DEMARK: Planning for Growth - Business Report and Strategic Analysis

This report provides a comprehensive analysis of DEMARK, a small marketing firm, and its strategic planning for growth. It begins with an introduction outlining the importance of growth planning for SMEs and provides a background on DEMARK's operations. The report then delves into key considerations for evaluating growth opportunities, including competitive advantages assessed through Porter's Generic Competitive Strategies (cost leadership, differentiation leadership, cost focus, and differentiation focus) and external analysis using the PESTLE framework (political, economic, social, technological, legal, and environmental factors). Furthermore, the report applies Ansoff's growth vector matrix (market penetration, product development, market development, and product diversification) to evaluate growth opportunities for DEMARK. The assessment of potential funding sources, including personal savings and bank loans, is also included. Finally, the report designs a business plan for growth and assesses exit or succession options for DEMARK, concluding with a summary of the findings and references.

Planning For Growth

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Key considerations for evaluating growth opportunities.......................................................1
P2 Apply Ansoff's growth vector matrix to evaluate growth opportunities................................4
TASK 2............................................................................................................................................5
P3 Assess potential sources of funding available to business ....................................................5
TASK 3............................................................................................................................................7
P4 Design business plan for growth............................................................................................7
TASK 4............................................................................................................................................9
P5 Assess exit or succession options for a small business..........................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Planning for growth is a strategic activity which is essential for organisation to enlarge
business and its market. Small and medium firms have large number of opportunities that are to
increase market reach and customer base. For this, manager formulate plan to direct employees
and make them execute operations in systematically (Barbour and Deakin, 2012). Present report
is based on DEMARK which is a small firm that provide marketing support to other companies.
Firm is making bid of £80,000 in government contract i.e. “Alcohol social marketing campaign”.
This assignment specifies key considerations and Ansoff's growth matrix that are used by
businessperson to examine growth opportunities. Different potential sources are assessed by
entrepreneur to have adequate capital for executing business activities effectively. Further
succession and exit options are acknowledged by them to make decisions for growth of business.
TASK 1
P1 Key considerations for evaluating growth opportunities
Small and medium enterprises have numerous opportunities to enhance their market to
improve their sales and profitability. For this, an entrepreneur conduct market survey to have
information about different growth chances. Along this, the firms even find out competitor's
offering to provide products and services accordingly. This help them to establish competitive
advantage in respect to rival firms. DEMARK is a small scale firm which provide marketing
services to other companies to promote their products and services to people.
Competitive advantages: Each and every sector includes large number of firms which are
conducting business. This is requisite for organisation to understand their resources, skills and
competitive edge which can be assessed through porter's generic competitive strategy. This can
refer to as model i.e. used by entrepreneur of DEMARK to construct advantage (Beatley, 2014).
Porter's Generic Competitive Strategies: This concept was developed by Professor
Michael Porter. It is a framework which define that management of DEMARK to frame
strategies according to market. Thus, these are four tactics which an entrepreneur uses to asses
competitive advantage of company which are mentioned beneath:
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(Source: Porter's Generic Competitive Strategies, 2018)
Cost leadership: This is an efficient strategy which is adopted by firms to maintain their
prices by lowering costs and attain edge over competitors. Businessperson require to lower down
expenses to provide products and services at appropriate rates to grab attention of large number
of people. For this, entrepreneur of DEMARK uses advanced technologies which help them to
provide marketing services at reasonable rates.(Chen and et. al., 2014).
Differentiation leadership: It is another strategy which is used by top personnel to
manufacture products and services different from rival firms. This helps management of
DEMARK to position company higher than other enterprises. Product's features and attributes
are differentiated to give choice to people to purchase it according to their requirements and
needs.
Cost focus: This is strategy which is adopted by firms to conduct business in certain
niche market. Management adopt advanced technologies to reduce production cost, thereby
provide items and services at reasonable prices. This help entrepreneur of DEMARK to provide
marketing services at appropriate rates in respect to rival firms (Eddleston and et. al., 2013).
Differentiation focus: It is another strategy which is used by companies which are
operating in niche market. DEMARK provides marketing services to other firms for which
entrepreneur have skilled and competent people. This help them to create an attractive and
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Illustration 1: Porter's Generic Competitive Strategies

efficient websites to promote information to public about their products and services. Thus,
employees are able to make customers loyal towards firm.
Thus, from the above strategies entrepreneur, DEMARK can employ cost leadership
strategy. This tactic is adopted by top personnel to use advanced technologies that are social
media and online platform to market information to public about other firm. It is a small firm, so
it is difficult for business person to increase outlets in different nations. Along this, for
differentiation manager require talented and competent staff members. Thus, cost leadership
strategy helps top personnel to attract large number of customers with help of online platform
that is social media (Galland, 2012).
External Analysis: Entrepreneur even require to have information about market
conditions to design system accordingly. PESTLE analysis is an appropriate technique which is
used by entrepreneur to have information about growth opportunities in market. This can help
DEMARK to make suitable decisions to prosper in respect to government, economic conditions,
public, technology which is described below: Political factor: This component define rules and laws which are formulated by
government to regulate functioning of organisation. It is necessary for DEMARK to
register firm and take licensing from authorities to make system function legally. Along
this, they even require to formulate policies in respect to regulatory bodies. United
Kingdom, government had made liberal policies for small firms. This benefit
entrepreneur of DEMARK to conduct business properly. Besides this, government of
other countries also promote SME's which increases opportunity for company to set up
outlet in different nation easily. Economic factor: This element includes interest rate, inflation, exchange rate, growth
which depend on functioning of country. These are different components which affect on
organisation's funds availability and profitability. In UK market, there is inflation and
growth situation which benefit DEMARK to have adequate number of customers to
enhance sales and revenue. Companies have good amount of funds which management is
ready to invest in marketing. Thus, entrepreneur of DEMARK have appropriate client
organisation which require them to promotion of items and services to public (Levy,
2016).
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 Social factor: This component define that organisation provide products and services to
fulfil demands and needs of people. DEMARK conduct marketing for other firms to
support and promote information to public about their services. This can benefit
management of other companies to save their time of managing online websites.
Entrepreneur of DEMARK uses online platform to promote information to public about
firm. Customers number and interest towards social media has increased which aid top
personnel to increase clients easily. Technological factor: It is another element which help small and medium firms to utilise
resources in efficient manner. Entrepreneur of DEMARK uses advanced software and
technologies to create and manage online websites of their client firms. This benefits
them to use online platform that is social media to increase market reach and customer
base. Legal factor: This is component which comprises act which are formulated by
government for safety and security of rights of employees. It is essential that business
person of DEMARK provide positive working environment to staff members. Along this,
they even provide fair treatment and work to subordinates in according to their abilities.
This benefit entrepreneur to retain competent people for longer time which have skills to
work with advanced technologies properly (MacLeod, 2013).
 Environmental factor: This element define that management require to implement
appropriate tools in system for utilisation of natural resources properly. This benefit small
and medium firms to utilise resources properly and conduct business in ethical manner.
DEMARK uses advanced technologies and software which can help organisation in
preventing usage of paper. Company had constructed online websites for other firms to
promote their products and services in market.
P2 Apply Ansoff's growth vector matrix to evaluate growth opportunities
Business person of small and medium firm examine business and its operations to
conduct it in according to market conditions. DEMARK is small marketing and promotion
company which provide marketing services to other enterprises. In order to identify expand and
prosper their business, the organisation carried out Ansoff Growth Vector Matrix. This help them
to make changes in system, that is implement advances software and technologies. Thus,
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company create and regulate attractive online website to promote information to public about
products and services of client firm (Moseley, 2013).
Ansoff's growth vector matrix: This model was propounded by H. Ignor Ansoff. It is a
popular framework which includes strategies that business person can use to make growth. It is
essential that present market conditions are examined by entrepreneur to make changes in system
accordingly. New product and market in which business enlarge to enhance their sales and
profitability. Thus, these are four components of this matrix which are described below:
 Market penetration: This is one of strategic choice which is used by firms to promote
items and services to their existing buyers. For this, management reposition brand to
attract customers to purchase products again. In context of DEMARK, entrepreneur
require to create and sustain their position and image in market. For this, they maintain
relations with clients and randomly contact with them to sustain them for longer time
(Schetke, Haase and Kötter, 2012).
Illustration1: Ansoff Matrix
(Source: The Ansoff Model, 2013) Product development: It is another strategy which define about changes in items and
services which are made by top personnel in respect to demands and needs of people.
Innovative and creative products are developed by management in respect to
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requirements of public. In context of DEMARK, firm can make modification in software
and technologies to provide creative and unique marketing services to other firm. This
help company to frame an effective online website for client organisation. Market development: This strategy is often adopted by firms to increase their market
reach to enhance their customer base. For this, existing products and services are
promoted to a new market (Todes, 2012). This help management to increase their sales
volume and profitability. In context of DEMARK, it is a small firm which have outlet in
United Kingdom. But, through online tool entrepreneur has created clients in other
places. For this, company uses this tactic to expand outlet in other locations to provide
services to clients easily.
 Product diversification: It is another strategy which is used by management to offer new
items and services to people. there are two forms of diversification that are either in same
product line or another one. This helps executive to sell different variety of products and
services in respect of demands and requirements of public. DEMARK provide marketing
services to other firms that is manage online websites and promote information to public
about products and services. For this, entrepreneur adopt this tactic to make improvement
in software and technologies to create an attractive online websites. Besides this, firm
increases business with help of social platform which help manager to manage customers
easily.
Thus, from the above strategies market development is appropriate for DEMARK which
help entrepreneur to increase market reach and customer base. With aid of digital technologies
that is mobile and social media which benefit them to enhance sales volume and profitability.
TASK 2
P3 Assess potential sources of funding available to business
Every organisation is required to raise their financial position in order to grow their
business(Valler, Phelps and Wood, 2012). In context to DEMARK, company need to generate
funds from different sources in according to its suitability of business. There are various sources
of funding which are available for small business to which help them in implementing their
strategies. These are evaluated as below:
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Personal saving: It is the personal amount of businessman which can be used by him in
business anytime. It is fastest mode of funding as documentation is not required in this. Along
with this, owner of DEMARK does not need to involve any external person in decision making
process.
 Advantage: Personal saving is beneficial for this organisation as whole control of
business is owned by the owner only. Disadvantage: Major drawback of personal saving is that it misses valuable advise of
other investors which can be beneficial for DEMARK. In addition to this, if in any case
business suffers from loss then whole invested amount of owner will going to be wasted.
Bank loans: Bank provides various types of loans to the small businesses according to
their requirement. In this, bank provides various payment options to the organisations such as
payment in instalment. It is required by manager of DEMARK to analyse interest rate of all the
bank in order to chose most nominal one among them (van Assche, Lo and Beunen, 2013).
 Advantage: Bank loan offers various options to the businessman which help them in
finalising best one on the basis of their needs. It is safe and secure mode of raising fund
as the bank doesn't use the security for their personal purpose. Disadvantage: This source includes lots of documentation which consumes time of
businessman as well as bank. Along with this, if returning instalments are not paid on the
given time period then bank may own the security in form of property.
Friends and families: Financial funds of small business can be raised by friends as well
as families. Value of raised amount depends on the relationship with the family members and
friends (Ward, 2016).
 Advantage: It is considered as the fastest process of funding with various type of payment
methods. Under this, rate of interest is nominal which provides maximum monetary
benefit to the business. This does not requires any legal documentation which saves time
of businessman.
 Disadvantage: Amount raised from friends and family might impact negatively on mutual
relationships between them. As if amount is not returned on the given time with decided
interest rate then it may affect their relations.
Manager have various options of funding which are personal saving, friends and families
and bank loan. Entrepreneur of DEMARK is using bank loan as this is most suitable method of
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funding for organisation through which organisation can invest large amount of their
organisation to prosper accordingly. They are making bid of £80,000, in which they have
£20,000 and remaining £60,000 they will take from bank.
TASK 3
P4 Design business plan for growth
Business plan is a written document i.e. constructed by an entrepreneur to inform
stakeholders of firm about their company. Description of enterprise, mission and vision,
objectives, products and services, financial information and internal analysis are various
elements which are included in this document. This help executive to direct staff members to
conduct business operations in defined manner. Along with this, they are also able to make
changes in system for making growth with time (Wu, 2015).
Business plan of DEMARK:
Company Description: DEMARK is small firm which has headquarter in Beverley, East
Yorkshire United Kingdom. Firm provide marketing and promotion services to other
organisation. For this, entrepreneur require to have skilled and talented staff members which
create and maintain effective and attractive website for their clients. Currently, firm is making
bid in a government contract that is “Alcohol Social Marketing Campaign”. Aim of this
programme is to formulate and deliver a social marketing campaign about effects of alcohol on
health of people. For this, authorities have conducted a research which help them to have
evidences. Thus, this campaign is conducted to inform public. Value of contract is £100,000 in
which company is bidding value is £80,000. But, as entrepreneur have only £20,000 and
remaining they will be taking from other funding sources.
Mission and Vision: DEMARK mission is to frame an attractive and efficient website
for other firms to promote and market products and services to public. Besides this, vision of
DEMARK is to have increase market reach to have large customer base and sales.
Strategic objectives: Entrepreneur of DEMARK has formulated SMART objectives
which are stated below (Goodfellow, 2013):
Objectives:
 Use advanced software and technologies to construct an efficient website and marketing
platform for client firms within 6 month.
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 Execute government contract to create appropriate image and goodwill in market.
 Increase revenue by 20% in next 2 years .
Products and services: DEMARK provide marketing services to other firms that is to
create and manage their online websites and advertisements.
Internal analysis: DEMARK uses SWOT analysis to have information about strengths
and weaknesses of system. This help them to utilise market opportunities and protect firm from
rival firms (Lewis, 2013).
SWOT analysis of DEMARK
 Strengths: In DEMARK, there are highly skilled and talented team that are major
strength of organisation. On the other hand, adopting updated technology and online
platform that is social media benefits company to establish competitive advantage. Weaknesses: As a new marketing agency, company needs to break their marketing
segment in different areas. Thus, it might take time to company to build up reputation in
United Kingdom's market. Management require competent staff members and if firm
doesn't have than this affect on quality of marketing services. Opportunities: As DEMARK have massive market to expand in different targeted areas.
Thus, this can be considered as high level of opportunity in order to expand their business
or to enter a whole new market (Shi and et. al., 2012). Threats: Economic downturn or rise competition are two major threats for DEMARK.
On the other hand, decrease in economy may affect purchasing or spending capacity of
consumers. Thus, this can also be taken as a threat for entrepreneur of this company.
Formulation of budget:
Particulars Jan Feb Mar Apr June Total
Cash
Inflow
Investment 6000 6000
Credit Sales 2000 2200 3500 3000 2000 12700
Total
Inflow 8000 2200 3500 3000 2000 18700
Cash
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