Growth Strategies and Funding Options for Business: A Report

This report focuses on growth planning for Harvey Water Softener, examining key considerations for growth options using frameworks like Porter's Five Generic Strategies. It evaluates growth opportunities using Ansoff's growth vector matrix, analyzing market penetration, product development, market development, and diversification strategies. The report also explores potential funding sources for businesses, including loans, overdrafts, and venture capital, outlining their benefits and drawbacks. Furthermore, it touches upon designing a business plan for growth and discusses exit and succession options for small businesses. The analysis emphasizes the importance of cost leadership and market development strategies for Harvey Water Softener, highlighting the need for strategic planning and financial management to achieve sustainable business growth.

Planning for growth

Table of Contents
INTRODUCTION...........................................................................................................................1
LO 1.................................................................................................................................................1
Key considerations for growth option by utilising the framework for gaining competitive
advantages ...................................................................................................................................1
Evaluate the opportunities for growth applying Ansoff's growth vector matrix ........................3
LO 2.................................................................................................................................................5
Potential source of funding available to business and its benefits and drawbacks .....................5
LO 3.................................................................................................................................................7
Design business plan for growth .................................................................................................7
LO 4...............................................................................................................................................10
Exit and succession options for small business and its benefits and drawbacks ......................10
CONCLUSION .............................................................................................................................11
REFERENCES .............................................................................................................................12

INTRODUCTION
The growth of business can be largely exciting, but it does bring modification within the
business. It is very necessary for planning for growth of business. Growth planning is strategic
business action which allow owners of business to plan and lead integrated development in this
revenue (Wu, 2015). It enables to allocate their limited resources of business towards focused to
follow the modification in the business driven by digital interruption as well as differentiate from
challengers. The methods and tactics involves planning for growth which is directed on the main
elements of generation of revenue. This study is based on the Harvey Water Softener. It is the
number one water softener. Report will explain key considerations for growth options utilising
the different framework for gaining the competitive advantages for company.
LO 1
Key considerations for growth option by utilising the framework for gaining competitive
advantages
There are various key considerations for increasing growth of business which involves
decide the company structure, secure the rights, control or have rights of intellectual rights,
shareholder agreement, incentives workers and consider the best modes to get funding for
business and so on (Keough, 2015). In this context, Harvey Water Softener needs to adopt all the
key considerations for growth of their business. Small and medium sized companies utilisation
the framework which Porter's Five Generic strategies for gaining competitive advantages and
analysing the all key considerations for growth options for business.
Porter's Five Generic Strategies:
The relative position of company within industry defines profitability which above and
below average. The key basis of above averages profits in long terms that is sustainable
competitive advantages. There are normally two kinds of competitive advantages by company
can possess like low cost and differentiation (Colantoni and et.al., 2016). These are combined
with range of actions for that company tries to accomplish them there are leading three generic
strategies for accomplishing above average presentation in the industry like cost leadership,
differentiation and focus. It involves capabilities like innovation, use of technology and process
efficiency. Resources involves like financial and human resources. Also, core competences
involves strong brand and marking skills, leadership and organization.
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Cost Leadership: The Harvey Water Softener set out to become low cost manufacturer
in the industry. The source of cost benefit are variegated and depend on the structure of the
business. They can involve patented technology, advantageous access to raw material, pursuant
of economies of scale and other elements. A low cost manufacturer can discover and effort all
the sources of costs benefits. Company can get cost advantages through some ways like
improving process ratio, gaining access to lower costs materials creating optimal outsources and
vertical combination judgement and so on (Michael Porter's Generic Strategies, 2014).
Differentiation: Company tries to be specific in their industry along some concepts
which are broadly valuable by purchasers its chose one or more dimensions which many
purchasers in business realize as essential and specific positions it self to meet those
requirements. It is rewarded for its singularity with the premium price. Companies succeed in
this strategy frequently have internal strengths like access to lead scientific research, high skilled
and innovative product development team.
Focus: The generic strategy of focus parts on the selection of tiny competitive range
within the business. The focuser choose segment or unit of segments in the business and adapt
their strategy to serve them to the rejection of other (Bridge and Dodds, 2018). There are two
variables of focus strategy such as cost focus and differentiation focus. Companies tries to cost
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Illustration 1: Michael Porter's Generic Strategies
Source: (Michael Porter's Generic Strategies, 2014)

advantage in their target segments in cost focus while organizations tries to differentiation in
their target segments in the differentiation focus. This strategy target segment top implement the
both cost leadership and differentiations concepts.
In order to that, Harvey Water Softener needs to follow cost leadership generic strategy
for growth of business. Company focus on cost leadership which includes capabilities like
innovation, use of technology and process efficiency. Resources involves like financial and
human resources. Also, core competences involves strong brand and marking skills, leadership
and organization. This kind of strategy can be very unique for companies wh0o want t6o
penetrate targeted market which is dominated through few high cost firms . Company succeed in
this strategy frequently have different internal strengths like access to the requirements of capital
which is to make important investment in manufacturing assets (Drelichowski, Olszewski and
Sikora, 2016). This investment shows barrier to entry which many companies can not decrease.
Through this strategy, ability in creating goods for cost-efficient producing and there is high
level of expertise in production process technology. There are efficient distribution channels for
selling the goods and services of Harvey Water Softener. It involves new ways of working, new
technology, increasing number of employment, migration which help to growth and development
of business in the marketplace.
The porter's generic strategy is linked with Pestle analysis which includes political, legal
environmental and economic factors which are affected on operation and strategy of business.
For example, if the inflation rate of nation is decreased, so that company will change their
marketing strategy for promoting the goods and services within marketplace. This kind of
strategy which happen challenges for company in relation to competitive advantages.
Evaluate the opportunities for growth applying Ansoff's growth vector matrix
It is the necessary to evaluate the growth opportunists of business for creating the high
position within the industry. It means entering into new markets or introducing new goods. In
this context, Harvey Water Softener use the Ansoff's growth vector matrix which is great
strategic technique for aiding determine growth strategy for their business it is likely
communally utilised technique apart from basic SWOT (Aghamirian, Dorri and Aghamirian,
2015).
Ansoff's Growth Vector Matrix:
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It is the normally called as product or market grid or matrix. It presents for options for
development through matched up existence and fresh goods with existence and fresh markets,
planned on the matrix. It aids to particular the risk which specific growth strategy can expose
business to as they move from one part to another of the matrix. This model is strategic
management technique which is associated marketing strategy with normal strategic direction
(Dereli, 2015). This theory offers four growth strategies which involves market penetration,
product development, market development and diversification.
Market Penetration:
In this strategy, company needs to provide the existence goods to existing consumer at
the extant marketplace. Through this, company requires to discover fresh modes to enhance
consumer loyalty and develop consumer life-time beliefs (Ansoff's Growth Matrix, 2013). In this
context, company develop order procedure that is making easier for consumers, extend business
hours and make accommodation which develops long terms appeal of their offering.
Market Development:
In this strategy, company wants to offer the existing goods in the new market for
targeting the new consumer segments. It is the best strategy is to attract the fresh consumers to an
existence good. Fresh market can be determine by their geographic areas which new nation. If
the core competencies are related more to particular good instead of their experience with special
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Illustration 2: Ansoff's Growth Matrix
Source: (Ansoff's Growth Matrix, 2013)

market segment, so that this market development strategy is very good concept for company
(McKenzie, 2015).
Product Development:
In this strategy, company needs to provide the new products to the existing consumer at
the existence marketplace. If the strength related to specific consumer instead of particular goods
itself, so that product development is suitable strategy for company. It can explore their strengths
by evolving new goods targeted to their existence consumers. New product development carriers
more difficult instead of easily attempting to enhance market share.
Diversification:
In this strategy, company wants to provide the new goods in the fresh market for
targeting new consumers. It is very high risky strategy for company. A better strategic
marketing advisor can aid the business to see at whether is has abilities and infrastructure to
assistance such move (McKenzie, 2015). If the business already has foundation place, excellent
supply chain, so that this strategy can work well. Other benefits of strategy is to expected gain
support in an attractive business and decrease of overall portfolio risk.
In order to that, determining all the strategies then Harvey Water Softener needs to focus
on the market penetration and market development strategies as growth opportunities of the
business. In market penetration strategy, company needs sell the water softener within the United
Kingdom. This can help to increase consumer loyalty and attention towards the goods and
services of company. In the market development strategy, Harvey Water Softener needs to sell
the water softener within the new marketplace (Brinckmann and et.al., 2015). This can aid to
target new consumers towards the existing goods within the fresh marketplace. Through both
strategies, company needs to follow new ways of working, new technology, increasing number
of employment, migration which help to growth and development of business in the marketplace.
This can id to increase the sales and profits of business in the marketplace.
LO 2
Potential source of funding available to business and its benefits and drawbacks
It is the very necessary to access the fund for growth of small-medium sized business at
the large level. In this case, there are many sources of funding available to the business which
can aid to development of business. Small companies like Harvey Water Softener frequently
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want to increase outside funding or capital in relation to explore their businesses into fresh
marketplaces or areas (Agha-Jaffar and et.al., 2016). For that, it is necessary to invest in research
and development or to make out the competitions. There are two main sources of funding
available to small business, these are debt and equity source.
Small business Loans:
If the Harvey Water Softener can get them reasonable rate which is also effective manner
to increase finance for business specially if they already generating revenue. Any loan is debt
finance and will have to be paid back.
Benefits:
 There is low interest rate which can help to go the long run.
 There is flexibility for utilising the small business loans by the small companies like
Harvey Water Softener (Golonka and Rzadca, 2017).
Drawbacks:
 A loan can association cash which can be utilised in other areas of business. Company
can attempt to obtain extra funding but that also will enhance debt responsibility.
 There is high restrictions during the course of small business loan which will follow b the
company.
Overdraft:
Business overdraft are effectively very rapid to set up and flexible business loans if the
Harvey Water Softener wants continuous loan activity to trade then they are likely the best
solution for them (Sources of funds for small businesses, 2019). This kind of funds as the rates
are normally larger than formulaic loans. Bank that provide overdraft can demand which they
pay back the full amount collected at the point.
Benefits:
 Through this way, business will need to pay interest on the money which they actually
overdraw, so that it can act as relatively low costs (Wu, 2015).
 This can aid finance range of wants of companies like Harvey Water Softener when they
do not have more money on hand, particularly if they are unexpected expenditure.
Drawbacks:
 In this source, the interest rate will be charged normally daily rate on the money which
company do draw upon.
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 Company will also pay the business overdraft fees which involve annual fees,
applications fees and late payment fees (Keough, 2015).
Venture Capital:
Venture capitalists invest among £35000-£100 million into start-up and growing
businesses with large growth expected and grip. They are professional investors who are
accountable for investing and developing some of the world's most creative companies for
example Facebook. This kind of financing is reserved for more growth technology businesses
and can be complex as with important total of money come more hands-on investors.
Benefits:
 This source can aid with mixture of judgements of business involving fiscal management
and human resource management (Drelichowski, Olszewski and Sikora, 2016).
 This source will linked in the business community.
Drawbacks:
 The cons linked with equity funding in the normal can be compounded with venture
capital funding.
 The stake of venture capital cam be more than 50% as peer the size of business.
Funds from banks:
Bank loans are also conventional source of business funding. It is normally easier to
discover and meet with with back to discuss loan. It is the determine possible venture capitalists.
Backs will needs to see detailed cash flow projections to business.
LO 3
Design business plan for growth
Each and every business wants written business plan. It is to give direction or attract the
investors, business plan wider for the success for company like Harvey Water Softener.
Effective business plan help to growth and development of small-medium sized business at the
large level (Colantoni and et.al., 2016). Business plan involves many of the elements such as:
Executive Summary:
In the business plan, it has covered the company background, market analysis,
organization and management of company. Also, it has covered that product and service, its
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marketing and sales and funding request by the Harvey Water Softener. Furthermore, plan has
covered the financial projection like income statement, revenue and other informations.
Company Background:
Harvey Water Softener is the small-medium sized company which has offered the best
quality water softener around the United Kingdom. The stating of company in the 1970 when
Harvey Bowden touched from the soft water filed in Cornwell to hard water field in the Surrey.
He stands softener which was amazed at the outcome and beginning selling them. Bowden
worked with American company to bring heavy under the sink softener to the UK market in the
1988. The strength of Harvey Water Softener is to high level experience for creating water
softener which help remove the magnesium and calcium present in the water supply. With the
innovation, it is largest opportunities for Harvey Water Softener in relation to provide the water
softener.
Mission and Vision Statement
The aim of Harvey Water Softener is to grow and develop business as per ensuring the
health and safety of people across the worldwide. The mission of company is to provide the best
facilities and goods to the people. Another objective of company is to be from hard water to soft
water by removing the magnesium and calcium present in the water supply through procedure of
ion exchange, turning is from hard water to softened water.
Market Analysis:
Market analysis is the very essential part for development and growth of the small-
medium sized business. Through this, company needs to understand the competitors, markets
and industry. In this context, Harvey Water Softener needs to determine the their industry,
challengers such as EcoWater system, Kinetico Incorporate, Marlo and others water softeners
company within the Global Market Softener Market. The strength of the company is to the
consumer loyalty and high expectation towards the water softeners. This can help to develop and
grow the business at the upper level.
Organization and Management:
Harvey Water Softener is the private and family sized company which operated by
Harvey Bowden and his family in which they provides the best quality water softener and its
services to the consumers within the marketplace. This water softener removing the magnesium
and calcium present in the water supply through procedure of ion exchange, turning is from hard
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water to softened water. It is also necessary to effective management of company in relation to
provide the best services and goods to the consumers.
Product and Service:
The scope of goods appropriate for soft water homes from the experts at the Harvey
Water Softener. Soft water bring so many advantages to consumer's home involving keeping it
clean and aiding it work more efficiently and giving the best quality water for consumers and
their families. The goods have been made by the experts by Harvey Water Softener to
compliment soft water. These involves block salt that is important for the maintenance of water
softener and soft water washing powder that is organic option to other washables solid that
contains chemicals to negate the influences of hard water. Also, consumers will purchase all
kind of goods online and get in touch if they have any queries and members of their team will be
happy to aid.
Marketing and Sales:
Marketing and sales also very essential aspects which help to growth and development of
small-medium businesses. Therefore, Harvey Water Softener needs to determine the marketing
and sales of goods and services within the marketplace. It is also identifying the market by
utilising the different strategies like targeted marketing, internet marketing like social media. In
this context, as per the current trends, company follow internet marketing strategy like social
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Illustration 3: HARVEY WATER SOFTENERS
Source: HARVEY WATER SOFTENERS