Growth Strategies for New Car Deals: A Business Development Report

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Contents
INTRODUCTION........................................................................................................................2
OUTLINE OF THE COMPANY.....................................................................................................3
LO1........................................................................................................................................... 4
P1......................................................................................................................................... 4
P2......................................................................................................................................... 8
LO2......................................................................................................................................... 11
P3....................................................................................................................................... 11
LO3......................................................................................................................................... 14
P4....................................................................................................................................... 14
LO4......................................................................................................................................... 14
P5....................................................................................................................................... 14
CONCLUSION.......................................................................................................................... 14
REFERENCES........................................................................................................................... 14

INTRODUCTION
The aspect of growth is very important for every organization that ensures stability and
long-term sustainability in the market. The main purpose of this assignment is to focus on
the development of small and medium enterprise in order to achieve growth. It also
provides learning’s about the different sources of finance and positive investment
opportunities so as to attract investors (Larrain and Urzúa, 2016). The assignment also helps
to gain understanding about the potential risk and rewards involved in the growth of SME’s
It provides insight on New Car Deals that is a family owned business in Horbury. The
organization offers friendly services in a professional and friendly manner to their clients.
The long-term vision of the enterprise is to take great pride by offering the best services to
their client even after post sale of the car. The goal of the business in the next 5 years is to
expands their business by way of introducing specialized commercial vehicles and
rebranding of the pipelines for the attaining the future growth in the competitive
environment.
In today’s competitive business environment, it is essential that the small and medium
enterprise make a solid plan for achieving the growth and enhancing the market share. The
existing position in the market could be maintained by the introduction of innovative ideas
and coming up with the technology. This report provides the framework for New car deals in
order to achieve a competitive advantage by effective utilization of the resources and raising
fund from different sources (Campbell and Tawadey, 2016).

OUTLINE OF THE COMPANY
New Car Deals is a family owned business in the city of Wakefield in England that provides
effective and efficient services to their professional clients. The company aim to introduce
commercial vehicles for the future growth of the business. The company aims to provide
low cost and interactive deals to its customers through effective advertising their services
(Green, 2018). The long-term vision of the company is to raise the confidence level of the
people while booking the tickets on the phone the company also engage in renting and
leasing services at an affordable cost.

LO1
P1
Competitive advantage
Competitive advantage acts as an important basis and foundation for growth. It is important
to select a business that can help New Car Deals in order to exploit the valuable resources
and achieving distinctive competencies. Thus, New Car deals can achieve sustainable
competitive advantage in the market by exploiting valuable resources and capabilities. In
addition, the core competencies of the firm are fundamental to strategy and overall
performance of the company (Kaleka and Morgan, 2017).
 Regeneration of the valuable resources and distinctive competencies
 Adopting a Resource-based strategy
 Internal resources are the secure basis for strategy at the time of rapid changes in
the external environment
 Implementation of a firm-specific strategy to improve the profitability
Figure: Resources, Capabilities and Competitive advantage
Source: Kaleka and Morgan, 2017

Porter’s Generic Competitive strategies
New Car deals can adopt strategies given by Michael porter for the purpose of achieving a
competitive advantage in the sustainable market. This is an important strategic tool that can
help the company to provide a higher value of the products and services and thereby
improving the brand image and reputation in the target market. The generic strategy
provided by porter is Cost Leadership, differentiation and focus strategy so as to achieve the
competitive edge and increasing the profitability by reducing the costs (Tutor2U, 2018).
It is thereby recommended that New Car Dealers should adopt the cost leadership and
differentiation strategy for providing effective competitive services at reasonable prices.
This will certainly help the company to grow its market in the future.
Figure: Porter’s Generic strategy
Source: Tutor2U, 2018
BCG Matrix
This is a popular strategic tool in order to analyze the business portfolio. This matrix is
helpful in taking a decision about the different range of products sold by the business. In

addition, this matrix helps the strategic manager at New Car Deals to allocate the
investment between high growth and low growth products (Hawkey, 2017).
Figure: BCG Matrix
Source: Hartnett and Shamsuddin, 2017
New car Deals can apply this matrix for the purpose of brand marketing, analysis of the
portfolio and product management. Moreover, it helps to allocate the resource in the best
possible manner. The BCG matrix helps to analyze the different lines of the product and
provide a decision in the form of disposal or additional investment of the product line. This
is divided into 4 quadrants depending on the relative market share and relative growth rate.
The first quadrant represents the dog that further consists of the product with low growth
and low market share. The second quadrant is of question marks, which is also called as
Problem Child. These products have high market growth with relatively low market share.
The products lying in the start category are the market leaders and require ongoing

investment in order to sustain. Cash Cows products are well established with high market
share even in the low growth markets. It is hereby recommended to the business of New
Car Deals that Star product need to converted to Cash cows by additional investments in
order to generate the potential returns from the business. Furthermore, the Boston
consulting group matrix can be very helpful to the strategic manager at New Car Deals in
order to introduce the commercial vehicles in the existing product line. This will further
support business expansion plan and contribute to the growth of the company in the future.
Product life cycle
This is an important business strategy that is used by every business as all the products go
through its life cycle (Soto, 2017). it provides the sequence of changes as well as associated
with the changes in the marketing situations. This mainly includes the four phases of the
products as introduction, growth, maturity and decline. The idea of introducing commercial
vehicle into the existing product line needs to go through the different phases of PLC. At the
first stage, New Car Deals will introduce the new product, thereafter the product moving to
the growth stage and facing high competition. The third stage is of Maturity where the
demand remains constant even if there is high competition in the market. The last stage is
the Decline that records low sales and profit margins of the product. The business manager
at New Car deals needs to report on the product life cycle for the purpose of identifying the
risk and challenges in the near future.

Figure: Product Life Cycle
Source: Soto, 2017
P2
Ans Off’s Growth Matrix
The entrepreneur needs to adopt a growth strategy in order to grow their market and
achieve a competitive advantage in the industry. The growth strategy provides a greater
opportunity for the company in order to enhance the market share. The application of the
Ans off growth model can help an organization in order to seek new market opportunities
that will ultimately help in increasing the profit margins. Thus, New Car Deals needs to
analyze the feasibility of various studies (Hanlon, 2018).
Market
penetration
This strategy requires the company to penetrate the market with
the current product and thereby also help in increasing the market
share. New Car Deals need to attractive promotional strategy so as
to attract and convince the client for products and services.
Moreover, market penetration plays an important role in the
growth aspect of the business and provides the opportunity so as to
evaluate the potential market for the sale. The business strategy
focuses on cutting down the costs and enhancing the resource
capabilities in order to drive the business (Salwa and Sudarsan,
2018).
Market
development
This is another important growth strategy that enables New Car deals
to sell its existing products in the new markets. the various possible
ways so as to approach this strategy includes
 Entering into new geographical markets
 New distribution channel
 New product dimension
 Differential pricing policy so as to create a new market
segment
The organization can think about the following aspects of the
development in order to raise profitability by the introduction of

new or modified products. also, the development of the new
market needs to break down in the following phases:
- Targeting of the potential customers
- Assessment of the need
- Communication
- The building of the community
Product
Development
This growth strategy enables New Car Deals to introduce the new
product in the existing markets and further provide the need for
developing the new competencies that can appeal to the existing
markets. This strategy can help the firm in order to increase their
brand image and reputation in the existing markets.
Diversification The growth strategy of diversification requires the expansion of new
product of the business in the new market. This strategy contains the
inherent risk that requires new skills, techniques and facilities. In
addition, the existing organization should opt for this opportunity
after careful investigation of the market and attaining consistency
with the objectives & resources of the company (Salwa and Sudarsan,
2018).
There it is advisable that New Car Deals should adopt the product development strategy
that requires introducing the new product in the existing market. This growth strategy will
certainly help the firm in order to achieve a sustainable competitive advantage in the long
run. In addition, business activities can be driven by cutting down the costs and selling the
products at lower prices (Pulaj et al., 2015).

Figure: Ans off’s Growth Matrix
Source: Greve et al., 2017

LO2
P3
The aspect of finance plays a vital role in supporting the growth and expansion plan of the
organization. The introduction of commercial vehicle service by New Car deals can be a
profitable venture but requires additional funds for the smooth and effective operations of
the business activities.
The different sources of finance that can potentially support the growth strategies of New
Car Deals are as follows:
Bank Loan A bank loan is an easiest and conventional source of funding that help
in meeting the business requirements. the bank sanction the loan on
the basis of projected cash flows and net worth statement of the
individual owner of the organization (White and Moody, 2015).
Benefits
- Do not require ownership
- The fixed amount of instalments
-
Drawbacks
- Requires to maintain a substantial track record of the past years
- The high rate of interest
- Do not get enough funding for meeting the business
requirements
Angel Investors These groups of wealthy individuals provide fund for an entrepreneur in
exchange for the equity shares. Angels are in the form of an organized
group that provides funds for new ventures (Ward, 2018).
Benefits
- Provide helpful guidance to the enterprise
- Less rigidity
- Flexibility in the business agreements