Business Growth and Financial Planning for Vectair Holdings

This report provides a comprehensive analysis of growth strategies for Vectair Holdings, a company specializing in hygiene and air-care products. It begins with an introduction to the importance of growth in a competitive market and then delves into the application of Porter's Generic Model, PESTLE analysis, and Ansoff Matrix to understand the company's market position and potential growth avenues. The report explores various funding sources, including crowdfunding, and discusses the importance of financial planning. It also examines strategic options such as market penetration, product development, and diversification. The analysis encompasses both internal and external factors influencing Vectair Holdings' growth potential, offering insights into how the company can achieve sustainable competitive advantages and maximize profitability. Finally, the report concludes with a discussion on succession or exit alternatives, providing a holistic view of business growth and strategic planning.

Planning for Growth

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1............................................................................................................................................1
P2............................................................................................................................................4
TASK 2............................................................................................................................................5
P3............................................................................................................................................5
TASK 3............................................................................................................................................8
P4............................................................................................................................................8
TASK 4............................................................................................................................................9
P5............................................................................................................................................9
CONCLUSION..............................................................................................................................11
REFERNCES.................................................................................................................................13

INTRODUCTION
Today's world is fundamentally changed due to digital network and software and also it
created intense competition or rivalry among businesses which influence over organisational
potentiality in acquiring high level of growth. Hence, it has been signified that to sustain within
competitive marketplace for long time, the concept of growth plays a crucial role in company for
attaining the same in an trenchant or expeditious manner. In addition to this, business growth is a
phase where business reaches the point for enlargement and search additive options to create
more profit in an impressive manner (Barbour and Deakin, 2012). For this study, Vectair
Holdings is considered which is one of the leading or famous technological moderniser hygiene
and air-care goods of several sectors. It is incorporated in the year of 1988 and serves to over
130 countries with a wide range of products like hand washing, skin care, sanitary disposal and
many more in a best quality. In this study, it includes implication of appropriate theories or
concepts in order to analyse existing scenario of marketplace and growth strategy, identifying
different kinds of fund sources, development of business plan. Finally, determine succession or
exit alternative for business which is also explained here.
TASK 1
P1
In the current scenario of industry, the term growth is most often used in order to enrich
productivity and profit ratio in an trenchant and economic manner. Hence, it has been evident
that growth is a precise factor for each and every establishment as it lead them to put their entire
effort towards obtaining of business goal as well as assist it offer value to its brand image. Along
with this, entailment of suitable growth strategy within a business operation or functional area
benefit them by prolonging its existence potentiality and also empower them to make decision
for tackle over all current and emerging competition in a better way (Beatley, 2014). In addition
to this, implementation of various concepts help an organisation to examine its internal and
macro environment and also help in take suitable action so that Vectair Holdings can attain
increased profit level and also improve its brand image among several rivalries in an effectual
style. Moreover, there is a high level of competition among industries which affect Vectair
Holdings productivity and its capability in acquiring large number of profits in efficient manner.
Furthermore, the industry where Vectair Holding operates is enhancing on continuous basis
1

which give company growth platforms to gain competitive benefit. Some of the models or
strategies which Vectair Holdings implies into its business function are as follows:
Porters Generic Model: This strategy is designed to gain competitive advantage within
an industry as it help an organisation to determine whether an administration profitability is
above or below the range of industrial expectation. Moreover, it aid establishment to take
advantage over competitors which can be obtained by providing customer's grater value. With
the help of such model, it assist Vectair Holdings to obtain sustainable competitive advantage in
long run (Eddleston and et. al., 2013).
Cost leadership: This aspect is mainly centring on becoming low cost producer within
marketplace. Furthermore, implementation of cost advantage strategy is wholly depend upon the
structure of marketplace which affect firm's capability in acquire sustainable profits ratio.
However, If Vecatir Holdings makes an attempt to apply the same tactics, they provide an
impressive discounts or offers for products that assist in get the attention of wide range of
customer towards their brand which offer competitive benefit to company.
Differentiation: This is known as making product unique or special, compared to other
competitor or substitute products within market. However, application of this tactics within
business operation or function enable them to achieve high level of customer satisfaction as well
as help them to gain competitive advantage in a better manner.
Cost Focus: This attribute concern with minimising costs in a focused market. Hence, in
such case, company adopts suitable techniques over product where they intend to find markets
which enable them to optimise the cost and also help them to enlarge their market size and best
position in niche sector.
Differentiation focus: This strategy is similar to cost focus, as they more centring on
being competitive in terms of quality and for attaining the same they may increases the price in
an impressive way. Therefore, if Vectair Holdings applies differentiation focus strategy, it
empower them to implement several plan of action for making delivering the product in best
quality assurance which results in acquisition of best position within competitive sector.
However, Vectair Holdings can apply differentiation focus tactics as it help them to seek
suitable opportunity to grow as well as aid them to improve their quality of goods in an unique &
creative way for obtaining competitive advantage. Along with this, it enable company to identify
the demand of products which lead them to produce best quality of item for obtaining high level
2

of customer satisfaction. Because of the emphasis over fulfilling the requirements or needs of
consumers, differentiation focus strategy help Vectair Holdings to acquire changing products
demands and expectation in a better mode as well as aid them to implement best decisions or
techniques for obtaining profit maximisation. (Porter's Generic Competitive Strategies, 2016).
PESTLE: It is the framework which is used to determine macro external factors for
acquiring best positioning in competitive industry in an innovative mode. Along with this, if an
establishment makes an effort to comply all policies of government, fulfilling customer demand,
adopting innovative technologies lead an organisation to get competitive position in marketplace.
Some of its elements are explained below:
Political: This phase signifies government plan of action, rules, regulation, political
stability and so on that has intense impact on firm's ability of decision making. However, in case
of UK government which is well known for political stability that benefit Vectair Holdings in an
amended way. Due to this reason, company can enlarge its market size and also can introduce
any modification within their business function without any hindrances in order to improve
overall performance. (Chapin, 2012).
Economical: It encompasses inflation or deflation, interest rate, economic growth,
national income level & many more which influence management's decision making capability.
In this context, Vectair Holdings contain a possibility of growth among UK marketplace, as
major portion of individuals are belongs to high income generation which aid company to
survive in UK industry for long time.
Social: In this, it comprises demographic factors like population growth, gender, income
level, customer taste and preference which effect concern potentiality in enhancing volume of
sales. Hence, for gaining competitive advantage within UK market place, Vectair Holdings
must be sensitive in delivering high quality products according to customer’s needs which assist
firm to enrich its proficiency ratio. (Ziari and et. al., 2012).
Technological: This is relates with adopting innovative techniques, novel ideas, latest
procedures which influence organisation brand value among industry. Thus, Vectair Holdings
should take an initiative in determining emerging trend of market and based on that help in
implement right action that leads company to acquire best position in UK industry within desired
period of time.
3

Legal: This phase concern with legislation, laws, rules and so on which leverage
establishment decision making capabilities. In this regard, Vecatir Holdings must ensure to
adhere towards all government legislation, laws related to employment and customers in order to
obtain best brand image among UK population in an trenchant way.
Environmental: This feature concern with preventing environment from harmful gases
and pollution which affect Vecatir Holdings productivity ratio. Henceforth, Vectair Holdings
makes an attempt to examine the positive or negative effect of environment factor over
customers as well as on business function. To provide better resolution, establishment introduce
eco-friendly products or service and also comply with all regulation related to protecting
environment that enrich Vectair Holdings profitability rate in an prompt manner.
P2
Ansoff Matrix : It is the matrix which includes growth strategies which help Vectair Holdings to
forecast potential risk in a better way for obtaining increased level of productivity. The
explanation is under following headings:
Market penetration: It is the foremost quadrant under this strategy as it states with
gaining market share by develop on its current marketplace with its current variety of products.
In case this strategy is implemented by the respective firm, it would lead to enhancement of
customer base in current market.
Product development: Under this, it signifies delivering new goods in current market as
it generate higher risk in pursuing this. Hence, to cope with industry challenges or threat, firm
identifies the trend or demand and based on that makes corrective course of action in terms of
designing new products into the market. If this strategy is executed by respective firm, it would
establish a positive image of company in the mindsets of customers as the entity takes initiative
to come up with innovative products.
Market development: This factor encompasses existing products in new markets in which
an establishment requires an effort in product planning and development in order to acquire best
position within brand new location in a better manner. In case this strategy is implemented by the
company, it results in reaching out to new customers and thereby enhancing the profits as well as
revenues of corporation in near future.
Diversification: This tactics is relates with entering into new markets with new product
which creates intense level of risk and uncertainties in accomplishing business goal or objective.
4

Hence, organisation implements best decision that results in attainment of sustainable
profitability ratio (Galland, 2012). If this strategy is applied by Vectair Holdings in its premises,
it would inflate the risk for company as hereby, the chances of success and failure are same.
Further, if this strategy is successful, it enhances the global market share and brand value of
entity.
Therefore, market development technique is viewed as suitable method for Vectair
Holdings as it enable them to enlarge its market share and enrich them to gain competitive
advantage in an innovative style. Moreover, introducing fresh product into market brings an
intense level of competition which directly impact over company's proficiency ratio. Thus, it has
been evident that launching current products into new market helps them to maintain their
profitability rate as well as can imply several techniques to enhance their productivity ratio
efficaciously and expeditious.
TASK 2
P3
To carry out an organisational goal or objective in an innovative or creative style within
desired time period, finance is regarded as essential element which help them to create an
establishment and also to manage its functional areas in a better way. In context of Vectair
Holdings, business finance is regarded as an integral component which lead them to enlarge its
market share or size as well as assist them to make use of available resource in an effectual
mode. Therefore, it has been comprehend that no organisation can exist or survive without a
sufficient amount of money in order to gain competitive advantage in a impressive or productive
manner (Ward, 2016). Hence, Vectair Holdings can make use of different sources of funds
which help them to achieve its pre determined goals in an prompt way without any obstacle.
Some of them are explained below:
Crowdfunding: This determinant states that it is a way to raise money for an organisation
by collecting donations through family, friends, customers, investors. Along with this, it is a
form of crowdsourcing and alternative finance as well as uses web based platforms or social
networking sites to solicit funds for the fundraiser by showcasing the story to potential donors or
investors. Under crowdfunding, there are several types of raising fund like reward based,
donation supported, peer to peer lending, real estate, human capital, equity that help an
5

establishment to acquire increased level of proficiency and productivity ratio in an impressive
way. Hence, some of its advantages and disadvantage are mentioned below:
Pros
 Approach to capital: One of the major benefit which crowdfunding generates is that it is
regarded as easiest and fastest mode to yield finance as it contain no advance payment.
Moreover, it allow entrepreneurs or firms to showcase their projects to a wide range of
potential investors as well as aid them to pitch the project through advanced or modern
online platform that improve company's overall productivity in a better way. Reduce financial risk: It help an establishment to increase industry substantiation and
obviate renouncing equity as it assist them to acquire niche ideas and also to predict
upcoming challenges or threat in order to obtain sustainable profitability ratio (Grover
and et. al., 2014).
Cons Under this, major drawback which an entrepreneur can face i.e. there is possibility of
leaking valuable information about products to internal or external population which may
lead organisation to turned down its proficiency level as well as impact negatively over
its brand value.
Bank Loan: It is one of the most common and effective source of finance for small and
medium size enterprises as it is a way to secure the funding between borrower and bank, and are
usually provided over a fixed period of time. In addition to this, it is also consider as most
flexible fund source because it render an option to receiver in terms of repayment of money
which is either in lump sum or in equal instalment that enhance company's productivity (Valler
and et. al., 2012). Apart from this, it can be in short or long term loan which is wholly depend
upon the purpose as well as capability of borrower in paying it back to bank without any delay.
Hence, the merits and demerits of bank loan are as follows:
Advantages
 Cost effectiveness: When it comes to interest rate, bank loan are ordinarily viewed as the
low-budget choice compare to overdraft and credit cards as it aid them to capture the
attention of large number of individuals towards their functional area and also add value
to its brand image in an impressive mode.
6

 Flexibility: The another benefit which bank loan provide is in the form of repayment of
money as it enable a borrower to pay the amount back as per their convenience as long
as the instalment are regular and timely.
Disadvantages
 Improper payment amounts: Under this method, its interest rate keeps on changes as
per the modification occurs in marketplace which imposed huge stress and burden over
each individual as well as directly effect on maintain strong financial status among
competitors. Rigorous requisite: The another negative effect which bank loan implies is that it
follows strict regulations and rules regarding payment and demands the same attitude
from borrower in order to maintain long lasting relationship between them. Additionally,
in case of failure in paying amount on desired time, it may reduces borrower's credit
percentage and future creditability (Hollenbeck and et. al., 2018).
Overdraft: This aspect take place when the business makes payments out of its current
accounts and exceeds its available balance and it is either provided over a fixed period of time or
as a rolling facility with no end date. Moreover, it is often used to ease the process of working
capital and also aid firm to back-up in order to meet unforeseen expenditures for acquiring
sustainable profitability. Some of the benefits and drawbacks are given below:
Merit
 The funding is mainly concern with giving up business share as it alleviate sum that can
be tailored to suit company necessarily, encompasses both cash flow and back up against
unexpected expenditures. There is commonly no charge for clearing overdraft earliest than awaited and thus it is
regarded as easy or agile source of arranging funds in order to accomplish desired
objective without any hindrances (Todes, 2012).
Demerit
 One of its negative effect is that its interest charge is not anticipated as it totally founded
on a variable interest rate as well as on the sum of money overdrawn on each day of
changing period. The lender may not be given the whole amount requested as the business financial
situation also taking into consideration which impact over its productivity ratio.
7

Therefore, it has been signified from this that for Vectair Holdings, bank loan is most
befitting method or source of finance that help it to make decision regarding time for repayment
of borrowed amount and also its interest rate is lesser than other sources available in market.
TASK 3
P4
Business plan is signified as the blueprint for organisation which render them proper
guidance or direction to accomplished its pre determined goal in an effective manner within
prescribed time limit (Levy, 2016). Additionally, one of its primal objective is to examine new
techniques in terms of introducing fresh products and attain increased level of sales performance.
Hence, Vectair Holdings which is UK's well known SME, seeking to enlarge its market size in
new geographical region with current products by making use of available opportunity for
growth into the market.
Vectair Holdings: It is one of the famous and reputed company which is known for
global innovators in Aircare and hygiene system and it is established in the year of 1988.
Moreover, it deliver wide range of product like skin care, odour control, hand washing etc. and
serve across the globe with high and best quality. Additionally, Vectair Holdings utilises
innovative technologies or novel ideas within its functional areas which assist them to gain
competitive advantage in an impressive or productive style.
Mission: The primal vision of Vectair Holdings is to deliver high and best quality of
products or service in order to gain customer satisfaction as well as maximise profit in an
expeditious manner (Schetke and et. al., 2012).
Vision: The foremost goal of Vectair Holding is to enlarge its market division by
introducing thier new branch into new geographical region for attaining increased level of profit
margin in a better manner.
Strategic objectives: This component is viewed as crucial for an organisation as it enable
Vectair Holdings to make best plan of action, strategies and objectives which give them better
guidance or direction for achieving pre determined goal in a desired time period. However,
Vectair Holdings is aiming for adopting more modern technology and produce innovative
products in order to increase sales performance by 15% in upcoming years.
8

Source of the investment: Under this, it is relate with arranging fund sources to achieve
business goal. Hence, there are various sources to raise funds which are bank loan, angel
investor, crowdfunding or support of financial institution for enlarging its division into new
market (Pred, 2017). However, Vectair Holding arrange their funds from bank loan that help
them to achieve its pre determined goal in an efficacious and economic way.
Action Plan: It comprises STP procedure which signifies market trend and satisfaction of
customer in a better manner. Moreover, the targeted customer for Vectair Holdings are mainly
from health conscious people who are very much sensitive for hygienic environment. Hence, in
order to attain high level of profitability, company takes an initiative to analyse the business
environment and based on that take corrective course of action in a better manner. Due to this,
they will be able to acquire best positioning within competitive marketplace in an innovative and
creative style.
Budget Planning:
PARTICULARS 6 months 6 months 6 months
Initial investment 12000 15000 18000
Borrowings(Bank loans, credits) 6000 7000 90000
Retaining earnings 7000 8000 9000
TOTAL 25000 30000 45000
MARKETING OUTLAY
Promotion activities 8000 10000 11000
Sales publicity 6000 10000 11000
Distribution and supply expenses 3000 10000 9000
TOTAL 42000 60000 76000
Marketing Plan: The marketing activities of the firm is done with the help of social
media marketing and digital marketing.
Operational Plan: The operational plan of Vectair Holdings is focussed over the growth
as well as expansion of company in new markers with a view to build large base of loyal
customers and enhance its existing level of profits.
9

TASK 4
P5
An organisation is formed with the combination of two or more personnel who come
together with an aim of achieving their pre determined goal or objective in an effective and
economical manner within prescribed time period. However, the decision regarding expanding or
exit of an establishment is totally depend upon the potentiality of company in attaining
profitability as well as industry scenario which impact its decision making capability (Lewis,
2013). However, these two components contains its own purpose and intent which differs them
from each other. Hence, in succession plan superior or owner of business desires to hand over the
entire functional area to family members or to any personnel who belongs to same management
team. Whereas, exit plan concern with those activity in which manager withdraw themselves
from all kind of business roles and responsibilities including ownership interest. Thus, there are
several types of exit or succession plan which Vectair Holdings can apply within business
operation or function and that is mentioned below:
Merger & Acquisition: In response to the obtaining increased level of growth merger and
acquisition is considered as one of the powerful determinant which enable concern to enlarge its
market share or proficiency in an efficient mode. Moreover, it is a procedure of compounding or
combining two establishments into one in which their primary content is to seek and succeed
synergy in a better way. In addition to this, merger pertain gross absorption of quarry of firm by
acquirer on the other hand acquisition indicates that the institution purchasing only part of some
other company. Some of its advantages and disadvantages are mentioned below:
Positive New Markets:With the help of merger or acquisition, it assist organisation to enlarge its
marketplace share or state of affairs into new geographic location that lead them to
acquire sustainable competing benefit as well help them to attain increased level of
productivity within industry (MacLeod, 2013). Synergy: In this, the foremost focal point is on combining two firms into one which
benefits them in various ways like enrichment in proficiency rate, enhancing productivity
and improving sales performance in an impressive or productive way.
10