Clarkslegal LLP Growth Strategy: A Business Development Report

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PLANNING FOR
GROWTH
1

Table of Contents
INTRODUCTION............................................................................................................................. 3
LO1.................................................................................................................................................3
COMPETITIVE ADVANTAGE OF CLASRKSLEGAL LLP....................................................................3
PESTEL MODEL ANALYSIS...........................................................................................................4
PORTER’S GENERIC STRATEGY MODEL.......................................................................................5
ANSOFF’S GROWTH VECTOR MATRIX........................................................................................6
LO2.................................................................................................................................................7
SOURCES OF FUNDING...............................................................................................................7
LO3.................................................................................................................................................9
A BUSINESS PLAN FOR GROWTH OF CLARKSLEGAL LLP.............................................................9
LO4............................................................................................................................................... 13
EXIT OR SUCCESSION STRATEGIES FOR CLARKSLEGAL LLP.......................................................13
RECOMMENDATIONS...............................................................................................................14
CONCLUSION............................................................................................................................... 14
REFERENCES.................................................................................................................................16
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INTRODUCTION
Each and every business is established with the motive of growth and development of the
organization (Love and Roper, 2015). Every small and medium enterprise wants to grow and
reach out to as many people as it can (Ingley et al, 2017). For this purpose, effective planning
for growth is needed. An example of Clarkslegal LLP has been taken as an example to evaluate
the strategic planning for the growth of an organization. This report will be an evaluation of
various options for growth through different analytical frameworks, which will help the
company to gain a competitive advantage over its competitors in the market. Furthermore,
various sources of funds and a systematic business plan for ClarkslegalLLP will also be framed
within this report. Lastly, an exit strategy will be evaluated, which will include various exit and
succession option for the company.
Clarkslegal LLP is a full-service commercial law firm, providing its client with legal services and
helping them to achieve their desired business outcomes. The company is based in Reading and
London and generally operates in the UK. The company has a good reputation of being
innovative, practical, commercial and strategic and also acting for a wide range of business
from startups to small-medium enterprises as well. It has been ranked under the top 100 SME
list where it stands on position 31st (Thames Valley, 2012).
LO1
As a junior manager of Clarkslegal LLP, for further growth and expansion of the company, the
report will be focusing on various frameworks and methods which could prove beneficial for
the company to gain a competitive advantage in the market. Furthermore, analysis such as
PESTEL and Porter's five forces model shall be used to understand the different aspects of
business and factors affecting them.
COMPETITIVE ADVANTAGE OF CLASRKSLEGAL LLP
The competitive advantage of a business refers to the leverage that it has on its competitors in
the market (David and David, 2016). It is offering great services and products to the customers
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at affordable prices as compared to its competitors in the market and consequently helps to
gain an advantage over its competitors. As Clarkslegal LLP is well known for its innovation,
practical, commercial and strategic approach, gaining competitive advantage will help it to
expand its business and reach to more and more number of people, Also, gaining competitive
advantage will help the company to face the challenges and risks involved in business and to
overcome these challenges easily (Siedel and Haapio, 2016). The PESTLE analysis, Ansoff’s
growth matrix and Porter’s five forces model will help to identify and evaluate those key points
on which Clarkslegal LLP should focus to gain competitive advantage and to overcome the risks
and challenges involved in the business.
PESTEL MODEL ANALYSIS
The PESEL model analysis will help Clarkslegal LLP to determine the political, legal, social,
environmental, economic and technological factors affecting the decisions of the company
(Aithal, 2016). These are the external factors of the macro environment of the company which
will help to determine risks and appropriate measure to eliminate them.
 Political Factors: As Clarkslegal is located in the UK, the political condition of the UK will
have a huge impact on the company and its decisions. Currently, the political conditions
of the UK are stable and are expected to be stable in the future as well (Ahmed et al,
2016). Furthermore, most of the policies and regulation in the UK are developed at
national, regional and local levels. The changing fiscal policies and the changing laws on
employment will also affect the decision of the company (Margaretha and Supartika,
2016).
 Economic Factors: Economic factors such as inflation, recession, unemployment, etc.
are the factors that affect a business firm economically. In the year 2007-08, the
economy of the UK suffered from a huge financial crisis and the economy of the UK has
been recovering from the (Madrid-Guijarro et al, 2016). Clarkslegal LLP would be
affected with such crisis and these economic factors such as Brexit and different laws of
different countries. However, the effects can be estimated to be less on the operation of
Clarkslegal LLP as a whole.
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 Social Factors: Social factors are those factors which comprise of the population of the
country, and also the local attitudes towards consumerism and gender roles in the
society (Cerchione et al, 2016). Changing laws also impact the needs and wants of
society. Increasing crimes and offenses in the UK also impacts the decisions of
Clarkslegal LLP.
 Technological Factors: Technology plays a major role in the decision-making of
Clarkslegal LLP. The company needs to be updated from the recent technological
revolutions and inventions which might help the company to provide its services to
people more effectively and efficiently. New technological developments would lead to
more efficiency and productivity of the employees working in the company (Palacios-
Marqués et al, 2016).
 Environmental Factors: Along with the motive to earn profit and grow, a company has
some responsibilities to possess towards society and the environment. Moreover,
Clarkslegal LLP has a corporate social responsibility to perform in order to protect the
environment as well (Loader, 2015). Thus, it is necessary that the company abide by the
environmental rules and regulations and strive towards eco-friendly business strategies
and decisions.
 Legal Factors: As Clarkslegal LLP is a firm providing legal services, it is hugely affected by
the recent laws and changes made to them. It is very essential for the company to
understand these laws and provide their services to their clients accordingly (Farrokh et
al, 2016).
PORTER’S GENERIC STRATEGY MODEL
This model will be helpful to determine the various approaches which can provide Clarkslegal
LLP a competitive advantage in the market (Parnell, 2016). The different strategies of this model
are:
 Cost leadership: Clarkslegal LLP can use this strategy to gain a competitive advantage in
the by being the lowest-cost producer in the market. This could be done by producing
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products on a large scale with less differentiation and at lower prices. This will attract
new clients and retain previous clients as well (Rao and Klien, 2015).
 Cost focus: This strategy focuses on a particular group of customers which are generally
cost oriented. With this strategy, Clarkslegal LLP can gain a competitive advantage by
targeting small and medium enterprises which are planning to grow with innovative,
practical and strategic development.
 Differentiation leadership: This strategy refers to differentiating the products and
providing unique services or products to the customers (Santos et al, 2017). This will
help Clarkslegal LLP to gain competitive advantage by increasing client engagement and
satisfaction as compared to its competitors.
 Differentiation focus: Clarkslegal LLP can adopt this strategy by targeting a specific
group of customers having a unique choice regarding products or services provided. As
the company has good overdraft facility available, Clarkslegal LLP can go for this strategy
and invest the amount as it can generate huge revenue to the company, if company
target small and medium enterprises as its customers (Evans and Price, 2017).
ANSOFF’S GROWTH VECTOR MATRIX
This model will help Clarkslegal LLP to determine and adapt various growth strategies and
approaches through which it can gain a competitive advantage in the market. These growth
strategies are:
 Market Development: It refers to explore and expand the business to new markets with
the existing products of the company. Clarkslegal LLP can explore more geographical
regions other than the UK, with its existing legal services (Meierkord, 2017).
 Market Penetration: Clarkslegal can adopt this growth strategy as well by penetrating
into the existing market with its current products or services. The main aim of the
company here would be to increase its market share. However, this strategy involves
risks but is significant for Clarkslegal LLP as it is a small law firm operating in the UK
(Bellamy et al, 2019).
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 Product Development: This strategy refers to the development of unique products into
the existing markets. This strategy can be really very helpful to Clarkslegal LLP as the
company can experiment with new developments in the technology to serve its client
more effectively and efficiently.
 Diversification: Another strategy is to diversify the business with unique products in the
new markets. This strategy can also help the company as it can deal with large
enterprises as well as providing them with their unique legal services (Zhylinska and
Stepanova, 2017).
LO2
Funding is a fuel on which a business runs. Without funding, no business can grow or survive in
the market (Burns, 2016). Funding not only maintain the cash flow within the organization, but
it also helps a business to arrange raw materials, office supplies, etc. It also contributes to the
growth and expansion of a business which consequently helps a business to develop and gain a
competitive advantage in the market.
SOURCES OF FUNDING
For the purpose of funding, a business has to explore the various sources through which it can
receive funds for its operations. The various sources of funding for Clarkslegal LLP are:
 Bank loan: Bank loan is another source from which the Clarkslegal LLP can get the funds.
This source helps the business to finance the business at nominal rates of interest and
enjoy the other services provided by the bank (Zeller, 2018). However, it lacks being
time-saving and involves a lot of documentation to be done to successfully grant a loan.
 Overdraft: As Clarkslegal LLP already have the overdraft facility of £2.0 million which it
has not utilized. An overdraft facility is for short term funding and is repayable on
demand by the bank. However, one of the major drawbacks of this source of funding is
that the interest rates are higher than the normal conventional loans and the bank may
demand the amount at any point of time (Cowling et al, 2016).
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 Crowdfunding: Another source of funding is through crowdfunding. This method
involves raising monetary contributions from a large number of the public through
different websites and sources (Lehner et al, 2015). Clarkslegal LLP can opt for this
method as well, but the disadvantage of this source of finance is that if the amount
invested does not give the desired results, the company can suffer a huge loss,
consequently leading to loss of trust of the loyal customers of the company.
 Venture Capitalists: Venture Capitalists are also one of the sources for providing
funding to the business. Clarkslegal can finance the business with this method as well.
Venture capitalists are generally those investors, who invest, finance and supports the
small business who are seeking for growth in the market but do not have access to
equities market (Teker and Teker, 2016). One of the major drawbacks of this source of
funding is that it limits the control and decision making the power of the owner and also
makes it difficult for the small companies to receive the investment.
 An Angel investor: An angel investor is an informal investor who provides capital for
business operations for the consideration of convertible debt or ownership equity
(Mason and Harrison, 2015). However, one of the major drawbacks of this source of
funding is that the owner loses his independence and control over the operations and
decision making activities of the business.
 Peer to peer lending: Peer to Peer lending is a new form of business financing. It is the
type of crowdfunding but involves a combination of both people who want to give a
loan and who want to invest (Milne and Parboteeah, 2016). Furthermore, it ensures a
regular flow of income as well. However, one of the disadvantages of peer-to-peer
lending is that it is taxable and also, unlike traditional saving, it does not comes with the
government’s guarantee. There might be some instance where P2P platform busts or
does not work. This would lead to loss of money and the money also will not be lent
straight away.
The most appropriate source of funding for Clarkslegal LLP would be the combination of the
overdraft facility and venture capitalists. As the company already has been facilitated with
the overdraft amount, it can easily access the facility. Furthermore, a company has been
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earning profits and expanding its business gradually, there are high probabilities where the
company can be financed through venture capitalists which will help the company to get
support from its investors as well (Schwienbacher et al, 2015). By receiving funds through
these methods, the company's financial needs would be fulfilled and the amount invested
by the venture capitalists and the amount as an overdraft can be repaid with the help of
earned profits by the company.
LO3
A BUSINESS PLAN FOR GROWTH OF CLARKSLEGAL LLP
Clarkslegal LLP is a law firm providing legal services to the client in the UK as well as their
international clients. The company is established in Reading and London with around clients
spread across 100 countries, with an amazing and satisfying experience with the company
(Burns and Dewhurst, 2016). The company is planning to expand and grow its business with
various product and marketing strategies. For this purpose, a business plan is needed to be
framed for the company so that it can grow and expand its business to other international
markets.
CLARKSLEGAL LLP MISSION AND VISION
The mission of the company is to maintain trust relationships with its client through innovations
and different approaches and strategies to serve its clients. The vision of the company is to
undertake multidisciplinary practice and growth their business internationally. The company’s
vision is to serve their clients and helping or assisting them either from a legal perspective or by
helping them to create right connections in order to achieve their desired business outcomes
(Clarkslegal, 2019).
OPPORTUNITY FOR GROWTH FOR CLARKSLEGAL LLP
As there is an increasing number of crimes happening around the world, Clarkslegal LLP has an
opportunity to grow its business in the legal sector in different countries. Moreover, the
company provides its services from an individual client to different small-medium enterprises
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and startups as well (Altinay et al, 2016). In the recent reports, it has been estimated that the
activity level of law will be remaining high and reflect a very active client base across a range of
industry sector (Reuters, 2018). The increasing number of startups, SME's and other offenses in
Europe, the company has favorable growth and development opportunities for Clarkslegal LLP
in the legal industry.
ETHICS OF CLARKSLEGAL LLP
Ethics plays a significant role in the development and growth of a business. As Clarkslegal LLP is
a legal firm providing its legal services, it is required that the company acts ethically so that it
does not violate someone's rights and properly undertakes its duties and obligations towards
the society. The company shall act in an ethical way so that people have trust in law and
knowledge regarding their startups or other cases (Haron et al, 2015). The company shall be
providing its services by abiding through different laws and regulations of different countries.
This will also help the company to gain a competitive advantage over other companies
providing legal services in the legal sector.
EXPECTATIONS OF STAKEHOLDERS WITH THE COMPANY
Stakeholders have a vested interest in the progress and development of the business in which
they invested. Furthermore, they are required to be updated by various changing needs of the
business and it is very necessary that clear and good communication is established with the
stakeholders (Anderson et al, 2018). Clarkslegal LLP is required to establish good and sound
relations with its stakeholders through reporting format, where a proper understanding of
business operations and transparency is maintained between the stakeholders and owners of
the company.
POTENTIAL THREATS AND PROBLEMS FACED BY THE COMPANY
The most potential threat which legal sector possess is Brexit. It has been expected that there
would be a loss of 12000 jobs and the turnover of £3 billion by 2025 (The economist, 2018).
Furthermore, Brexit will create legal and financial hurdles for the purpose of recruitment
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outside the UK. It can also lead that some of the firms only operate in the UK and cannot be
expanded further outside at international levels (Buchanan et al, 2016).
STRATEGIES FOR GROWTH AND DEVELOPMENT AND GAINING COMPETITIVE ADVANTAGE
Clarkslegal LLP can adopt certain strategies in order to grow and expand its business. These
strategies will also help the company to gain a competitive advantage over its competitors
(Blackburn, 2016). These strategies are:
 Technological developments: The Clarkslegal LLP shall make certain developments to
their technology to grow and expand their business. The company can make
developments in their technology by being accessible to their client through social
networking media, through newsletters and other platforms (Love and Roper, 2015).
The company can also partner with other companies as well in order to grow and
expand its business.
 Innovations and other techniques: As the company is known for its innovative,
commercial and strategic legal services provided by it. The company must adopt more
innovative techniques and ideas, relating to different product and growth strategies
which will consequently, help the company to expand and grow its business.
 Attracting and retaining the talents: On one hand, old talents know about the current
product and marketing strategies, while on the other hand, new talents might come
with new and innovative ideas (Rana et al, 2019). Clarkslegal LLP shall attract the new
talents by developing its marketing strategies and also, it shall make changes to its
current strategies to retain the current talents in the company. The company can also
adopt new methods of recruitment in order to retain its talents, which will also help to
attract new talents to work for the company.
ENVIRONMENTAL ANALYSIS OF CLARKSLEGAL LLP
Every business consists of those factors which surround it and influence the decisions
and strategies of the business. Clarkslegal LLP is also surrounded by such factors that
comprise its internal and external environment.
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 Internal environment: The internal environment of Clarkslegal LLP is excellent in terms
of its methods of working, its employee relations and other working facilities and
conditions. The company believes in motivating its employees and giving them the
liberty to work without pressure (Loader, 2015). Moreover, attracting and retaining the
employees through various methods of recruitment and other employee benefits such
as providing lawyers with international opportunities, providing them with stimulating
rewarding work, etc. The company also aims that all the people working at Clarkslegal
LLP challenge themselves so that they can provide high-quality services to their clients.
 External environment: The external environment is an environment in which the
business does not have any control. The external environment of Clarkslegal LLP
includes various social, political and legal factors, which affects the decisions of the
company for its growth and development (Rizos et al, 2016). The company shall keep
potential threats in mind while framing any business strategy or decision, because these
factors may lead to a long-lasting impact on the company and if not these are not
considered while planning for growth may lead to loss of market share and the amount
invested in the company.
FUNDING AND THE REASONS WHY INVESTORS SHOULD INVEST IN CLARKSLEGAL LLP
The company is an SME and for the purpose of growth, development, and expansion, the
company is needed to get finance or funding from potential investors and lenders.
However, as the company has the bank overdraft facility of £2.0 million, the company can
utilize this amount first and then seek for other sources of finance. Moreover, as Clarkslegal
LLP is a well-reputed company, there are huge probabilities for the company to attract
potential investors and lender for finance or funding.
MARKETING PLAN OF CLARKSLEGAL LLP
The marketing plan is an important function of business activities. Clarkslegal LLP is required
to develop an effective marketing plan and strategies through which it can reach out to
more customers for the purpose of growth and development of the company (Lee and
Brown, 2016). Furthermore, the company can advertise about its legal services which are
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