Strategic Development and Implementation for SMEs: Case Study Report

This report conducts a comprehensive strategic analysis of Oak Cash and Carry Limited, an SME operating in the wholesale grocery sector. It begins with an executive summary and an introduction highlighting the importance of SMEs in the UK economy. The main body employs strategic analysis tools, including PESTEL, Porter's Five Forces, value chain analysis, and SWOT, to assess the external and internal environments. Strategic choices are then explored using stakeholder analysis, Porter's generic strategies, and Ansoff's Matrix. The report concludes with strategic action recommendations, outlining implementation techniques, timelines, and expected outcomes. The analysis emphasizes the competitive landscape and the need for strategic adaptation for SME success and sustainable growth. The report also covers the impact of political, economic, social, technological, ecological, and legal factors on the business, and how these factors influence the strategic decision-making process. The report provides insights into the challenges faced by SMEs and offers a framework for strategic planning and implementation to enhance their performance.

Small and Medium
Enterprises (SMEs)
Strategy Development

EXECUTIVE SUMMARY
The present scenario of business environment shows the importance of small and
medium enterprises in the market. It is identified that the contribution of small and medium
organizations is increasing day by day. This shows that they are doing very well and getting a
successful business. It enables all small people to start their own business with minimum
funds. This helps in providing employment opportunities, increasing in income level, self
reliant, etc. So that's why now countries are focusing on developing more small and medium
enterprises. But it is not very easy task. For the success and sustainable growth of small and
medium organizations, it becomes necessary for every enterprise that they should formulated
strategy in order to produce best quality products and satisfy their consumers.

Table of Contents
EXECUTIVE SUMMARY........................................................................................................2
INTRODUCTION......................................................................................................................4
MAIN BODY.............................................................................................................................4
STRATEGIC ANALYSIS.........................................................................................................4
External Analysis - PESTEL..................................................................................................5
Industry competitiveness analysis - Porter’s Five Forces Model...........................................7
Internal Analysis -Value Chain Analysis...............................................................................8
SWOT....................................................................................................................................9
STRATEGIC CHOICES..........................................................................................................10
Stakeholder Analysis – Mendelow’s Matrix........................................................................10
Competitive Strategic – Porter’s Generic Strategies............................................................11
Different Strategic Direction - Ansoff’s Matrix...................................................................12
SFA......................................................................................................................................12
STRATEGIC ACTION............................................................................................................12
Implementation of best suitable strategy..............................................................................12
Time frame/scale with actions.............................................................................................12
Outcomes from the strategic implementation......................................................................12
CONCLUSION........................................................................................................................12
REFERENCES.........................................................................................................................13
Books and Journals:.............................................................................................................13

INTRODUCTION
Small and medium enterprises are the organisations which have a turnover not more
than £6.5 million, according to the section of 382 and 465 in Companies Act, 2006 in UK. A
balance sheet total of small and medium enterprises should not be more than £3.26 million.
Small and medium enterprises are not allowing having employees more than 50 (Yuntriani
and Dewi, 2020). It is identified that small and medium enterprises now plays a very crucial
role in the trading sector of UK. They just not well perform in local market but also show a
great growth in global market. Small and medium enterprises rise day by day that's why it
shows a great contribution in the economy of UK. Due to their contribution, it is identified
that the economy growth is increasing very fast. It can be clearly show from the turnover of
UK business i.e. £726,855 which is collected from small and medium enterprises. The reason
of increasing the number of small and medium enterprises is that they provide opportunity to
small or poor person which can start their own business with minimum funds. This is the
reason that why every country is focusing on development of small and medium enterprises.
In this context, Oak cash and carry limited is undertaken for showing the importance of small
and medium enterprises. Oak cash and carry limited is a small organisation that deals in
wholesaling of groceries. They have approximate 30 employees and generating average
revenue $5.13 million.
MAIN BODY
STRATEGIC ANALYSIS
Oak cash and carry limited is a small size organisation which runs their business very
well. It becomes possible when they are thinking about strategic analysis. Strategic analysis is
the process where organisation tries to understand the market so that they can make strategies
accordingly. Business environment is very competitive and complex (Rhommadhonni and
Dhewanto, 2019). It is filled with many uncertainties which become risk for small and
medium organisation. This is a reason that why Oak cash and carry limited give focus on
strategic analysis. For that purpose they need to analyse external environment as well as
internal environment. They also consider the analysis of industry competitiveness. So that
they can come on their conclusion that stated what to do for the growth and success of
organisation. In addition to this, Oak cash and carry limited found some important tools and

techniques which help them to strategic analysis. All tools and techniques are mentioned
below:
External Analysis - PESTEL
External environment is filled with much uncertainty which can be occurred due to
many factors. External environment is uncontrollable by organisation so that's why they need
to adopt or accept it (Harney and Alkhalaf, 2021). But they can easily deal with formulating
best strategy in order to reduce the consequences of changes in external environment. It can
be better understand with the help of PESTEL analysis. It contains some important factors of
macro environment that are mentioned below:
Political factor
Under the macro environment, the political factors are concerned with political parties
and the interference of government between organisation functions and operations. It includes
taxation policies, level of bureaucracy, foreign trade policy, grants for funding in small
organisations, etc. Small and medium enterprises cannot run their business on own capital
because they have not enough money to start a business. For that purpose they are moving
towards loans and borrowings from governments (Vlacsekova and Mura, 2017). Government
provides loans at minimum rate of interest to the small and medium enterprises. Oak cash and
carry limited is started by the borrowings of government. UK Government always supports
small and medium enterprises because it helps in raising their growth rate of economy. This
is the reason that Oak cash and carry limited cannot take any worry about their financial
needs. But if it is found that there are any changes in political parties then it will directly
impact on the organisational performance. One important issue of political factor i.e. Brexit
which is the separation of European Union with UK. It gives a great impact on every
organisation because all trade relations are now separate from each other.
Economical factor
Economical factor include interest rates, inflation rate, economic growth, stock
market performance, etc. Economical factors have a great impact on small and medium
enterprises’ decision making process (Zhou and et. al., 2018). The decision is depending on
the performance of economic growth. Small and medium organisations contribute a good
proportion in economic growth. This implies that government should support to these
organisation because it helps to increase the growth rate of economy and decrease inflation

rates. In the business current scenario, COVID-19 gives a great impact on every country's
economic growth rate. Due to pandemic situation, there were announced a lockdown which
close every business whether it is large or small. It gives a very negative impact on the
growth and success of Oak cash and carry limited.
Social factor
Social factors include religion, caste, perception and behaviour of consumers, current
trends in the market, etc. It is very necessary for the small and medium enterprises that they
should focus on social factors because they are connected with the consumer (Ivanova and et.
al., 2017). Consumer satisfaction is the ultimate goal of any organisation whether it is a large
or small firm. It can be achieved only when organisation can able to understand the
perception and behaviour of consumer. It is also identifying that every person is not
comfortable to work with the smaller organisations because they feel that they should work
for large organisation forgetting prestige and image. That's why it becomes threat for small
and medium organisation such as Oak cash and carry limited to recruit talented employees. It
becomes very difficult for employees to convince them for working in their organisation.
Technological factor
Technological factor is becoming one of the most important factors because day by
day technology is upgraded. With the use of technology an organisation creates is for
employees. But it is not easy because for that purpose companies need to be aware in the
market (Krishnan and Scullio, 2017). Small and medium enterprises have not much experts
which have knowledge of latest technology. It creates threats for company that they cannot
able to use latest technologies. If small and medium enterprises are focusing on using of
technologies then they can easily get success and growth. It can be done with the use of
digital marketing methods which includes social media marketing, email campaigns, etc. It
creates opportunities for organisation in order to attract more and more customers.
Ecological factor
The current trend of business environment is focusing on the growth of organisation
but it should be sustainable. That means organisation should perform all activities in a
sustainable way so that they cannot harm nature and environment (Raimi and Uzodinma,
2020). It is the duty for organisation that they need to provide best quality of products with no
harm of nature to customers. It is identified in the case of small and medium enterprises that

they are become trendsetter for sustainability. Small and medium enterprises have a great
idea of doing their business in a sustainable way in which they are try to reduce plastic. Oak
cash and carry limited is the organisation that uses technology in a very well manner in order
to reduce pollution and increase sustainable development.
Legal factor
Legal factors include all rules and regulations which should be completed by every
organisation. Different countries have different types of rules and regulations such as equality
law, employment laws, etc. It is very necessary for small and medium organisation that they
should work within laws.
Industry competitiveness analysis - Porter’s Five Forces Model
Oak cash and carry limited need to analyse the competitiveness in industry because
their success and growth is depends on competitors' strategy (Purwandari, Otmen and
Kumaralalita, 2019). With the help of analysing competitive strategy Oak cash and carry
limited can easily formulate better strategy and achieve their goals and objectives. It can be
done with the help of using porter's five forces model. It consists of five forces that come
from industry which explain in below section:
Threats of new entrants
In the case of small and medium enterprises, types of new entrant are very high for
Oak cash and carry limited. This is high because of the entry of a small and medium
enterprises are very easy and less expensive (Hlushko, 2020). It creates threats for Oak cash
and carry limited. For that purpose they need to create effective strategies which help in
reducing the threat of new entrants.
Bargaining power of customers
With the increasing of small and medium enterprises day by day the bargaining power
of customer is also increases that means it is high (Dar, Ahmed and Raziq, 2017). Increasing
in bargaining power of customers create complexity for small and medium enterprises
because they cannot raise their product prices. Customers have many choices to purchase
their product from enterprises. Large firms also provides same type and qualities of product
at reasonable prices which becomes very tough for small and medium organisation that how
they can attract customers and retain in their organisation.

Bargaining power of suppliers
In the market, bargaining power of suppliers is depends on the companies nature. That
means different types of industry have different bargaining power of suppliers (Mashahadi
and Ahmad, 2020). In the case of retail industry, Oak cash and carry limited faces low
bargaining power of suppliers. It states that there are number of suppliers available in retail
industry which reduce the bargaining power of suppliers and it becomes very beneficial for
small and medium enterprises that they can raise their profit margins.
Threat of competitors
It can be clearly seen that small and medium enterprises have very high threat of new
entrants which automatically increase the threat of competition. For that purpose, Oak cash
and carry limited need to analyse the competitive strategy in order to formulate better
strategies. It will help in to take a competitive advantage even in the competitive world.
Threat of substitutes
There are number of firms which provide same types of products even at better
quality. This will automatically create threat of substitutes because customers cannot rely
only on one brand. They always try to use better one with reasonable prices. If they get any
chances then they can easily switch to other products. Oak cash and carry limited need to
concentrate on the product quality and prices with use of some innovation and creativeness.
This will help in to reduce the threat of substitutes.
Internal Analysis -Value Chain Analysis
External environment is uncontrollable and it should be analysed by every
organisation so that they can reduce risk and uncertainties. But it is similar important to
analyse internal environment of organisation (Decius and Schaper, 2017). Internal
environmental analysis is necessary because the challenges which come from external
environment can only be overcome when company have a good internal environment. For
that purpose, Oak cash and carry limited need to use value chain analysis in which they are
identifying the internal capability to deal with external environment. Value chain analysis is a
very important tool for identifying primary and support activities. It is mentioned below
about primary and support activities of Oak cash and carry limited:
Primary activities

It includes:
 Investment team: It is concerned with managers and investors of Oak cash and carry
limited that make sure about all important decisions such as investment in machinery
and equipment, land, etc.
 Operations and traders: This is concerned with the orders of client which should be
match with their expectations. For that purpose, Oak cash and carry limited's
operation manager should be confirm that what the need of clients are. It helps them
to effectively fulfil (Alexander, Antony and Rodgers, 2019).
 Marketing and sales: In this activity, Oak cash and carry limited look at every
possible marketing campaign so that they can increase the promotion of their
business.
 Service: In this activity, they are touch with their clients in order to build customer
loyalty with the problem solving approach.
Support activities
It includes all those activities which effectively support to the primary one for
accomplishment of organisational goals and objectives:
 Technology: This becomes the best support for any organisation because they can
easily purchase and sell with the help of using software and digit business.
Technology is playing a very important role in all activities.
 Human resource: The most important support activity which helps to accomplish
organisational goals and objectives. Without human resource it becomes impossible
for Oak cash and carry limited to perform primary activities and run their business.
SWOT
SWOT analysis is a tool that helps to analyse internal environment and which makes a
conclusion. With the help of analysing internal and external environment now SWOT
analysis gives a conclusion. It is mentioned in below table:
STRENGTHS WEAKNESS
 Oak cash and carry limited has a good
knowledge of market which helps
them to formulate better strategies.
 It is a new start-up which has lack of
financial assistance.
 There are very less employees which

 They provide fast delivery of grocery
to the retailers. It helps them to attract
retailers.
become a shortage of experts in order
to make strategies.
OPPORTUNITY THREATS
 With the help of using technology
they can transform their physical
business into digital business.
 Due to the small and medium
enterprises, they have a big support
from government which assist them
to take borrowings and loans at low
prices (Ibrahim and Mustapha, 2019).
 There are very less entry barriers
which invite many new entrants in the
market.
 The number of companies or
competitors exists in the market that
provides same type of products and
services with quality.
From the above discussion, it becomes very clear for small and medium enterprises
that they need to analyse strategically each and every thing which effects on their operations
and functions. With the help of important tools small and medium organisation can easily
analyse internal and external environment. Tools such as PESTLE, value chain, porter's five
forces model and SWOT analysis become very helpful for small and medium organisations.
STRATEGIC CHOICES
Stakeholder Analysis – Mendelow’s Matrix
Stakeholder analysis is very important for analysing the stakeholder’s needs and
wants. Stakeholders other person who are actively participate in the organisation which
includes customers, government, investors, owners, etc (Abbasi, Wang and Abbasi, 2017).
This is very important for Oak cash and carry limited that they should analyse stakeholders
which can be done with the help of Mendelow's matrix.
 High power, highly interested people: It considered those people who want to engage
with the organisation functions and operations. It includes owners which took an
active part in order to manage all organisation functions. They have high power and
highly interested in the company's operation.

 High power, less interested people: In this category, it includes all stakeholders which
have less interest but have high power. A considered consumers because they have a
high power which impact on decision making process of organisation but almost they
are less interested. Organisation always needs to keep them satisfied and make sure
that they are not getting bored with their message.
 Low power, highly interested people: These people include which are highly
interested in the organisation but they have less power. It is considered to all investors
as they are interested in the company but they have not a power to take any decisions.
Oak cash and carry limited need to keep inform to these people that there is no issue
arising in the company.
 Low power, less interested people: These people include government which are not
access communication with the company. For these people, oak cash and carry limited
need to keep an eye in order to check the level of interest.
Competitive Strategic – Porter’s Generic Strategies
Porter's generic competitive strategy is very effective for organisation that it helps in
taking a competitive advantage in the market. With the use of this strategy Oak cash and
carry limited get to know that where they are lying and what they have to do. It contains four
major variant those are mentioned below:
Cost leadership
With the help of cost leadership strategy companies able to become a low-cost
producer which can easily target maximum audience. If o cash and carry limited can achieve
and sustain overall cost leadership then they can easily become an average performer in the
industry.
Differentiation
In this strategy a company produces unique products as compared to their competitors
which become the differentiation factor. It covers fewer buyers who perceive that uniqueness
is important. In this case, organisation awarded for its uniqueness in the products with the
help of a premium price for their goods and services.
Focus

Focus strategy is the one which provides options that company can be used
differentiation or cost leadership in the niche market. It is necessary for small and medium
enterprises that they should clear in the mind that it does not mean market it will be smaller
because they have a small size of a business. It just depends on the organisation that what
they have to do. They have a option to focus on multiple products and services or consider
only one.
From these strategies, company can be able to get success and growth and competitive
advantage in the market. They choose strategy after evaluating their business activities that
which strategy is match with their objectives and goal.
Different Strategic Direction - Ansoff’s Matrix
The Ansoff of matrix is also known as the product extension tool which is applied by the
organisation in order to examine and formulate their Strategies and planning for their growth
and development. This Matrix represent the four strategies which help the organisation to
grow and examine the risk which is associated with the every strategy and planning. This
Matrix was developed by the mathematician and business manager that is H. Igor ansoff and
this was published in the Harvard Business in 1957. This Matrix support several marketers in
executive in order to understand the risk factors which are growing in their business and help
them to overcome the uncertainty. There are four strategies of answer of matrix which is
product development market development diversification and market penetration. Product
development is focusing on introducing fresh products into the existing market in the market
development strategy is focus on entering into new markets by using some old products and
their old strategies. The market penetration is strategy which focusing on raising the sales of
existing products in the existing market and a last strategy which is diversification that is
concentrating on entering into the new market with introducing some fresh products and fresh
Strategies.
Market penetration: In the market penetration of the chosen organisation is using their
product in the current or existing market. Also the organisation is achieving their goal and
setting their goal in order to raise their market share with the strategy (Abou-Shouk, and
Megicks, 2016). This is strategy can be acquired by the company in several ways and which
is Decreasing in price in order to Grab more new consumers. Raising the promotion and
distribution efforts in order to meet with more consumers and attract them. Getting a
competitor in the same Marketplace. These are the strategy which are focused by the chosen