Analysis of Smith Brothers: SME, Growth, and Pricing Strategies

This report examines Smith Brothers, a small and medium enterprise (SME) electrical contracting company, focusing on its business development, growth, and pricing strategies. The report begins with an executive summary and introduction to the company, highlighting its services in renewable energy, commercial, industrial, and other sectors. The findings section uses PEST analysis to assess the external environment, considering political, economic, social, and technological factors impacting the business. It delves into the nature of the business, startup processes, business concepts, competitive advantages, current demand, and the impact of the competitive environment. The report analyzes the company's pricing strategy, supply chain effectiveness, and development strategies, including market expansion and international trading. The report also discusses the challenges faced by the organization, particularly in financial management and talent acquisition. The conclusion summarizes the key findings and recommendations based on the analysis. The company's focus on quality, effective services, and technology adoption is emphasized throughout the report.

SMALL AND MEDIUM
ENTERPRISE

Executive Summary
The report will include about the small medium enterprises and its ability of contemporary issues
relating to SMEs and government support which are available to help the business in addressing
the issues. Smith brothers is an active contracting company with registered office in Elland. The
company having 5 directors and 1 company secretary. Smith brothers is a small and medium
enterprise(Henriques and Catarino 2016). ). The aim of the report is to know the development,
growth strategy of business and also the pricing strategy of the business to know and analyse the
deep understanding about the organisation. They are working in the service sector which is
rapidly growing, clients are involved in them from the outset of solar, wind and waste to energy
projects. The idea behind this venture is to offer the quality services which related to the
contracting so that customers can enjoy the quality services from the smith brothers company.
The company is adopting different pricing strategies, growth and development strategies which
help in their success and development. Furthermore, it also concluded that company is in good
and stable position which is concluded from the finding of the various questions.

TABLE OF CONTENTS
Executive Summary.........................................................................................................................2
INTRODUCTION...........................................................................................................................1
2.Findings.........................................................................................................................................1
3.Recommendations...............................................................................................................5
Conclusion.......................................................................................................................................6
REFERENCES................................................................................................................................7
APPENDIX......................................................................................................................................9
.........................................................................................................................................................9

INTRODUCTION
Small and medium enterprise are non subsidiary, and independent firm which fewer than
250 employees and operate at the small scale. In this study, Smith brothers will be considered
which is an active contracting company with registered office in Elland. The company is running
from 20 years and having 5 directors and 1 company secretary. The company provides various
services starting from network connections, cabling, designing, carbon reduction and
maintenance, according to (Hillary 2017)the company deals in four segments that is renewable,
commercial and industrial, offshore, capacity management, and water treatment. Smith brothers
company basically takes an engineering contract and has worked on many projects large, small
and medium overseas. Smith brothers is a small and medium enterprise. The aim of the report is
to know the development, growth strategy of business and also the pricing strategy of the
business to know and analyse the deep understanding about the organisation.
2.Findings
Smith brother being a contracting company is also affected by some external environment
factors which can be analysis with the help of PEST analysis.
Political factors- are some factors which need to evaluate and considered by the
company in order to eliminate the disruptions. Smith brothers being a small and medium
company needs to work in the guideline provided by the authority of SMEs as they are not
allowed to employ more than 250 employees in the organisation and if they do then they will
suffer so considering this factors essential for the company in order to continue smooth working
of the business.
Economic factors- this factors includes change in growth rate, foreign exchange rate,
inflation rate and many other which have direct impact on the operations of the business.
Economic factor are highly responsible for contributing towards the growth of the company.
Smith brothers may suffer loss due to increasing rate of the raw material they required for
carrying on the operations and which directly affect the profitability of the business.
Social factors- these are the factors which include change in the customers' behaviour,
taste, preference, culture, beliefs which have direct impact on the organisation. Smith brothers
need to provide the services and products which have capability of fulfilling the need and wants
of the customers so that they can attain good share in the market and industry for long.
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Technological factors- this factors include the change in the technology which is
required for the good of the industry and economy as whole. Smith brother need to make
alterations and changes in their products and services in new technology so that they can able to
fulfil the needs of their clients by providing them the faster and quality services.
1.Nature of the business.
Smith brothers are the electrical engineering contractors and the company is specialised
in high power projects and have nationwide client base. And they also have a great ability to
manage the complex projects. They are working in the service sector which is rapidly growing,
clients are involved in them from the outset of solar, wind and waste to energy projects. The idea
behind thus venture is to offer the quality services which related to the contracting so that
customers can enjoy the benefits received from the services provided by the company.
As per (Henriques and Catarino 2016) Their team, is made up from the highly trained
electricals, jointer, wiremen and fitters to ensure that safe and professional execution of every job
and project can be done that means the company is Whether working on high and low voltage
distribution system they have great expertise available to them which helps in solving the issues.
The company focusing on providing and delivering the excellence services to the commercial
and industrial mechanic service sector to satisfy their needs and wants related to the particular
project. Basically the nature of the company is Electrical installation and this is a private limited
company.
2. Start up process of small and medium enterprise
The start up process of small and medium enterprises varies from country to country ,
According to (Henriques and Catarino, 2016.) for setting up the SME's the main steps which an
entrepreneur needs to follow are :
The first step Smith and Brothers has to take is choosing and selecting the project on which they
want to work or wants to start their business. It all begins with the idea. The entrepreneur need to
ascertain and analyse the opportunity available to them, about the products and services which
they can offer who holds the ability to fulfil the requirements of the customers so that they can
generate surplus fund.
Another step which entrepreneur have to understand is availability of Technology and
machinery is which is required for setting up the business enterprises. They need to ascertain that
what type of technology then require for developing their products and offerings, availability of
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the technology or cost which they have to incur for that given technology. Machinery
acquirement is another thing which they have to ascertain. In addition, they think about arranging
the finance for making the technology and machinery available at site so that they can start their
projects and operations. Finance can be arranged from different sources that is short term
borrowings, long term borrowings, own funds, savings etc., that is company can also use the
internal financing or external financing for making the funds available to them. The procurement
of funds and enough arrangement of fund is needs to arrange by the entrepreneur so that they can
think of the next steps they can carry.
As per (Karadag, 2015.)Unit development is the process of setting up the unit that is
construction of building or establishment of unit where they can work after deciding this the
utility connections are required to arrange as from where the water and power connections has to
be made etc. After the decision regarding above mentioned points the company needs to take the
approval from the give authorities of small and medium enterprise. Licensing under the industry
sector is compulsory to ascertain.
They need to fulfil all the legal requirements and documents which is required by the
authority to get the certification of incorporation and to be legally accompanied under small and
medium enterprises. Registration under sales tax, under excise duty payment if income tax,
registration regarding partnership deed, power connection, employee strength, collaborations of
weights and measures etc. are required to do implement. And According to (North and Varvakis
2016.) Quality certification is most important for the smith brothers tp have as it is required in
competitive markets and especially when company is going to expand its business
internationally. SSI units are encouraged top particulate in the various quality awareness and
learning programmes which are organises specially for the benefit of the organisation to obtain
the certification.
3.Business concept and source of competitive advantage
The business concept is to provide the general construction and civil engineering and
installation of electric wiring services and many more other offerings or product, targeting the
customer base where these services are highly required like area of factories and industries and
providing the unique and effective services which provides company an effective advantage over
their competitors. The aim of the company is to provide the efficient and effective services at
affordable prices to its costumers so that they can capture good share of the market.
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The business concept followed by the company is widely effective. The company is using
effective technology which helps them to operate their products and services in very efficient
manner which help customers to satisfied their requirements and company to fulfil their
objectives which is ultimately a competitive advantage company can achieve as other contracting
companies are not using such technology at affordable prices.
4.Current demand and impact of competitive environment on organisation
Current demand of the construction sites or installation and equipment is high as in
summers requirements of the air conditioner is increasing. in addition to this other factory
installation and equipment requirements Is also high as there is increasing employment
opportunity which leads to purchase of the equipment and installation services and the aim of the
company is to provide the best and quality products and services to the customers so that they
can create a strong brand value. The competitive environment of the company is affecting the
business of Smith brothers as competitors my providing higher quality services or with low
prices and because of this they might attain more clients compared to the smith brothers. To
avoid this risk of losing customer Smith brothers need to use the advance technology so that they
can provide the best and effective services to retain the customers for long. Company need to
analyse and evaluate the competitors' price and product strategy for long run growth.
5.Pricing strategy of business
Penetration pricing strategy is followed by the business because there initial years market
capture is high and that was due to offering good quality product and services by keeping the
prices low for new technology and after the company seeks to earn good profit they lead to
increase their price to earn higher profits.
6.Demand is fulfilling by effective supply
The demand of the company products and services is generally high and by experienced
employees, the company is able to fulfil the customers demand by effective supply that is on the
time so that they can satisfy their needs and wants. Also, the company focuses on maintaining
the quality with effective supply.
7. Development strategy followed by the company
The Development strategy which company can follow by the company is market
expansion. The company can focus on providing quality and efficient services in the area where
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they not providing currently. They can reach to that market by brand advertising, promotions,
providing quality services etc. and they will be able to expand their service providing in different
markets also which leads them in developing their business. Market expansion can also be done
by trading internationally which helps in capturing wider market help in overall development of
the business.
8.Affect to the growth and development due to challenges faced by the organisation.
Company faces different challenge of different sectors. Financial management is great
challenge for the company as they have to face all the inflows and outflows which is the complex
task which is to be perform effectively by the managers. As complete financial health of the
organisation arises from the efficient management only. Mismanagement leads to barrier in the
growth of the organisation.
Recruiting the right talent is another challenge for the organisation. As in view of
(Krishnan and Scullion, 2017.) company have to place and recruit the right person at the right
job. Any mistake leads to great barrier in the development of the organisation as human resource
is the most important resource of the organisation who manage all other resources. The mangers
will ascertain the challenges by analysing and evaluating the internal and external environmental
factors and their impact which might to be faced by the organisation and to avoid and eliminate
those risk they take corrective measures to prevent the company from any loss or damage.
9.Organisations product quality satisfying the customers or not
The company product and service quality satisfying the customers as the customers
remain attracted towards the company's offerings which is sign of their satisfaction. Customer
feedback also helps them to know that the product is capable of satisfying the customers needs
and wants or not. In addition to this retention of customers is the biggest way through which
company is able to know that customers satisfying with the goods and services delivered to them
or not. As if the services not satisfying than they will start losing the customers. Hence, more
retention of customers means higher satisfaction among the customers in the market.
3.Recommendations
The company is following the Market development and penetration pricing method
which is highly effective. They must carry on to continue these strategies are this will help them
to capture the larger and new market which helps them to explore their product in different
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segments. They should also use the market expansion strategy which helps to capture the
different areas of markets and through which they can capture the larger market share which
ultimately increases the brand value of the organisation and creates goodwill among the
customers of different segments.
The cost of expanding the market high which they need to manage from various sources
as this investment will lead the organisation to the path of growth and success. Company can
arrange finance from other sources which includes debt oriented funds, borrowings from
financial institution etc. and based on company's preference they can go with one or more source
for finance. Strong brand leads the company in international trading which also help them in
achieving all their objectives and goals and will also help company to capture larger market and
creating strong brand value which help in further development of the company.
Conclusion
From the above report it can be concludes that smith brother is contacting company
which based on small and medium enterprises. The company is adopting different pricing
strategies, growth and development strategies which help in their success and development.
Furthermore, it also concluded that company required to take some development strategies which
helps them to eliminate their issues and challenges faced by them and development strategies
also help them to expand their business and market.
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REFERENCES
Felzensztein, C and et.al., 2015. Networks, entrepreneurial orientation, and internationalization
scope: evidence from Chilean small and medium enterprises. Journal of Small Business
Management.53.pp.145-160.
Giaoutzi, M., Storey, D.J. and Nijkamp, P., 2016. Small and medium size enterprises and
regional development. Routledge.
Henriques, J. and Catarino, J., 2016. Motivating towards energy efficiency in small and medium
enterprises. Journal of cleaner production.139.pp.42-50.
Hillary, R. ed., 2017. Small and medium-sized enterprises and the environment: business
imperatives. Routledge.
Karadag, H., 2015. Financial management challenges in small and medium-sized enterprises: A
strategic management approach. EMAJ: Emerging Markets Journal. 5(1). pp.26-40.
Khalique, M., Bontis, N., Abdul Nassir bin Shaari, J. and Hassan Md. Isa, A., 2015. Intellectual
capital in small and medium enterprises in Pakistan. Journal of Intellectual Capital.16(1).
pp.224-238.
Krishnan, T.N. and Scullion, H., 2017. Talent management and dynamic view of talent in small
and medium enterprises. Human Resource Management Review. 27(3). pp.431-441.
Lee, K.H., Herold, D.M. and Yu, A.L., 2016. Small and medium enterprises and corporate social
responsibility practice: A Swedish perspective. Corporate Social Responsibility and
Environmental Management. 23(2). pp.88-99.
North, K. and Varvakis, G., 2016. Competitive strategies for small and medium
enterprises. Increasing Crisis Resilience, Agility and Innovation in Turbulent Times.
Cham: Springer.
Trianni, A., Cagno, E. and Farné, S., 2016. Barriers, drivers and decision-making process for
industrial energy efficiency: A broad study among manufacturing small and medium-sized
enterprises. Applied Energy.162 pp.1537-1551.
Wynarczyk, P., Watson, R., Storey, D.J., Short, H. and Keasey, K., 2016. Managerial labour
markets in small and medium-sized enterprises. Routledge.
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Wynarczyk, Pand et.al., 2016. Managerial labour markets in small and medium-sized
enterprises. Routledge.
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APPENDIX
1. What is the nature of the entrepreneur behind starting up the venture?
2. What is the start up process of small and medium enterprise?
3. What would be the business concept and is there is any source of competitive
advantage?
4. What is the current demand and impact of competitive environment on your
organisation?
5. What is the pricing strategy for your venture?
6. Is demand is fulfilled by effective supply or not?
7. What development strategy is followed by your company?
8. What will be the growth and development of the business regarding the challenges of
managing and running the business smoothly and effectively?
9. What is the current growth strategy of your company?
10. Your organisation's product quality is satisfying the customers or not?
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