AZIO: Planning for Growth, Funding, and Succession Report

This report provides a comprehensive analysis of AZIO, a UK-based SME specializing in keyboard manufacturing, as it plans for expansion into the Australian market. The report begins with an introduction to planning and its importance in achieving organizational goals, followed by an assessment of growth opportunities using Porter's generic strategies (cost leadership, differentiation, cost focus, and differentiation focus) and PESTLE analysis. The report then explores the Boston Consulting Group (BCG) matrix to evaluate AZIO's product portfolio (cash cows, stars, question marks, and dogs) and uses Ansoff's growth vector matrix (market penetration, market development, product development, and diversification) to identify growth strategies. The report also examines various sources of funding, including their benefits and drawbacks, and critically evaluates potential funding sources based on organizational needs. Furthermore, it includes a business plan for growth and a succession and exit plan for the small business, outlining their advantages and disadvantages. The conclusion summarizes the key findings and recommendations, providing valuable insights for AZIO's strategic decision-making process for expansion.

Planning For Growth

INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1. Key considerations for evaluating growth opportunities.................................................1
P2. Opportunities for growth using Ansoff's growth vector matrix.......................................5
Benefits and drawbacks of collaboration, including mergers, acquisitions, joint ventures and
strategic alliances, horizontal and vertical integration and how they might be applicable
growth options for small businesses.......................................................................................6
D1 Critically evaluate specific options and pathways for growth, taking into account the risks
of each option and how they can be mitigated.......................................................................7
TASK 2............................................................................................................................................7
P3. Sources of funding with their benefits and drawbacks....................................................7
D2 Critically evaluate potential sources of funding with justified argument for the adoption of
a particular source or combination of sources, based on organisational needs......................9
TASK 3............................................................................................................................................9
P4. Business plan for growth of business...............................................................................9
TASK 4..........................................................................................................................................13
P5. Succession and exit plan for small business with its advantage and disadvantage........13
CONCLUSION..............................................................................................................................15
REFRENCES.................................................................................................................................16

INTRODUCTION
Plaining is refereed to as the process by which advance thinking is done over future
activities and actions that has to be performed for achieving goals and objectives set by an
organization. Also it helps in determining of the factors affecting profitability of business within
this strategies has been explained which helps in dealing with issues that is related to operations
taking place in an organization. AZIO is an SME that has been established in United Kingdom
and has been working over manufacturing of keyboard. They are having an turnover of
8,209,667.00. There are 58 people working in an organization. Now they are seeking over
making expansion of business in Australia by making new key boards with modern features. In
this report detail analysis of Porter generic strategy and Ansoff matrix is done in order to make
determination of growth. Also it explains about sources from which fund is being generated by
the organization with growth opportunities. Plaining is one of the most important part of
responsibility that is being managed for an organization to formulate skills and knowledge. This
makes growth to be achieved in future with success and management is required to forecast
market solutions by making an action plan within which roles and responsibility has to be
explained. The report includes growth opportunities that will help organisation to move ahead
than their rivals.
TASK 1
P1. Key considerations for evaluating growth opportunities
Planning is the idea that has been deciding and evaluating action that has to be take care
by organization for making goals and objectives to be achieved. It has been helping an
organization to bridge gap between success parameters of an organization. AZIO is small
business entity that has been established in UK and is now willing to make expansion of business
operations in Australia.
Porter's generic strategy:
Porter generic is that kind strategy that has been defining about how an organization can
use for making achievement of competitive advantage in market place. Porter's generic strategy
covers main four major strategy that is been used in order to gain competitive edge in market
place and make business expansion possible (Rudolf, Kienast and Hersperger, 2018).
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 Cost leadership: - In it strategy is been suggested firms for offering product and services
at low price in market place. This has been helping in gaining hire share in market. This
theory is being used by an organization like AZIO for capturing of larger area of market
share which reduces business operations at relatively lower cost as compare to its
competitors.
 Differentiation:- Under this strategy porter suggested that a firm can achieve higher
market share by offer the product having some unique feature which is not currently
present in the market. This strategy requires high market research as well as innovation
and ability to deliver high quality. Differentiation strategy help Newbury News Limited
in achieving competitive advantage and in attracting large number of customers.
 Cost focus:- Under this strategy organization is focused over lower market by providing
products at lowest price that is possible. Organization achieve success in segmentation
only when knowledge over marketing dynamics has been gained in proper manner. As
per the strategy AZIO attract large group of audience by selling product at low price and
gain place within market.
 Differentiation focus:- In this strategy an organization offered products to a market
holding unique features. Such strategy is required for gaining of brand loyalty within an
organization. If it is being used by AZIO then unique product is going to be produced in a
new marketplace. Helping in generating of maximum revenue for avoiding competition
in future.
Strategies mentioned above has been given by Porter that can be use by an organization for
accomplishment of competitive advantage upon its competitors. AZIO is an SME that is UK
based and deals in keyboard formations and now wants to expand business operations by making
new keyboards. Also its business operations involve online selling within the market of
Australia. The above mentioned strategies cost focus strategy is one of the most effective
strategies for AZIO to offer its products at relatively low price then its competitors. This makes
AZIO achieve large customer base in an new market with competitive advantage to be attained .
PESTLE analysis:-
As expansion of business operations within a market AZIO is required to make analysis
of various external factors that could impact expansion rate. These factors are covered under
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PESTEL analysis. This is an tool that is being used for making identification of various elements
that impacts operations within an organization like AZIO. Further the analysis is done as
follows:
 Political:- These factors include various policies that has been formed by government's
intervention within market of a country. In Australia efficiency is there within the legal
structure which has been providing lot of opportunities in order to make investment and
expansion. AZIO is impacted within the factor in a way that tax policies may impact
price of the product sold by AZIO and provides degree of uncertainty (Wey, 2019)
 Economical:- In this factors like inflation, pricing policies, foreign exchange and
economical position is being handled. Australia is having faster with strong growth rate
that is higher then UK. That is why it creates opportunities fro AZIO in order to make
expansion of business possible with higher revenue returns.
 Social:- This factor cover taste, social values and norms existing within society these
factors impacts demand of organization's product and services. Changing trends has been
taking place in Australian market which provides space to expansion. This helps AZIO in
making expansion possible of its business.
 Technological:- Technological knowledge is well embed within Australia which makes
people to be more aware about the various kind of keyboards that helps AZIO in
expansion of business. In such market AZIO can easily make its expansionism possible
as dynamic nature leads towards faster and better growth for AZIO.
 Legal:- Such factors is related all kinds of laws that is existing within society and has
been helping an organization to establish itself in legal manner and keeping all laws in
mind to avoid business practices. So, AZIO is required to follow all rules and regulations
that helps in maintaining goodwill of organization within market.
 Environmental:- These factors includes change in weather and environmental protection
& safety law. Australia has very strict and hard rules related to environmental protection
which have a great impact over the functioning of a company. AZIO is required to avoid
wastage of resources and should introduce waste management mechanism by keeping
environmental laws in mind
Boston Consultancy Group matrix: This is a plaining tool that is being uses graphical
representation of an organization's product and services within an effort for helping an
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organization in deciding over what has to be kept, sell and where investment has to be done. This
matrix is being used for making offering in four -square matrix with an y-axis representing the
rate of market growth and the x-axis representing market share. It was introduced by the Boston
Consulting Group in 1970. Also in this tool growth-share matrix aids an organization in deciding
over products, units or invest more in it. In this matrix various categories are included that dogs,
cash cow, starts and question marks. It has been further explained in relation to AZIO as follows:
CASH COWS: AZIO has been selling tow product that fall under the category of Cash
Cow and the product is wooden key board and designer’s key board. It has captured market from
a very long time. This has made organization niche over itself and has its own base. As
technology is being advanced day by day people are shifting to mobile and tablets which is
decreasing demand of keyboard. These products are of very high demand and has provided
sustainability to an organization by making it product to gain interest within an organization.
STARS: The business units that represent the star of an organization also share the
feature of having a high market share, but what makes them different from cash cows is that their
respective industry can still expand further. This can be understood that wooden keyboards is
being star product for them by increasing sales. AZIO is known for its keyboards which has
helped in developing a large base of customers and making competition to be developed within
market for an organization. Electric key board is also regarded to be star product and also holds
changes to become Cash – Cow in an organization(Yu, Yanxu and Bojie, 2019).
QUESTION MARK: AZIO also sells monitors that only make very small amount of
money to be generated but not in its true potential. There are rumours that such product has
gained more popularity then keyboards and is dominant in market. It creates a sense of lack of
trust within the employees of AZIO.
DOGS: Dogs are the products that has been perceiver over having potential in order to
make magic to be done and slows down the growth in market. Failure to deliver the expected
results makes the product a source of loss for the organization, propelling the management to
withdraw future investment in the venture. As the product has not been expecting in bringing
significant capital and further investment is seen wastage of company resources, which could be
invested in Question mark and star category instead. Electronic keyboards is considered to be
next big thing when they introduced in market but is not able to form significant offer lower
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customer demand. Electronic key is required to be advanced for making more customers to be
attracted.
P2. Opportunities for growth using Ansoff's growth vector matrix
The Ansoff's Matrix is a product/market grid through which company analyses and interpret
their approaches of growth and risk related to its products. There are four strategies given by
Ansoff which makes the firm better understands the risk associated within the market in growing
their business. This includes market penetration, product development, market development and
diversification. In context of Azio, it is important for business owners to properly analyse this
model in order to identify growth opportunities that can bring their business ahead into the
market; For this, four strategies defined under this model are needed to understand and analysed.
Here are these strategies:
The following discussion is based on Ansoff's matrix in context of Azio:
Market Penetration:
It refers to the growth of the firm related to its existing product in an existing market thereby
increasing its sales. This can be attained through number of ways like by decreasing prices and
innovating promotional activities. In context of Azio, it should apply discounts to some
customers by issuing them loyalty cards. Company should work on demand basis to attract more
customers by availing them products wherever they want. These offers leads to greater sales (Yu,
Yanxu and Bojie, 2019).
Market Development:
It is defined as the growth and risk of the company by entering in the new market with the
existing product. It is obtained by adopting new technology, analysis of disposable income of the
customers and consumer behaviour. In case of Azio, it should create the need of its services in
the new market and focus on customer's behaviour that how much they can spend on what type
of products and services. Starting in the new market, company should work on pricing and
products variations according to the customer's needs. Most importantly they require to focus on
the consumer's satisfaction to gain stability in the new market.
Product Development:
It describes introducing of a new product or service in an existing market. This is done by
mainly investing in research and development part, thinking about partnerships with other
organizations to know better about distribution channels, brand and services. Talking about Azio,
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company can manage by having a good knowledge of its existing market, analysing the needs of
the customers so that they can initiate with something new and unique. They can focus in
offering new products which was not available earlier in the market. Existing products can also
be revamp by the company so that it can be at their best. They should also work on the
consumer’s feedbacks so that they can have an idea of modification or launching new services
accordingly. After initiating the new products, it is important to create awareness by good
promotional activities. As a result, it will generate more sales and revenue.
Diversification:
It refers to grow the business by launching new product in the new market. This factor is the
riskiest amongst all the factors. Because without having any product and market experience, it is
very difficult to gain revenue initially. This takes a lot of time settling for a business in the new
market. But if this factor comes out to be advantageous for a business then the firm can gain a
good amount of revenues because it will be considered as expanded business. In context of Azio,
vertical diversification will more beneficial that means expanding the business with some good
innovating ideas in the new market.
From the above strategies, business owners of Azio can adopt market development strategy
due to demand of their existing products in new market. It helps business to gain huge customer
base as well as revenue which in results increasing possibilities of surviving in competitive
market world for longer duration.
Benefits and drawbacks of collaboration, including mergers, acquisitions, joint ventures and
strategic alliances, horizontal and vertical integration and how they might be applicable
growth options for small businesses.
It is very important for an organization like AZIO to make collaboration by using various
kinds of means like merger, acquisition, joint venture, strategic alliances with horizontal and
vertical integration. Further it has been explained as follows:
Merger: This means when two organization comes together in order to continue business. This
is done in order to help an organization sustain growth. AZIO is going to be benefitted in a
manner that being a new organization its establishment within the market will become easy
(Zhou and et. al., 2017).
Acquisitions: Is the process by which a process has to be gained over obtaining something in
this an organization takes over another organization. In this AZIO can acquire small companies
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and become large organization with variety that helps in gaining longer stability within the
market.
Joint ventures: In this AZIO and another organization comes together with then motive tom
earn profit. This enhances profit and revenue generation capability of AZIO.
Strategic alliances: AZIO is going to be benefitted in a manner that the organization coming in
alliance with it makes AZIO develops strategic skills which enhances policy formation system.
Horizontal Integration: AZIO is going to be benefitted with this in a manner that organization
is going to work over its supply chain method that ultimately helps AZIO in gaining popularity.
Vertical Integration: AZIO from this makes sure that variety of products is being produced
other than main stream product that is keyboard. This helps in increasing of customer’s base.
D1 Critically evaluate specific options and pathways for growth, taking into account the risks of
each option and how they can be mitigated.
As various strategies exists that makes an organization like AZIO to gain sustainability in
market. Over that various strategies is being used for making AZIO improvise and bring
diversity in its production which ultimately results in making it gain large customers of a
particular market.
TASK 2
P3. Sources of funding with their benefits and drawbacks
A Fund is a collection of money which is use to run any business or enterprise. There are
many source of fund namely Internal and External source.
 Internal source of fund: In this type, source is generated from owners within organisation.
Some of them are capital, retained profit and selling assets.
 External source of fund: In this funds are arranged from outside business. Some of them
are bank loans, venture capital, leasing, hire purchase and government grands.
AZIO is a company of Japan deals in electronic solutions and innovations to provide best
solution to greater China customers with innovative key devices.
Internal source of fund: when cash flows are generated from sources which are inside
organisation are internal source of fund. Some of them are under:
1. Owner's capital: In context of respective organisation owners capital is primary
source of business funds. It is beneficial to avoids dilution control and ownership
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within business. Disadvantage of this source is when owner start investing in firm
so this may lead conflicts between existing and new owners.
Retained profit: In context of AZIO it earns profit from investors or owners decide to leave some
or all money to business reinvest it in order to expand business. Advantage of this source is
implies as earnings of shareholder for reinvestment. Disadvantage of this source is every retained
is a amount of money withheld from distribution to existing shareholders (Egidi and et. al.,
2020).
Selling assets:In this type of source involves selling of products which are owned by business.
Assets that mainly use for sold are equipment, machinery and excess stock. In AZIO, company
should use its equipment’s to earn profit it reflects significant impact on business. On other hand,
when buyers are not agree to purchase obsolescence of machinery this leads to go down of
business.
External source of fund: When cash flows are generated from sources which are outside the
organisation. Some of external sources of fund new partners, trade credit, leasing and so on.
Some of them are:
1. Venture capital and business angels: In context of respective company when a person or
group which willingly wants to invest money into new or well reputed business in
exchange for an agreed share of profit. Advantage of this source it ensures constant
functioning of business. Disadvantage is when unfortunately environmental calamity is
come this leads to decrease in shares of company.
2. Bank loan: When partners of AZIO company wants money which is borrowed from a
bank by a person or business. Advantage of this source is business can get loan from low
interest rate. On other hand if organisation become solvent this leads to bankrupt for
company.
3. New partners: When competitors like ergodirect or entegra wants to enter into AZIO
business by provide capital to it or owns a share of company. This source leads to
significant for company as new partners are join and have capital too. On other hand
when a partner is well knowledgeable about company he give advice to organisation and
over rule on company.
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D2 Critically evaluate potential sources of funding with justified argument for the adoption of a
particular source or combination of sources, based on organisational needs.
AZIO for establishing itself is required to make funds from potential resources to be generated
and for this purpose only trusted sources cab be used. Funding is one of most important
resources required by an organization for making its activities processed in proper manner
(Baschat, 2018).
TASK 3
P4. Business plan for growth of business
Business plan is a written document that has been made for describing of goals and
objectives that has to be achieved with actions required to take in order to make objectives to be
achieved. In this also information related to organization is mentioned within it. It is very easy
for AZIO to make a business plan that has been including information that includes vision,
mission, strategical objective and financial data. This kind of information has been helping an
organization to perform its operation in more effective manner and bis also support organization.
in making decisions quickly and appropriately. Further business plan also help in formulating
policies and plan related to the future course of action and investment and financial decision
making. The main aim behind creating a business plan is to attract large number of investor for
investing in their business by providing them confidence that they achieve higher return over
their investment.
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