides a

strong marketing campaigns and generating
a valuable image of a firm.
Demerits: This method is time
consuming and expensive source of finance.
Also, there is chances of theft of idea by
other firm due to the reason that it does not
contain copyright and patent.
Angle investors: They are
considered as a private investor who
provide a great assistance to start ups with
funds to launch their business. Angle
investors provide them funds on a one-time
basis as it fosters an innovation which thus
provides rapid economic growth. Rowlinson
Knitwear would consider this as it is less
risky and does not require any form of
collateral security.
Merits: They also provide new and
innovative ideas as they belong from
entrepreneurial background and also it
requires minimal formalities and also the
firm is not required to pay monthly
payments.
Demerits: It could lead to conflicts
and disputed if terms of negotiations are not
cleared among them. Angle investors does
not provide proper guidance which reduces
growth and as they are limited to their
ideas.
Peer to peer lending: This is a
practice of adopting funds through online
mode as the lenders has to be matched with
borrowers.
Merits: this has low rate of interest
and low fees as it is easy to apply and does
not require much formalities.
Demerits: the tax is levied on
interest rate as lot of risk is involved in it.
Venture finance: This is most
popular and emerging mode of finance
which allow start up companies to raise
funds by providing an excellent idea that
renders an excellent growth of a company.
Merits: This also help in providing
expertise knowledge and their opinions
which provide a great prosperity of success.
Demerits: there is loss of ideas as
lack of secrecy is maintained and would lead
to more and more interference of venture
capitalist which hamper the overall
business performance.
It has been evaluated that bank loan
is most appropriate for Rowlinson Knitwear
as they prove to be less burden and help in
completion of repayments in a proper time
period. Obtaining loan is easier as it
involves less rate of interest and facilitate
proper coordination.
REFERENCES
Books and Journals
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growth planning for climate protection:
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growth controls, to comprehensive
planning, to smart growth: planning's
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Mitchelmore, S. and Rowley, J., 2013.
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