Ovation Systems: Business Growth Planning and Funding Report

This report examines the growth strategies for Ovation Systems Limited, a company specializing in electronic products. It begins with an introduction to planning and its importance in achieving organizational goals. The report then analyzes growth opportunities using PESTLE and Porter's Five Forces models, identifying strategies like cost leadership, differentiation, and focus. It also utilizes Ansoff's matrix to assess market penetration, product development, market development, and diversification strategies. Furthermore, the report evaluates potential funding sources, including bank loans and family/friends, along with their advantages and disadvantages. Finally, it addresses business plan design for growth and exit or succession options for small businesses, providing a comprehensive overview of strategies for business expansion and financial planning.

Planning for Growth

Table of Contents
INTRODUCTION...........................................................................................................................3
PART 1............................................................................................................................................3
P1 Analyse the out the growth opportunities in the context of organisation.............................3
P2 Identify the opportunities for business growth by using Ansoff's matrix..............................6
TASK 2............................................................................................................................................7
P3 Assess potential sources of funding available for organization.............................................7
P4 Design a business plan for growth........................................................................................9
TASK 4..........................................................................................................................................12
P5 Assess exit or succession options for small businesses.......................................................12
CONCLUSION.........................................................................................................................13

INTRODUCTION
Planning is the process of thinking about various activities which is required to gain
organisational objectives. In other words it a method which involves the creation and
maintenances of plan and execution to achieve desired goal (Brinckmann, 2019.). Planning
facilitate manager to distributes funds as per the requirement to fulfil the demand of customers.
Planning is thinking before the action take place and it involve the rational thinking and logical
decision making. In this current report Ovation system limited is taken as consideration which
deals in electronic product such as digital video recording, micro cameras and video & audio
delay. Ovation Systems specialize in the design and manufacture of rugged, high performance
video surveillance products for police, military and government law enforcement agencies
worldwide. Its head office is located in Springfield barn, London Road, UK. The current report
covers key elements for growth opportunities in the context of company. Ansoff model is also
used to figure out the success and growth rate. Further it analysis the potential sources of funding
available for business expansion and their drawback. At last it covers business plan for growth
and also include financial information and strategies for scaling up a business.
PART 1
P1 Analyse the out the growth opportunities in the context of organisation
In this competitive world, company have to offer best quality of product and services to
their outcomes. With the help of this strategy company can grab more opportunities present in
market. For the company like Ovation system have various skilled and potential employees to
perform the activities in well defined manner. Organisation hold the major market share in
electronic to avail quality services to respective buyers (Aganbegyan, 2019). It has become
important for business to obtain the best strategies and also to gather the information from the
customers to make changes as per the requirement. Organisation must analysis the market
scenario to seek new business opportunities to understand the actual needs of end consumers. For
this project PESTLE analysis and Porters five forces model and used to improve the employees
performance.
Porter’s Generic Strategies:

It is a method through which company engage in competition advantages to overcome the
problems. It current market position describe the firm position whether it can survive for long
run or not. Mainly there are two type of competition advantages for business venture which are
low cost or differentiation. A organization can choose different strategies which is best suitable
to gain competitive advantages. Hence it include different strategies which are elaborated down
below:
Cost leadership:
Cost leadership is a strategy companies use to increase efficiencies and reduce production
costs below the industry average or their closest competitor. The modern business environment is
complex and sophisticated to understand the changing demands of customers. In the context of
ovation system limited manager can take various steps to minimize the extras cost which
occurred while production. This leadership techniques will facilitate the organisation to make
larger customers base and expand business in effectively manner.
Differentiation:
It occurs in large company where different departments or branch offices create their own
corporate culture within the company (Holz-Rau,and Scheiner, 2019). For Ovation company it
can use diversified product range to gain more market share as well as consumers. A highly
diversified product range for a company help to provide vast opportunities to capture the
untapped marketplace. Ovation system must decide if it wants to differentiate based on tasks or
product offerings. Several companies may prefer to divide into sectors that produce only one
product and have functioning marketing strategies to gain profit for long run.
Focus:
Companies which more often use focus strategies have emphasis on niche market.
Company understand the market scenario and unique demand of customers and develop the low
cost and specific product for the new market. This will tend to build strong brand loyalty among
the customers. In the case of Ovation system limited managers and top management focus on
planning and make effective strategies in order to capture large market share.
As per the above the mentioned report it has cleared that leadership style will help
Ovation system limited to capture the huge market and more profit. With the help of focus
strategies firm can reach the larger audience and explore new audience for business.
PESTLE Analysis:

A PESTEL analysis is a tool to figure out the macro-environmental factor which may
have major impact on organization performance. This tool is effective when company are
launching new product in the market. It also help in understanding different situation which are
related to external and internal factor for organization. In regard of Ovation system it is
important for manager to implement this model to identify the different trends and opportunities
available in industry. PESTEL have explained in brief down below:
Political: This factor is all about the level of government intervention in a business and
also in economy. Political factor can be of different kind such as political stability or instability,
corruption, foreign trade policy, tax policy, labour law, environmental law and trade restrictions.
For the company like ovation system, manager must check political environment and track the
changes so that company may not get effected by political condition. All factors that need to be
taken into account when assessing the attractiveness of a potential market. For the country like
UK the government is stable so company can generate huge profit as there is government support
to the companies.ss
Economical factors: It is related to the economic performance which include economic
growth, exchange rates, inflation rates, interest rates, disposable income of consumers and
unemployment rates. This kind of factor may be related to direct or indirect impact on the
customers. It will be beneficial for Ovation system to gain more market share in UK and at
international level. Economical factor may also effect the purchasing power and f customers and
can improve the demand and supply structure in company.
Social Factor : It is a factor which refers to demographic location, customs and value of
individual in organization. Social factor include population growth, age, income, career, health
consciousness, lifestyle attitudes, cultural barriers and safety. It facilitate the Ovation system to
analyses the new market and potential customers in order to expand business. This factor is
important for company to analyses the consumer attributes which can help ovation system to
make changes according the customer moods.
` Technological factor: In today's modern world technological changes impact on the
market as well as on product. It affects when company launches new product and services. It
refers to invention, automation, research and development activities. In this case ovation system
limited can take use of advance technology to expand business operation and it also help in
managing operations overseas.

Environmental Factor: It has become important nowadays to take care of environment
in best possible way. It has become crucial for organization take proper measure due to scarcity
of raw material, and other resources which limited in nature. For Ovation system limited
company must take effective measure such as minimal the pollution, reduce wastage by using
them carefully. Company must move towards carbon neutral in order to respect environment.
This strategies will create goodwill in the minds of customers and it will help organization to
expand their market. These environmental factor help in business to grow in best possible way so
and help in expansion of business entity.
Legal factor: This factor include health and safety, equal opportunities to every
employees who are working for the same company. It is should clear that that what is legal or
illegal for a organization in order to run smooth operation. For Ovation system company must
follow all the rules and regulation. Firm should keep in mind that each country have their own
set of rules and organization must follow those laws for proper functioning in long run.
P2 Identify the opportunities for business growth by using Ansoff's matrix
Ansoff's matrix is a tool which is used by firms to analyze the plan and their strategies for
growth. The matrix shows marketers as well as leaders understand the risk of growing in the
business. For the company like ovation system limited this matrix will help in strategies in best
possible way and also provide insight of business expansion. Ansoff matrix help to figure out the
risk factor and causes while growing or diversifying their product. There are four aspect through
which company can execute the model in well defined manner.
Market penetration: In a market penetration strategy, the firm uses its product in the
existing market. It is done with the objective of increasing the market share and to expand
customer base. For ovation system limited it will help in identifying the price to attract more and
more customers. It is important for organization to enhance promotional activities and
distribution efforts. Market penetration help in acquiring the competitors in business
environment so gain more market share and larger customer base.
Product development: In product development strategies, firm launch new product in
order to cater existing market. In the case of ovation system marketing team should focus on
developing the new product as to meet changing demand of customers. Product development
typically involve extensive research and development for expansion of product range. Company
can understand the current trends so to make changes as per the customers needs and wants.

Company can indulge in strategic partnership with other firms to gain access to larger
distribution channel which help company to make more profits in coming future.
Market development: In market development process firm enter a new market with the
existing product. For Ovation system company get in new market with the same product to
counter the rivals. For company market development means expanding into new geographic, vast
customers segments and region to understand the customer and provide product as per taste of
individual.
Diversification:
This strategies help business to diversified their product line. It used by top management
for expansion of business operation in the business industry. Beside this unique and different
product are launched as per the taste and preference of customers. Business person for Ovation
system industry have to adopt diversification strategies to gain competitive advantages. This will
facilitate organization to capture large market share.
TASK 2
P3 Assess potential sources of funding available for organization
To expand business company should endeavour financial assistance from various funding
institute. It has been analysed that Ovation system limited has to require capital for the external
sources so they improve their business operations. It is the prime duty of management to find
out the best funding sources which is suitable for the company. There are some best option for
which are defined below and it can be adopted by Ovation system for expansion. The different
funding sources with there advantages & disadvantage are explained below:
Bank Loans: It is one of the most feasible funding sources which provide long as well as
short term loans. Bank provide loan on minimum rate of interest which attract company to take
loan from bank. There are numerous kind of loan which are offered to customers as per their
requirement. It include educational, personnel, start-up and home loans.
Advantages: The major advantages of this sources is that it provide flexible option to
business venture. Along with this bank have minimal interest rate as compare to other funding
sources present in marketplace.
Disadvantage: To avail this funding individual have to go through long process of
documentation which is a time consuming process. If in case company fails to repay the loan on
time, bank charge high price which create problem for company.

Family and friends: It is most popular funding source for taking loan from friends and
family. This kind funding does not charge any interest as funding are provided by family or
close friends. This kind sources does not require nay legal work as they are totally depend upon
relationship.
Advantages: The main advantage of friends and family is that it does not require any
legal work and it is a time saving process. The interest rate depends upon the relationship and
some it is very low.
Disadvantage: If in case business get into loss it may ruin the relationship with family
and friends. This can be happen due to delay in loan return.
Angel investors: They are the individuals who provide loan to company and also for start
up. They also provide mentoring or financial advice for company. They provide support to
organisation at initial stage.
Advantages: It is less risky than other debt financing and company have not to repay even
bank gets into loss. They also provide guidance to make effective use of resources.
Disadvantage: The prime disadvantage of angel investors is that company loss the
control over business activities. While company have to share profit margin with angel investors
as they become partner with organisation.
Overdraft: It is a sources of fund which allow to take extra funding when amount
reaches to zero (McLean, 2019). This techniques gives permission of withdrawing funds even
there is no money. It is useful for covering short falls and not for covering long term loans.
Advantages: Bank overdraft helps in taking good track of records and it allow for better
payment history. It also ensure timely payments and avoid late payment penalties are been made
even there insufficient amount in the account.
Disadvantage: Sometimes overdraft facilities come with a cost. At time cost are higher
than the other sources it depends upon time. There risk of seizing if company do not pay the
amount.
Crowdfunding: It is a method in which company used to raise funds from large number
of audience by taking help of social media and internet. Here are some pros and cons for
crowdfunding are as follows:

Advantages: Successful funding can get huge amount of attention form social media and
from other modes. It help them to grow beyond what the money and help to expand in market.
This may help to gain goodwill and as well as promotion at larger scale.
Disadvantage: The major drawback of crowdfunding I that of the amount does not reach
to its potential then investors setup back and take money back. If company fails in project than
there is a risk of creating negative impact in market.
P4 Design a business plan for growth
It is tool which is used by organisation for effective functioning in order to achieve the
targets and desired goal. It is crucial for company to have a proper business plan which help in
expansion and profit making in long run.
Overview of the company: Ovation system limited is UK based company which was
founded by Richard Gregory. It head office in located in Springfield Barn, London Rd, Thames.
The company offers best in class services and to their respective customers and also focus on
delivering after sales services (Marcus, 2019).
Products & services: It deals in specialised design of manufacturing of camera, high
performance video surveillance product for police, military and for government law
enforcement. The product range is consist of small and rugged audio and video recorders.
Company also provide high performance microphones as low light mini camera for high quality
services.
Vision: Company have the vision to become the leading manufacturing company in
industry facilitating consumer by providing quality offering.
Mission: Mission of Ovation system is to “satisfy consumers by providing quality
services”
Objective: The objective of Ovation system is to satisfy the customers from their services
and have aim to improve market share from 10% to 20% in coming five years. These objective
of can be achieved by the help of SMART goal which have elements such as specific,
measurable, achievable, realistic and time bound.
Entrepreneurial strategies: Strategies for Ovation system limited is to capture niche
market to provide more and more services to customers. They focus on quality rather than
quantity to attract consumers towards themselves. The target audience for the company are big

organization and institution etc. (Fabos, 2019). firm have to expand their business entity by
using innovative product and services to customers.
Investors : For expanding business, banks is chosen to avail funding and it is initiated to
run business activities smoothly. Company like Ovation can choose loan because it provide loan
which are flexible. Company have not to worry about about paying instalment on time as bank
offer various option for payment.
Financial information:
Finance is required for doing business in well defined manner. It is necessary for a
company to have important information regarding finance to maximize the profit. The company
should be financially sound which help the company to lend money forma various funding
sources. There are various cost associated with the company such as advertisement,
transportation, raw material and other millenniums expenses.
Total forecasted budget
Particular 31/12/15 31/12/16 31/12/17
Implementing
technology cost
16000 There are different
companies which deal
in same product. In
order to achieve
growth and expansion
company have to
implement successful
plan which can help
meeting organisation
objectives.
18000
Promotional expense 8000 9000 10000
Advertisement
expense
5000 8000 12000
Catalogues 2000 6000 9000
Training charges 10000 12000 14000

Total Cost 41000 35000 63000
From the above mentioned budget report, manager of the ovation system limited can idea
regarding the revenue and expenses occur while operating business activities (Yu, Yanxu, and
Bojie, 2019). This will help to create new technology to offer best in class product and services
their respective clients.
Cash flow budget:
Illustration1: Cash flow statement of Ovation system 2018
(Source: Cash flow, 2018 )

From the above mentioned report it has been analyse that company have enough funds by
which they can pay off the liabilities and overhead cost (Krumholz, and Hexter, 2019). Ovation
system have to pay taxes as per the rule and agreements done by funding companies. Cash
receipt from repayments of loans and dividend has same amount every year. In the end cash in
hand of 2015, 2016 and 2018 are 9500$, 2800$ and 3300$ respectively.
TASK 4
P5 Assess exit or succession options for small businesses
Expansion does not provide success and have possibility of negative outcomes which
result in slow down the business operation for company. There are different tools and techniques
through which company can manage to develop goodwill and profit even after loss. Ovation
manager have to make a blueprint for the succession and exit for effective business operations.
Different ways of succession and exit strategies adopted by company.
Exit strategies is a techniques in which investor use to take step back regarding the
funding. This is mainly done when company goes into loss and do not not genrate profit to
sustain in market. There are possibility for Ovation system limited to work effectively so that
desired goal can be achieved. There are several strategies that can be used for entry and exit plan
which are explained briefly:
Winding up: It is a process in by which company assets are collected and sold in order to
repay the debts. When the winding up has been completed, the company is formally dissolved
and it ceases to exist. Company have to pay all the liability to respective stakeholders and
distribute the assets equally to partners.
Advantages: The main advantage of winding up is that company have not face legal
process through and also have no debt on owner (Park, and LaFrombois, 2019). This create and
positive image of company market and in future company may avail loan from government or
other funding sources. When the company is winding up their no debt, and company can start a
new business from scratch.
Disadvantages: The major drawback of winding up is that company have to sell their
assets such as machinery, property and other valuable belonging to other party. Another

limitation is that company will loses their valuable employees and team members as they are
consider the important assets to company.
Selling in open market: In this method company have to sell ongoing business in market
to recover the loss. This may not effect the company as they are selling to third party. This also
provide flexibility in taxes to third party who buy it.
Advantages: One of the important advantages of selling assets in open market company
image does not get hampered in market. This also help new business man to enter in business
industry.
Disadvantage: The major drawback for this method is that it financial position of
company come in front of shareholder and investors which develop negative impact in the minds
of customers. Investors and other funding institution will not lend money in future. It also reduce
the bran value as compared to other organisation dealing in same industry. There are chances of
skilled employees to leave the company if assets are sold in market.
Merger & Acquisition: It is a tern which is used to describe the combination of two
business to make a single company. This is mainly done to capture large market share to make
more profit.
Advantages: Benefits of this method is that it add value to the company and help in
improving efficiency. It open new market for both companies and can grow instantly in new
marketplace. M&A are the cost effective method for upgrading technologies, it allow company
to exchange business, employees to gain competitive advantages.
Disadvantage: The main limitation of the techniques is Ovation system may loose their
skilled employees (Wu, 2015.). Some time company have to work according the other company
this may create grievances among employees and top management in resulting it slow down the
growth and efficiencies.
CONCLUSION
From the above mentioned report it has been figure out planning have its important in
organisation expansion and growth of business venture (Sarin, 2019.). With the support of
effective business plan company are operate their business activity smoothly so that company
can focus on quality offering. For this report Porter's generic model is used for attaining
advantages in over come rivals. Ansoff's matrix is also used to understand the growth and
expansion of a particular industry. It is crucial for company to make strategies for exit and

succession plan for betterment. There are numerous kind of funds which company can avail to
expand their business entity and operate business effectively.

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