Business Growth Strategies for The Glitter Furniture Company Report

This report provides a comprehensive analysis of The Glitter Furniture Company's growth strategy, covering various aspects of business development. It begins with an executive summary and introduction, outlining the company's objectives and the scope of the analysis. The report then delves into Task 1, exploring Porter's generic strategies, PESTLE analysis, and the evaluation of growth opportunities using the Boston Consulting Group (BCG) matrix, the GE/McKinsey matrix, and the Ansoff matrix. The Ansoff matrix is used to analyze the company's products and markets. Task 2 assesses potential funding sources, including bank loans, crowdfunding, and venture capitalists. Task 3 focuses on developing a detailed business plan, while Task 4 discusses potential exit strategies. The report also examines the company's competitive advantages, the use of strategic frameworks, and the stages of product life cycles. The report is a complete analysis of the company's growth strategies, funding options, and exit strategies.

PLANNING FOR
GROWTH
1

EXECUTIVE SUMMARY
The report briefly presented the growth strategy of The Glitter Furniture Company, a
London-based furniture consulting company. Task 1 discusses about Porter's overall strategy
& growth strategy from the PESTLE analysis by The Glitter Furniture Company then there is
the evaluation of the best growth opportunities by the Boston Consulting Group parent & the
GE / McKinsey parent. Explain the brief history of these two matrices & list the main
differences between them followed by Ansoff matrix to analyze The Glitter Furniture
Company products & markets (Adyana & Hanani, 2020). This matrix examines existing &
new product markets. In order to manufacture new products, the life cycle is analyzed from
introduction to stop. What follows is a critical analysis of growth options & pathways & the
risks associated with each option & how to mitigate them. Task 2 Conduct a detailed
assessment of possible sources of funding available, such as bank loans, crowd funding, peer
loans, angel investors, & venture capitalists. The advantages & disadvantages of each method
were discussed in detail, & recommendations were made to The Glitter Furniture Company in
order to tailor appropriate funding sources for business expansion & new product
development. Next is Task 3, in which a simple, detailed & consistent business plan is
developed, which includes financial, strategic goals, & methods to achieve the goals. In Task
4, if the business performs poorly, discuss various exit strategies, such as family inheritance,
bidding, sales of business, management buyouts, franchising, & initial public offerings, &
make recommendations based on this business happenings.
2

3

INTRODUCTION
The growth of a company, whether it is small, medium or even large, is vital to the
long-term existence of the organization. SMEs are usually defined as small & medium-size
companies with fewer than two fifty workers. The European Union defines SMEs as
companies with fewer than two fifty representatives, a turnover of less than fifty million
euros, or a balance sheet of less than forty three million euros. When a business plans to
expand or develop its organisation in the national or international market, it needs to plan for
several aspects, such as resources, capital, & products (Birkin, Clarke & Clarke, 2017). The
task discussed the development strategy of The Glitter Furniture Company, an independent
furniture company based in London. The Glitter Furniture Company is looking for
commercial organizations with high-quality interior design & furniture that best fulfil their
needs of all budget sizes.
TASK 1
Analysing essential considerations for evaluating opportunities of growth & justifying these
considerations within a context of company
The expansion of an organization, whether in terms of scale or profit, is called
growth. Growth opportunities are multiple elements that any organization must consider
before formulating a growth strategy, including competitive advantages, required resources,
& impact on customers. Competitive advantage refers to the factors that enable an
organization to create products or services that are better or more profitable than competitors.
By creating bespoke products & sourcing from more than 500 furniture manufacturers, The
Glitter Furniture Company has opened up a niche market for itself. The Glitter Furniture
Company must determine a suitable growth opportunity to expand its business. In order to
determine appropriate growth opportunities, competitive advantages & growth
options/strategies (cost leadership, cost focus, differentiated focus, & differentiated
leadership) should be reviewed before making any decisions. The furniture business is geared
towards large companies & organizations & was established in 1997. Therefore, they have
the resources to finance the business. However, they can seek other financing options to gain
some reserve capital & the expansion experience of financial institutions. In addition, before
evaluating growth opportunities, they should consider whether their business is suitable for
4

expansion & whether they have the resources to finance growth. The analytical framework is
a strategic planning tool that helps assess a company's growth opportunities & make plans.
The Glitter Furniture Company long-term strategic planning can be completed through
Boston Consulting Group's Product Portfolio Matrix (BCG Matrix). The BCG matrix was
originally developed by Bruce Henderson in 1970 for the Boston Consulting Group. The
matrix examines the company's investment portfolio from two dimensions: industry growth
rate & relative market share / competitive position (Cleberg, 2019).
Cash Cow
Cash Cow is a low market growth product, but we have a relatively large market
share. The Glitter Furniture Company Cash Cow is an office table, a chair, a sofa, a dining
table, reclining & a bed & bedroom accessory (Cobetto, Aubin & Parent, 2018).
Star
Start is a product or service with high market growth. Practical fire has established a
market growth in furniture offices & hospitality sectors. However, because competition is
relatively high, we need to provide quality, unique design & competitive price environments
(De las Rivas Sanz & et. al., 2020).
Question mark
These products have high market growth, but the company has a relatively low market
share. Construction work, lighting, acoustic & ancient products have the possibility of
growth. The Glitter Furniture Company can invest more in these segments to allow growth
opportunities in the future (Deng, Ma & Zhang, 2017).
Dogs
5

These are products with low growth products & low market share, & people should be
abolished to avoid losses. The Glitter Furniture Company dogs are furniture for children,
garden accessories & accessories. Organizations can be planned to eliminate these product
lines. Thus, BCG Matrix reviews the current commercial strategy, gives the product address
for the product for the practice of furniture, or interrupting or developing. The matrix GE /
MCKINSEY is a strategic planning tool that helps organizations gives priority to investment.
The force between nine segments & the attractiveness of the market was designed by
Mckinsey & groups of consultants of the company in 1970. The GE / McKinsey matrix has
greater dimensions than BCG matrices to provide robust data measured in several dimensions
(Di Tommaso et. al., 2019).
Evaluating the opportunities for growth using Ansoff’s growth vector matrix
Organizations must continually analyse the market & assess growth opportunities to
maintain their own development in a highly competitive world. The Ansoff Growth Vector
Matrix is defined as a strategic marketing planning method used to design future growth
opportunities for the company in terms of market penetration, market development, product
development, & diversification (DODDSDIMANCHE & SADOWSKI, 2018). Listed below
are The Glitter Furniture Company’s strategic plans through product & market assessment:
Ansoff's Matrix recommends continually innovating products to capture customer
interests, improve brand trust & loyalty from existing customers, acquire new customers
through strict advertising & open up new markets in the UK & overseas. . The Ansoff matrix,
also known as the Product / Market Expansion Grid, is a tool used by companies to review &
plan their development strategies. The matrix shows four processes that can be used to enable
companies to develop & disaggregate the risks associated with each method. The advantage
of the Ansoff matrix is that in addition to suggesting potential growth strategies, it also
considers the risks & opportunity costs associated with each strategy. It is better presented to
stakeholders & provides more of a growth & development strategy for the organization
(Freire, Trigo & Friedmann, 2020).
However, some of the shortcomings of the Ansoff matrix are that it is only a theoretical
model & does not consider reality & unforeseen changes in the market. Due to the multiple
proposed growth & development options, it can also generate conflicts between stakeholders.
6

 Market Penetration: This method emphasizes the use of existing products in existing
markets & increases product coverage in existing markets by using techniques such as
increased advertising to attract new customers.
 Product development: In product development, organize design & launch new
products in today's market. This strategy is adopted when the organization has a firm
understanding of the market.
 Market development: In this strategy, the organization introduces its existing
products into new markets. Businesses can try to enter new regions, or existing
products can serve new customer groups (Gualini, 2018).
 Diversification: Adopt a diversification strategy when the company enters a new
market with new products. Although this strategy is also the riskiest, it is also the
most profitable technology.
If the company decides to adopt these strategies & methods The Glitter Furniture
Company has many products suitable for different customer groups. Therefore,
diversification is not desirable for them. They may seek market development or product
development. By introducing its existing products into new market segments & new regions,
the company can expand its scope of influence in a variety of ways. At the same time, unique
& innovative products not available to competitors will also help The Glitter Furniture
Company increase its market share in the existing market. Whenever a new product is
introduced to the market, it goes through four stages from launch to removal: introduction,
growth, maturity & decline (Hassan & Liu, 2018). These stages are listed below:
 Introduction: This is the stage when a new product is introduced to the market. The
Glitter Furniture Company can launch new products, such as new designer tables,
sofas, lighting, interior design models, & provide low entry prices to capture customer
interest.
 Growth: Once customers show interest & start buying new furniture & keep a new
catalogue for interior design, The Glitter Furniture Company can produce more new
products & designs & earn considerable profits (Hassanpour & Giti Nejad, 2020).
 Maturity: At this stage, the elements & design will be saturated. Competitors will try
to replicate the project, & The Glitter Furniture Company must insist on quality &
continuous innovation to maintain a competitive advantage.
7

 Decline: At this point, customers lose interest in the product & sales begin to decline.
At this stage, The Glitter Furniture Company can stop producing these products &
focus on other new products & innovative designs.
The Glitter Furniture Company needed to increase social media advertising & explore
new product lines for old designs & projects in new locations.
Discussing the choices for growth applying a range of analytical frameworks to show the
understanding of competitive advantage within a context of an organization
The strategic framework is an exercise model that constitutes the general strategy of
the association or department. It serves as a foundation for internal & external stakeholders,
setting priorities & activities as important drivers or pillars, as a springboard to achieve long-
term goals or objectives. A strong framework is optimistic, designed to motivate & motivate
stakeholders & shows how the association strives to achieve its vision, purpose, or objectives.
The success of an organization depends largely on the ability of the company to offer better
products than its competitors & maintain a competitive advantage in the market. Resources
are the assets of a company, which can be money, technology or labour. Competition is the
ability of an organization to use its resources to achieve excellent results. Capability is the
integration of the ability to provide customers with unique products & solutions (Hu, Huang
& Li, 2019). The Glitter Furniture Company has excellent suppliers, architects, brands &
internal service networks, which form the competitive core of organizational capabilities, &
can provide unique solutions to meet customer needs from installation to after-sales services,
thus providing advantages in competition. An organization's growth opportunity can be
determined by Porter's overall strategy, which defines competitive advantage through three
methods: cost leadership (competitive pricing), differentiation (unique products & services),
& focus (cost & cost of segments specific market).
PESTLE analysis is used to find growth opportunities by analysing macro-environmental
factors that affect the business. The specific operations are as follows:
 Political: Political factors affecting The Glitter Furniture Company are tax rates,
political stability, employment rates, national laws & legislation for business
operations, import & export regulations.
 Economy: The economic factors are inflation, currency exchange rates & economic
recession. BREXIT brings uncertainty to individuals who want to reduce costs &
other business units operating in the UK.
8

 Society: Social factors are changing fashion trends & customer preferences, cultural
behaviour, attitudes & seasonal sales. The Glitter Furniture Company has a wide
range of products & designers, who constantly update their products to meet the
interests of customers.
 Technology: Changing technological factors affect The Glitter Furniture Company
Organizations must keep up with the times & encourage employees to learn about the
latest trends (Irina, 2020).
 Law: Government policies such as labour wages, insurance, discrimination laws,
workplace safety regulations, & vacation policies are all legal factors. The Glitter
Furniture Company offers competitive salaries, health insurance & prevents
discrimination in the workplace.
 Environment: Regulations dealing with waste, pollution & availability of raw
materials are environmental factors affecting The Glitter Furniture Company (Jian,
2021).
Critical evaluation of particular options & pathways for growth, considering into account the
risks of every option & how they can be reduced
Br& trust is the key for organizations to retain existing customers, acquire new
customers, & grow in a competitive world. The Glitter Furniture Company can increase
brand trust by ensuring the quality of products & services, encouraging customer feedback,
acting responsibly & constantly innovating. The risk associated with innovation is that people
have the interest & attitude to adapt to it. According to the innovation diffusion theory,
innovation does not happen suddenly, but depends on the characteristics of people who adapt
or not (Katsarski, 2020). People are divided into five categories: innovators (people who are
interested in new ideas & adapt early), early adaptors (People who accept change), stubborn
& give comments), early public (people who will adapt after seeing evidence of innovation),
late public (only when most people adapt to new ideas & products will adapt to them), &
laggards (Conservatives & change sceptics).
9

TASK 2
Assessing the competent sources of funding available to organizations & discussing benefits
as well as disadvantages of every source
Before investing in a new business, you need to accurately assess the benefits that can
be obtained over time. The Glitter Furniture Company can assess this through the payback
period or net present value calculations. The payback period estimates the time required to
recover the initial investment in a new product or department. The calculation formula for the
payback period when the cash flow is an annuity is. The payback period = initial
expenditure/annuity payment. If the cash flow is uneven, the annual cumulative cash flow
should be calculated, for example: payback period = negative year cumulative cash flow (A)+
(absolute cumulative cash flow at the end of period A/total cash flow after period A) It is
necessary to calculate the return on investment of 2 years, 5 years or 10 years. If the
investment can be recovered within this period, The Glitter Furniture Company may consider
new projects; otherwise it will cause a loss of. The net present value will give the present
value of future cash flows, including the initial investment amount (Kinossian, 2018).
Rt is the net inflow/outflow of cash in a period, i is the discount rate, & t is the
number of periods. Consider items that show positive net present value; otherwise, they need
to be discarded. In order to expand the business, funds are needed. Different types of funds &
their advantages & disadvantages are discussed as follows: The organization is constantly
looking for sources of financing to develop its business financing, called financing, refers to
the behaviour of helping the project, the company, or the need trough’s asset contribution. It
can initiate financing for short-term or long-term purposes (Lee & Jung, 2020).
No Funds Benefits Drawbacks
1
Bank loan
Bank loan Monthly amortization of
principal & interest.
1. Fewer interest rates
2. Could maintain
control over business
1. Involves huge time
2. Needs collateral to
mitigate the risk
2
Crowd funding
Internet exchange of innovative ideas
& fundraising.
1. Could get funds fast &
easy
2. Network expansion
1. Threat of losing
br& image
2. Public display of
ideas result in
competitors copying
10

3 Peer loans
Internet risk assessment interface
level of companies & investors
1. Could acquire loans at
fewer interest rates
2. Cheap accessibility
1. No chance of
insurance or
government
protection
2. Huge credit risk
4 Angel investor
Investor Independent, if you wish
Your own ideas can invest in
companies.
1. Less risky 1. Hard to get
focus over tiny
projects
2. Loss of control
over business
5 Venture capitalists
Private equity investors who can
help new business or expansion
(Matias & Franco, 2020).
1. Valuable direction
2. Expansion opportunity
1. Long period to wait
There is a chance of
losing management
control.
6 Government start-ups
The UK government provides
funding in a variety of ways,
including grants for Innovation, 6%
1. Less risk
2. Low-interest rates
3. Tax benefits
1. Long process to
qualify for loans.
7 Start-up Loans,
Small Business Grants Small
Business Grants are different from
loans because the business does not
need to pay them back.
1. No risk 1. Less amount
2. Entire money
needs to be invested.
Evaluating competent sources of funding as well as justification for the acceptance of an
adequate source of funding for a provided business context
The expansion of digital networks has narrowed the gap between geographic
boundaries & brought more connections between people. In addition to traditional financing,
organizations can also share ideas online & easily obtain funding for new products or
business expansion. Bank loans remain a traditional way of obtaining funds for companies,
which can be repaid along with interest within a specified period. But obtaining bank loans is
very difficult, because if the authorities believe that the business does not show potential, the
bank will not assume any risk. Also, there are many regulations that must be followed & they
11

need collateral to issue loans. Crowd funding is the process of raising funds from a large
number of stakeholders by sharing new designs, products & catalogues on the Internet
(Mazzarol & Reboud, 2020).
Critical evaluation of competent sources of funding with justified argument for the
acceptance of a specific source or mix of sources, dependent on business needs
The Glitter Furniture Company can apply for funds by sharing your new product ideas
& interior design on a peer-to-peer platform to ensure your repayment ability. They can then
get funding from investors who are interested in their ideas. Once the business expands &
profits are made, the organization can begin to repay loans & interest to investors. This
approach is advantageous because The Glitter Furniture Company can raise funds directly
from investors without intermediaries. In addition, the interest rate will be much lower
compared to traditional bank loans that can be easily repaid (Moyle & et. al., 2020).
TASK 3
Designing a organizational plan for growth that comprises of financial data & strategic
targets for scaling up a company
A business plan is an official document that determines the company's goals,
establishes the company's strategic direction, & determines the methods & deadlines for
achieving the goals. The business plan must be accurate & promising so that when it is
presented to investors, they will be eager to invest in the business (Namada, 2020).
Executive Summary
The Glitter Furniture Company is an innovative design-driven furniture consulting
company that has the best supply chain & helps provide customers with the best interior
design, furniture & after-sales service. They have the best network of designers, br&s &
architects, where customers can find comprehensive solutions that suit their needs, from
installation to after-sales service. The core value & ethics of The Glitter Furniture Company
is to achieve the highest quality without affecting the customer's design wishes. The
organization provides unique & practical solutions to meet customer needs through the best
supply chain. The Glitter Furniture Company is an independent furniture organization that
provides non-professional wholesale designer furniture to the corporate world. Founded in
1997, the organization carved a foothold in the UK furniture market &, with the help of its
12