Growth Strategy and Business Plan Report for HICKS HOLDING Company

This report provides a comprehensive analysis of growth planning strategies for HICKS HOLDING, a housebuilding company. It begins with an introduction to growth planning and the company's context as a small and medium enterprise (SME). The report then evaluates different growth opportunities, including a PESTLE analysis to identify political, economic, social, technological, legal, and environmental factors impacting the business. It applies Ansoff's growth vector matrix to assess market penetration, market development, product development, and diversification strategies. The report further explores various funding sources, such as bank loans, government support, and angel investors, outlining the advantages and disadvantages of each. It also includes the preparation of a business plan for company growth, covering executive summary, market analysis, and financial projections. Finally, the report addresses exit and succession options for the business, concluding with key findings and references.

Planning for Growth

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
LO 1 ................................................................................................................................................1
P 1 Evaluation of different growth opportunity to the organisation ..........................................1
P 2 Ansoff's growth vector matrix..............................................................................................3
LO 2 ................................................................................................................................................4
P 3 Different sources of funds.....................................................................................................4
LO 3.................................................................................................................................................5
P 4 Preparation of business plan for the growth of company.....................................................5
LO 4...............................................................................................................................................11
P 5 Exit and succession option for business.............................................................................11
CONCLUSION .............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
Growth planning is the strategy of the organisation to plan for the growth of the company
and increase the revenue of the company. It allows the companies to use the scare or limited
resources to provide their services and product and adapt changes like digitalisation,
differentiation etc. HICKS HOLDING company is the housebuilding company with 59
employees. It is a small and medium enterprise company ranked 23 in to 100 SME companies.
The aim of the study is to provide the detailed information regarding the various growth option
and the area in which company can gain the competitive advantage. It explains the different risk
associated with the growth option. The report also explains the different sources of funds to
improve the performance of the company. It highlights the preparation of effective business plan
for the company which includes the various financial and non financial information. It also
provides the different option of exit to the company. The aim of the study is to provide the
growth opportunity to the small and medium size enterprise with the analysis of different risk
and rewards available to the company.
LO 1
P 1 Evaluation of different growth opportunity to the organisation
HICKS HOLDING company is a house building company which build the houses and provide in
infrastructure with the latest change and trend. There are wide scope of expanding the business in
UK market. The income level and individuality of the people is high in UK which support the
growth of the business in the market. The population and the growth of the other business such
as retail sector, manufacturing sector help HICKS HOLDING company to expand the business
with the latest infrastructure. There are various growth option for the HICKS HOLDING
company such as :
PESTLE analysis to determine the growth option
Political factor : It helps the company to get the market share and the performance. The political
factor which affect the business of the company are taxation, pricing policy, wages legislation,
corruption, trade and tariff regulation etc. The pricing policy force the company to provide the
product and services in reasonable price (Niederwieser and et.al., 2016). It also controls the
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activities of the company to get the best result from their performance. Political factor also
provide support to the company to manufacture or construct the houses in the territory.
Economical factor : The economic factors of the company includes the various factors such as
interest rate, inflation rate, unemployment rate, education level, skills of the workforce, exchange
rate etc. The unemployment rate of the country help the construction industry by providing the
cheap labor in also the peak season. The decreasing interest rate in the nation helps the company
to get the funds from the investors and bank on lower interest rate and run their business properly
without any barriers.
Social factors : Social factors includes that how the company work towards the society. The
values and beliefs of the population play major role in the performance of the company. Social
factors include the culture, attitude, education level. Skills, leisure interest etc. The culture of the
nation make a huge impact on the business. It influences the business to take the major changes
in the activities to meet the customer demand and needs. The attitude and perception of customer
also affect the business (Rastogi and Trivedi, 2016). The changing attitude help construction firm
to design the houses according to the customer preferences and taste.
Technological factor : The change in technology make a huge impact on the performance of the
company both in negative and positive ways. Technology brings the various changes in
operational and marketing functions. The technological factor includes the technology diffusion
rate, impact of technology on business, impact on cost structure etc. The changing technology
help the construction firm by providing the advance equipment and techniques to perform the
activities. It also helps to improve the operational work and regulating the performance of the
company.
Legal factor : The legal framework, law, rules and regulation of the nation affect the business of
the company. The various law such as environment law, employment law, intellectual property
right law help eh company to done their business effectively and efficiently and protect the rights
of workers by providing the different facilities. It also binds the business by forcing the law and
control the activities of the company (Fozer and et.al., 2017).
Environmental factor : The changes in the environment affect the performance of the company.
It includes the weather, climate, recycling, management of resources and waste, law, regulation,
concern towards the green environment etc. The changes in the climate affect the construction
firm business like heavy rain stop the construction work for temporary basis. Before entering
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into the market construction firm has to evaluate the environment standard to run the business
successfully.
From the PESTLE analysis of the company it can be found that there are various growth
opportunity in the market to run the business successfully and help them to get the greater
earning. From the legal factor it can be analyses that the company can take the help of
intellectual property right to protect the designs of the HICKS HOLDING company which
differentiate their houses and interior to the competitors and gain the competitive advantage. The
economic factor like the interest rate help HICKS HOLDING company to gain the investment
from the market on lower rate. The technological factor also provides the various growth
opportunity by the latest equipment and techniques to improve the efficiency of the workers and
manage the performance of the worker by recording the working hour of each employees.
P 2 Ansoff's growth vector matrix
Market penetration strategy : It is the least risky strategy among all the strategy of Ansoff's
matrix. It helps the company to grow in the market by introducing the existing product in the
existing market. The promotion of product also requires less because of the already known
product in the market.
Market development : it refers to introduce the new product in the existing market. It helps the
company to grow its business because the requirement of market research is less and also it is
easy to introduce the new product with the existing market.
Product development strategy : the introduction of new product in existing market help the
company to get the new customer and competitive advantage. It provides growth in the market
because the already known customer and their taste (Yue and Peng, 2018).
Diversification : The most risky strategy of Ansoff's matrix is diversification strategy because of
the new market with mew product. It requires the huge market research to enter into the new
market and its competitors.
The product development strategy is the best strategy for the small and medium sized business
because they can introduce their new product to the existing customer. It helps the HICKS
HOLDING company to introduce their projects and new houses to the existing customer and
agents according to their taste and preferences. Product development strategy associated with the
less risk in t eh market because the buyers are known.
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LO 2
P 3 Different sources of funds
The different sources of funds help the company to expand the business and capture new
opportunity for growth and establishment of business. HICKS HOLDING company can collect
the finance from the different sources to run its business effectively and efficiently and manage
the requirement of fund for the raw material and paying wages top the workers on time. The
various sources of funds are :
Bank loan : Bank provides the loan to the SME business by charging small amount of interest
on regular basis. Banks help the company to get the money by evaluating the idea of the
enterpriser and different businesses. Bank charge monthly interest on the loan amount and deduct
the amount from the account of the account holder (Hawkey, 2017).
Advantages
Bank provide various facility and advantages to the small and medium sized enterprise. They
charge lower rate of interest to the SME and provide customized services to check and regulate
the loan premium or loan amount deduct monthly. The digitization also help the company to get
the detail of the loan amount and its premium on mail and official sites of the bank.
Disadvantage
The loan taken from bank requires the heavy documentation to confirm that the company is able
to pay the debt or not. It also a time consuming process which take huge time to sanctioning the
loan amount and pass the loan. The interest associated with the loan amount also charge on
monthly basis without considering the growth of the business that whether a company is gaining
profit in business or not. The SME loan also requires the personal guarantee to bear the debt
amount in any case of not paying the loan amount by the loan taker.
Government support : Government also provide the various benefits such as grants and
subsidies to the company (DeTienne, McKelvie and Chandler, 2015). It helps them to collect the
fund and accomplish their work to achieve the goal and objective of the organization effectively
and efficiently.
Advantages
It helps the company to get the funds to run the business. In government grants they also not
have to pay back any amount to the government. It helps to reduce the pressure from the
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shoulders of company and provide full support in running the business of the company. The
government subsidies help them to get the tax allowances, welfare payment etc.
Disadvantage
The fund from the government subsidies and grants require large documentation to regulate the
company is able to do the business or it requires the loan amount or not. It limits t he use of
money in organization. After getting the grants from the government they can only use the fund
in business activities and also they have to submit the progress and report of the company to the
government on regular basis. It requires a convincing proposal o get the grants and subsidies. It
is a long term process.
Angels : they are the person with the high experience in management and running of business.
They are the retired executive or wealthy individual with the high level of wealth. They are the
leader of their field and ready to invest in the small business to get the benefits from the profit of
the business (Advantages & Disadvantages of Government Grants, 2018).
Advantages
The fund collected from the Angels investor did not require paying the amount on monthly basis
like in the case of bank loan and credit card because they share the profit from the business. It
provides the flexibility of the business. It also helps the company to get the benefit of experience
of the investor with their investment. They did not require any monthly fees from the company.
Disadvantage
Angels did not provide any additional investment on the requirement by the business. They only
additional invest in the company if the business grow with the higher rate or earn higher income.
The investment from the angels could be costly for the company because with the investment of
the angels, company has to share their profit which could be grater than the investment amount.
LO 3
P 4 Preparation of business plan for the growth of company
Executive summary : The HICKS HOLDING company comes with the innovative
infrastructure and the customized product. They introduce their latest design in the market to
provide qualitative product to the customer. They analyse the different pricing strategy to
provide the houses according to the reach of the customer.
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Aims and objectives : The aim of the HICKS HOLDING company is to provide the qualitative
product to the customer and help them to improve the living standard. They want to provide the
houses in the best price so the customer can get the best price product.
Objectives :
 To achieve increase the sales of the company by 10% at the end of 2020.
 To provide the quality and latest design product to improve their productivity.
 To focus on the sustainability of the company and compete in the market.
PESTLE analysis
Basis High / Low Analysis
Political factor High The change in the policies and strategies by the
government affect the business of HICKS HOLDING
company (Bird, 2019). The grants and subsidies
provided by the government will help the company to
get the funds to accomplish their work.
Economical factor High The economic factor such as inflation rate and interest
rate highly affect the business of the HICKS HOLDING
company. The increasing inflation rate will reduce the
profit of the company because of the law income level of
the population.
Social factor Low The social factor less affect the business of HICKS
HOLDING company. The culture and belief of the
population wants the best qualitative product with the all
safety norms.
Technological
factor
High Technological factor includes the advance techniques
and tools in the operational and marketing work. It will
help the HICKS HOLDING company to operate the
business successfully by recording the working hours of
the workers with their performance.
Legal factor High Legal factor highly affect the business. They enforce the
various regulation and law to the company to follow
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them and report to the government. The employment law
will protect the right of HICKS HOLDING company
workers and provide them best wages on their
performance.
Environmental
factor
High They highly affect the HICKS HOLDING company. The
change in the climate will reduce their profit because in
the bad weather it is impossible to construct the building
and it also affects the quality of work.
SWOT analysis
Particulars Description
Strength  The strength of the company is that it provides the qualitative product
to the customers (Goldratt, 2017).
 The collaboration of the HICKS HOLDING company with the
interior designer and architecture help them to use the proper space
and design the house or building according the latest trend in the
market.
Weaknesses  The increasing competition in market decreases the profit of the
company and also affect the business performance.
 The change in the interest rate create the barriers in collection of funds
from the market and run the business sufficiently.
 The changing environment also reduces the profit because eit is
difficult to work in bad weather.
Opportunities  They can take the hep of government to collect the funds and operate t
eh business activity.
 The increasing migration from the other country become the big
opportunity for the company to provide their houses to the migrated
people.
Threats  The changing interest and preference of customer becomes the big
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threat for the company because it is difficult to change the
infrastructure and incurred huge investment. s
Marketing Mix
Basis Description
Product  The aim of the company is to provide the quality product to
improve the productivity and profitability.
 It also helps them to add additional features in the houses and
prepare the house with the latest interior.
Price  The premium, price help them to earn the higher profit in the
market.
 They can also charge the different price from different customer
according to their income level.
Place  They can construct the houses near the gardens and near the market
to provide the basic facilities to the customer.
Promotion  They can use both traditional and modern method to promotion to
attract the customer towards the company (Huggins and Thompson,
2015).
People  They can recruit the highly skilled agents and salesman to sell the
houses and describe the facility provided by HICKS HOLDING
company to their customer.
Procedure  HICKS HOLDING company can use the technological support and
design facility to provide best building and houses with the latest
features.
Physical evidence  The furnishing of the building help them to attract the customer and
provide the additional features,.
STP
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Segmentation : HICKS HOLDING company segment the market on the income basis of the
customer. They provide the highly equipped houses with the additional features such as
swimming pool, garden area, parking space to the high income group and the houses with the
basic facility to the lower level income group.
Targeting : The target of the HICKS HOLDING company is to provide quality product to the
customer with all basic facility. It helps them to attract the customer and differentiate the product
from the competitors (Cuervo-Cazurra, Nieto and Rodríguez, 2018).
Positioning: To position in the market they use the advance technology to attract the customer
and different promotional schemes such as use of social media, television, advertising etc.
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Financial budget :
10