Victair Holdings: Evaluating Growth Opportunities and Funding

This report analyzes growth opportunities for Victair Holdings, a manufacturer of aircare and hygiene products. It begins by identifying key factors for evaluating growth opportunities, including political, economic, social, technological, legal, and environmental considerations. The report then explores Porter's generic growth strategies (cost leadership, differentiation, etc.) and suggests cost leadership as the most suitable strategy for Vectair Holdings. The Ansoff matrix (market penetration, market development, product development, and diversification) is used to develop strategic plans. The report then assesses various funding sources, including venture capital, banks, angel investors, and funding from friends and family, discussing the pros and cons of each. It also outlines the components of a business plan and concludes by exploring exit strategies for a small business. The report aims to provide a comprehensive overview of business growth planning and financial strategies for scaling the business.

PLANNING FOR GROWTH

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Key considerations for evaluating growth opportunities.............................................................3
Ansoff matrix:..............................................................................................................................5
Sources of funding available to business and discuss pros and cons of each source...................6
Business plan...............................................................................................................................8
Exit strategies for a business: ....................................................................................................13
CONCLUSION..............................................................................................................................15
REFERENCES................................................................................................................................1

INTRODUCTION
Planning for growth should be the priority for every business because business is started with the
aim of success and growth. Victair holdings is known for their world-class products as they
manufacture aircare and hygiene products and supply in many sectors. The company is focusing
on sanitary disposal, hand washing etc. This study will discuss growth opportunities of the
company (Pakhnenko, 2019). Further will evaluate growth opportunities by using ansoff matrix,
will access the potential source of funding available to business with pros and cons. It will also
discuss business plan for growth which include financial information and objectives for scaling
business and will discuss exit and succession options for the small business by giving benefits
and drawbacks of options.
MAIN BODY
Key considerations for evaluating growth opportunities
Before developing a new business, SMEs require identifying growth opportunities.
Without identification of growth opportunities, companies may face several problems and also
can fail in development. There are several factors that needs to be considered while developing a
new business in the market. Competition is increasing day by day because of globalization and
technological changes. So, Vectair holdings that wants to develop business by providing
hygienic products, requires identifying some factors that include:
Political: Vectair holdings provides hygienic products and now in this situation, people
require hygiene products and tools to the great extent. It is saying that happiness comes from
healthy body. Governments are also supporting such companies to the great extent. So, this
factor is beneficial and supportive for Vectair holding company.
Economic: Economic condition of the UK is not as like before. After Covid-19 lock
down, it is facing several problems (Perera, 2017). Government of the UK is providing
employment opportunities to people for improving economy. Vectair holding will also have to
strive hard but by making use of cost leadership strategy it can remain in the competition.
Social: It is other main importation factor that needs to be considered by companies that
want to expand and develop new business. In this regard it is found that people are becoming
health conscious and after Covid-19 they protect themselves. So, this factor is beneficial and
Vectair can increase its sales and take growth accordingly.

Technological: In this regard, it is found that companies in this sector are striving hard
for being in the competition. The reason behind this is technological development. It is putting
pressure on small and medium size companies to invest money in technologies. So, before
opening and developing a new business, Vectair holdings requires considering this factor. It also
requires investing in technologies for becoming successful (Marshall and et.al., 2017).
Legal: There are several rules and regulations related to health and safety. For becoming
successful and protecting against lawsuit, Vectair will require implementing all policies and
guidelines while producing hygienic products. It can help it out in improving image and
becoming successful as well.
Environmental: In the context of this factor, it is known that people prefer to buy
products from companies that maintain CSR. So, in regard of this factor, importance of
sustainability and CSR is known. By producing products, making use of natural resources to
some extent.
So, from the above discussed factors it can be said that by evaluating and considering all
these factors, Vectair can develop its internal strategies and can grow in the market.
Porter's generic growth strategy
With the help of Porter's generic, growth opportunities can be identified. Porter's generic
model can help this company out in selecting the best strategy as per the financial stability. It can
make it able in being in the competition and accomplishing goals. As per this model there are 4
strategies such as:
Cost leadership: In this strategy, company focuses on becoming the low cost producer in
this industry. This strategy is beneficial for large organizations that strives hard for being in the
competition and attracting customers. It is believed that when customers get same quality of
products at average of the market pricing or lower prices then they are more likely to become
loyal. For becoming the lowest cost producer company requires high level of productivity, high
capacity utilization and use of technology in production process.
Cost focus: It is another strategy in which company seeks a lower cost advantage in
small number of market segment. Products are as like other companies in the same industry.
Such products are acceptable to customers (Porter's Generic Competitive Strategies, 2016).
Differentiation: In this growth strategy as per this porter's generic model, business
focuses on targeting larger markets for achieving competitive advantages. In this strategy,

company needs to select one or 2 criteria in market. This differentiation strategy is all about
charging premium price and providing high values of products and services. One or 2 selected
criteria or attributes are known as uniqueness.
Differentiation focus: In this strategy, company seeks some uniqueness or differentiation
in target market. Company provide different products than its competitors by adding other
features. It is complex and risky strategy because it becomes costly to make changes in products.
For becoming successful, company requires focusing on research and knowing customers' needs.
There is requirement to fulfil at least one criterion for company if it wants to make this strategy
successful such as: It should either have consumers that have unusual needs or strong delivery
system that best serves the target market (Hales and Mclarney, 2017.).
So, on the basis of above discussed all strategies it can be said that cost leadership can
be the best for Vectair holdings company. It provides hygienic products and now in this covid-19
era, people are investing in such products. As per the increasing needs of customers, many
people are developing business in this sector so, by providing such hygienic products with better
quality at lower price, it can take growth.
Ansoff matrix:
This is one of the best tool and technique used by companies to make strategies and plans
regarding growth and expansion of business. This matrix also gives information about the
various growth strategies and its associated risks. This model will not only help the companies in
expanding its business but it will also help them in achieving their objectives in the form of
raising sales and profit shares. The strategies includes:
Market penetration:
It refers to that strategy under which companies make strategy to raise its sales
percentages and profit share. Under this strategy companies make plan regarding selling its
existing product in the existing market. This strategy is usually adopted by companies in the
form of reducing prices of the products or raising promotion strategies.
Market development:
This strategy is adopted by companies to capture new market or to explore its products in
a completely new market. Under this strategy companies have to sales its existing products in the
new market. Companies usually adopt this strategy to raise its sales not only in the existing

market but also in the new market. This can be made possible by companies in the form of
expanding business either within the same nation or outside the nation.
Product development:
It refers to launching and introducing new product into the existing market. This strategy
is helpful for the companies to cover and grab existing market completely by its products. This
can be done in the form of development of better product in comparison of the competitor's
product so that it can meet the existing need of market.
Diversification:
It refers to launching of new product in the new market. This is one of the most risky
strategy which have a direct impact over the companies brand and image. If this strategy will
succeed then it will lead to maximum benefits to company in terms of becoming market player
but if this strategy fails then company's image and profit percentages will be severely impacted.
From the above four strategies Vectair Holdings can adopt any strategy but market
development and product development would be considered as best because as it is already
dealing in hygiene products and by entering into new market or raising the variants of its
products it can achieve more success in addition to expanding its business. Apart from that it can
also opt product diversification in which it can grab more share in different market apart from
raising its product line.
Sources of funding available to business and discuss pros and cons of each source.
Sources of funding:
Sources of funding are those modes through which business take funds because funds are
necessary to run the business and in the absence of funds no business can operate.
Following are the funding options which can consider by the company:
Venture capital funding:
Venture capital funding is one of the popular funding options used by the business. Venture
capitalists are those investors who invest large sum of money in the company and take equity in
that company. VC's are said to be the professional investors who only invest in the company
which have growth in the future and can give six times returns. Victair holdings also attract
venture capitalists as they deal in hygiene products and in future the products will be on high
demand.

Benefits of VC:
The VC are able to invest large amount of money in one go and to the company they can also
provide other services like expertise or guidance which will help in further growth of company
(Poole, Fallon and Sen, 2020). If the company is funded by VC then it helps in increasing the
credibility of company. After venture capitalists has invested in the business then many partners
and future investors attracted towards the business.
Drawbacks of VC:
VC's only concern about the money, and they are not attached with the company emotionally and
timely they will see return of their investments. They also can take business in that direction
which the owner did not agree.
Banks:
Banks are the institution which provide loans to small business by taking interest on the loan, on
the basis of security banks give loan to the company which can be property papers etc. victair
holdings can take loan from banks and banks will also provide loan to the company at low
interest rates.
Benefits of Banks:
Banks offer as much amount which is needed by the company with easy payback options and
also it gives funding very fast. If company uses bank loan for funding the business then they are
not required to give equity in company unlike VC.
Drawbacks of Banks:
It is not easy to take bank loans and the criteria for taking banks loans are not fixed. Bank will
take the money in instalments despite that if business occur losses. If require long documentation
process which is complex and time-consuming. The financial options is not easy to understand, it
requires proper knowledge.
Friends and family:
As Victair holdings is the small business, so they can ask funding from their friends or relatives
because with the friends and family one have personal relations (Bellavitis and et.al., 2017).
When the business is small then money can borrowed from family because small fund is
required.
Benefits of Friends and family:

Due to close relation quick funding will get, if one add their relative in business then it makes
their relations even more strong. The pay back of the borrowed amount is also very easy.
Drawbacks of Friends and family:
Pressure to get success can hurt personal relations, sometimes can get unnecessary advice from
them.
Angel Investors:
Angel investors are those who give funds to the business in return of equity of the company.
They work in the organized group, these investors are more active than the family but less
serious as company to venture capitalists.
Benefits of Angel Investors:
They are having more experience and can give good guidance to the company in terms of
market, consumers etc. they are also called as the flexible investors.
Drawbacks:
Company is forced to give some control to them and it is very risky form of financing.
Business credit cards:
They are same as personal credit cards but the card will be in the name of company. The limit on
this card is based on the income of company (Braunholtz-Speight and et.al., 2020).
Benefits:
It is helpful in getting emergency cash and also can earn attractive perks.
Drawbacks:
It has costly cash withdrawals, have high interest rates and comes with annual fees.
Business plan
Aim:
To become one of the global player in the field of hygiene products.
Objectives:
To raise sales target at the rate of 60% by the end of 2021.
Situational analysis:
It refers to analysing the situation or business environment. Since trends and environment
is changing continuously thus it becomes more important for every company to analyse business
environment. It can be analysed in two terms:

Internal analysis:
It refers to analysing the internal environment of the company. This can be done by:
SWOT analysis:
Strength:
It refers to inner attributes of the company. It may be in the form of capability of bearing
high competition or pressure, strength in the form of high quality, perfection in meeting
customer's need and many more (Vlados, 2019). As due to Covid-19 pandemic the demand of
hygienic product got rose and meeting such high demand and pressure along with completing
orders by Victair Holdings considered as one of the biggest strength of it.
Weakness:
It refers to weak points or loops of the company which could affect its business or
activities. Weakness of the company may be in any form including lack of co-ordination, team-
spirit, poor communication and various other. However, in-spite of meeting high competition,
but making less investment in research and development along with synchronizing and meeting
demand of fast changing environment would be counted as some weakness of Victair holdings.
Opportunities:
It refers to future growth opportunities or future development opportunities. As Vectair
Holdings is dealing in such sector where there is an existing of ample amount of opportunities
(Vlados, 2019). This is because as people are getting more aware about health and hygiene
factors. Also, due to Covid many other opportunities are being developed for Vectair Holdings
which can raise its business at the next level.
Threats:
It refers to those elements which may affect company and its business. It is very essential
for companies to identify threats in advance and adopts strategies by which their impact will be
minimized. Raising competition and increasing competitors is one of the major threat that can
affect Vectair Holdings in the coming future.
External analysis:
It refers to analysing the external environment of the company. This analysis can be done by:
PESTLE analysis:
Political factors:

It includes all those factors that are associated with the country's rules and regulations. It
may affect companies in the form of changing rules and regulations, policies, political situations
and many more. Since Vectair Holdings is that company which belongs to UK and in UK, Brexit
is considered as one of the major political factor that could affect its business. As, Brexit has
imposed many restrictions regarding trade activity, hence it becomes very essential for Vectair
Holdings to study this factor before making future strategies.
Economic factor:
This factor has high intensity over Vectair Holdings. This is because any changes in the
economic policy in the form of raising rate of interest or debt or changes in economic situation
may have a severe impact over the company's business (Perera, 2017). As it is a manufacturer of
hygiene product then any change in the rate of interest of investment would directly puts an
impact over company in terms of shaking its profit terms.
Social force:
This force has very low intensity for Vectair Holdings because it is already a good
producer of hygiene products which is considered as one of the most demanded product
nowadays. Since customer's preference regarding hygiene will never going to be decline then it
would be right to said that this factor will always work in favour for the company.
Technological changes:
Changing technology or technological up-gradation has high impact over Vectair
Holdings (Marttunen, 2019). Being a technologically advanced company it becomes difficult for
it to update and upgrade its current technology as per the changes because of the involvement of
huge cost in it.
Legal force:
Changes in the regulatory provisions or rules and regulations have direct and major
impact over every company including Vectair Holdings. Thus, it becomes very essential for it to
work within legal framework.
Economic factors:
It is very important for every company to use natural resources in an efficient and
effective manner. Vectair Holdings being a supporter of sustainability concept and working
within environmental laws will not be having any major influence of this factor.
Marketing plan:

It is also a major element of business plan because without making promotion or
marketing no company can survive and sale its products to target customers. Thus, making and
execution of this plan plays an important role. Marketing plan usually includes consideration
over the following concept:
Marketing mix:
It refers to set of strategies that are used by companies to sell their product in the market. It
includes:
Product:
It refers to tangible or physical product which company is going to sell in the market. It is
being designed by companies in such a manner that it can either meet existing demand or create
new demand.
Price:
It refers to value of goods or product that company will offer to its customer. Companies
have to be very careful regarding this element which means it has to be cautious regarding
deciding prices of its products.
Place:
It refers to market or place where company is going to sell its product. This is also a
significant term because every companies wants that, they can sell their product at such place
where they will get maximum revenue.
Promotion:
Without adopting promotion practice no company would be able to create awareness
about itself and its product in the target market (Thabit and Raewf, 2018). This involves use of
advertisement, social media, and various others.
Deciding appropriate prices as per quality and value of services or products. Adopting proper
policies regarding promotion along with selling of product in the target market will help Vectair
Holdings not only in achieving objectives but it will also raise its customer's share.
Financial budget:
Expanses Estimated Costs (£)
Marketing 15000

Insurance 40000
Rent 50000
Depreciation 20000
Extra services 30000
Total 155000
Competitive analysis:
It includes analysis of competition and intensity of competition. It is very essential for
companies to analyse market competition before entering into new market or deal in competitive
market. It can be done by:
Porter's five forces model:
Buying power of suppliers:
It refers to power of supplier in the form of charging prices for raw material or number of
suppliers. Since Vectair Holdings is a seller of hygiene products and in the current time there is a
major demand of these products. Hence, intensity of this factor is low because of the availability
of number of sellers who can sell raw material to it at nominal prices.
Buying power of customers:
It refers to power of customers by which they can affect and decline prices of products of
company (Bruijl, 2018). Intensity of this force is usually high because due to quality products
Vectair Holdings usually charge price accordingly and there are many more companies other
than Vectair Holdings by whom customers can buy product at certain minimum price.
Threat of substitutes:
There is high influence of this factor within Vectair Holdings because the market in
which it dealt constitutes numerous substitutes which may affect its sales and its profit in the
long run.
Threat of new entry:
Due to existence of low entry barriers to enter into market this factor has also major
impact over Vectair Holdings because any company can enter into market and raises
competition.
Competition rivalry: