SBT's Growth: Analyzing Strategies, Finances, and Business Plans

This report provides a comprehensive analysis of growth strategies for Southern Business Technologies (SBT), a telecommunications solutions provider. It begins with an introduction to the importance of planning for business growth, emphasizing the need for systematic approaches to achieve goals. The report then delves into Task 1, evaluating major considerations for growth opportunities, including competitive and external market analyses using Porter's generic model and PEST analysis. Task 2 explores the application of Ansoff's Matrix to identify growth opportunities, focusing on market penetration, market development, product development, and diversification. Task 3 discusses potential sources of funds available for enterprise growth. Finally, Task 4 outlines the design of a business plan for growth and assesses succession or exit options for small enterprises, considering their advantages and disadvantages. The report concludes with a summary of findings and references used.

Planning for Growth

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Major considerations for evaluating the opportunities of growth.....................................1
P2 Growth opportunity by implementing Ansoff's matrix.....................................................4
TASK 2............................................................................................................................................6
P3 Potential sources of funds available for enterprise............................................................6
TASK 3............................................................................................................................................8
P4 Design a business plan for growth....................................................................................8
TASK 4..........................................................................................................................................10
P5 Assess succession or exit options for small enterprise with its advantages and
disadvantages........................................................................................................................10
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Planning is one of the crucial part of every business association as it ensure their future
growth and success. Every successful firm follows a systematic plan so as to attain their goals
and objectives in a certain period of time. While planning, managers are required to review their
progress and determine growth areas accordingly; it will turn a business plan into static
document and works as roadmap for the company. Along with this, planning for growth also
relies upon adequate allocation of resources and focus on their optimal utilisation in order to
increase performance and productivity (Barbour and Deakin, 2012). The present assignment is
based upon Southern Business technologies Ltd., which is providing communication solutions to
businesses. SBT renders a wide range of bespoke telephone system solutions which are designed
to support business requirements, such as – upgrading communication, improving productivity,
lowering costs and diversifying the workplace. Apart from this, the report will describe
evaluation of growth opportunities for corporate entities by considering Ansoff Matrix. There
will also discuss various sources of finance which helps enterprise to effectively accomplish their
working activities. At last, a business plan will develop which guides to do things which helps
SBT to gain high competitive edge.
TASK 1
P1 Major considerations for evaluating the opportunities of growth
The foremost objective for every business is to attain high market growth and share, all
this can achieve through planning of various aspects, i.e. acquisition of digital technology,
factors present in market, sources of funding etc. Therefore, planning provides an opportunity to
small entities to identify strategies and policies so that employees get proper guidance towards
doing all tasks and activities. Although, implementation of new and innovative technologies in
business processes support in completion of all operations in best possible manner (Brinckmann,
Grichnik and Kapsa, 2010). As the project manager have only 2 month to prepare a well
articulated strategy thus he has decided to apply competitive analysis and external market
analysis which is briefly stated as under -
Competitive analysis – Obtaining maximum defensible edge is critical element of
planning process. As SBT Ltd., is a telecom service provider company as it emphasis on
improving communication networks of companies with their customers. In this relation, the firm
generates new and innovative telecom services which are unique, innovative, flexible to use in
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nature. Therefore, to remain competitive managers have to develop effective policies and
services which supports companies to beat its rivals. Various modifications should also take
place thus to boost up functional or operational area of companies.
Competitors analysis can be accomplish by porter's generic model
While planning for future growth, firms are required to analyse their competitors who can
hinder their market position in future. Thus, to make a competitors analysis managers have can
consider the framework of Porter's generic strategy which describes proper information about
competitors (Burton, 2010). The theory acquire by Southern business technologies to implement
strategic position at marketplace and obtain high profit margins.
Cost leadership: In this, firm targets broad markets and offer products at lower rates.
Cost leadership strategy involves two options, i.e. either to keep prices as low as possible or to
have wide market share with normal prices. Business associations who apply this tactics usually
have substantial capital to invest in their disposals and adequate logistics. In cost leadership,
firms are focused on improving their internal processes. Furthermore, the approach requires close
interaction between all functional areas; in order to be low cost producer management taken into
consideration high level of productivity, high capacity utilisation, lean production methods etc.
Differentiation leadership : In this approach, firms seeks opportunity to become unique
and effective in their industry by implementing certain dimensions which valued by customers.
Differentiation implies to make product or service innovative and differentiate from all other
alternatives. In this strategy, the prime aim of business owners is to attain cutting edge by
differentiate themselves from whole industry (Chapin, 2012). As SBT Ltd., is a telecom
company - it always prefers to design effective telecom products by adding software applications
i.e. CRM integration licenses it enables large corporations to meet their target audiences.
Cost focus – Here, firms target niche markets and provides products on lower prices. In
cost focus strategy management selects a clear niche target market by understanding its
dynamics as well as customers' needs. In today's market personal customer contact is the key to
gaining a competitive edge and ensuring customer satisfaction; so that Southern Business
technologies tries to improve its communication solutions and offer it on lower prices so as to
attain more and more people at marketplace.
Differentiation focus: It is known as classic niche marketing strategy, several SMEs are
enable to establish themselves in niche markets by using that tactics, obtain high profits than
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normal products by expertise and other ways which adds value for customers. Furthermore, the
main issue with that strategy is to recognise that whether or not differentiation is valid; it means
customers really have different needs. In this strategy, the main objective of businesses is to
target small range of people in their target market segmentations and develops products for them
(Christofakis and Papadaskalopoulos, 2011).
All of these above strategies, SBT Ltd., can acquire differentiation focus strategy thus to
gain in which firm will provide unique products at cheap rates which supports it in gaining high
competitive edge and other market benefits. Although, the strategy also contribute in attaining
and retaining customers for long run.
External environmental analysis – The assessment is done in order to analyse all those
factors which have vast impact on business decisions and working activities. Although external
environmental analysis can be done through PEST analysis thus to identify external market
environment and formulate strategies accordingly. Below is defined PEST analysis of SBE Ltd. -
Political factors
In UK, due to political instability regulation
issues are coming up frequently. As
government have other idea i.e. how telecom
should be managed and people have other
(Eddleston and et. al., 2013). Another political
risks for SBT Ltd., are network licensing,
national radio spectrum, and in case of certain
nations trade barriers, tax rates, import &
export policies.
Economical factors
After economic recession in 2008, people have
cutting back their spendings on telecom
services due to low income.
Economic factors involves interest rates,
exchange rates, currency and fluctuations rates,
monetary policies and so on; all these cam
really affect purchasing decisions of buyers.
Social factors
These factors have great influence on sales and
profitability of business organisations. Changes
in customers' needs and preferences they want
flexible telecom services which costs are
lower. Many small businesses also takes
initiatives in social welfare, as they are tend
towards fulfilling corporate social
Technological factors
After globalisation, technology is changing
rapidly thus to remain competitive small
businesses are tend on adopting new
technology and innovations in its working
processes. For example – SBT Ltd., is offering
cost effective business mobile solutions from
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responsibilities in the best possible manner. all main mobile network providers.
From the large number of opportunities which are identifies by the management of
organisation they are decided to expand the business at the new area where large number of
corporate business are operating their business act ivies. This provides the various opportunities
is to expand business through providing better telecommunication and networking facilities. This
will helps in enhancing the brand image of organisation along with the satisfaction of the
requirements of clients.
P2 Growth opportunity by implementing Ansoff's matrix
In this ever changing business environment, most of the corporations willing to grow and
radiate in their target market by applying advanced tactics and policies. It supports them to
sustain high cutting edge in a minimum time frame. The chosen business entity, SBT Ltd., works
as per the market trends and for this it also formulate impulsive marketing strategies so as to
expand brand image and market goodwill among customers. In order to demonstrate growth
opportunities in external surroundings management can uses various tools and techniques.
Although, the firm wants to expand its market area and position as well (Grover, Bokalo and
Greenway, 2014). Thus, SBT Ltd., adopt Ansoff Matrix in order to identify growth
opportunities in various markets. It enables company to assess those areas in which it can
develop and explore its products.
Ansoff Matrix is known as strategy of market diversification in which business get
diverse into one market to another or one product from another. It involves four quadrant which
increase market area of firm. There is given in-depth description of all aspects the matrix -
Market penetration – It refers that firm will sell its existing products or services in
present markets. In order to increase sales and profitability, managers can acquire various tools
and technologies. Southern business technologies has a great opportunity to penetrate in their
current market by improvising its distribution processes and working activities. On the other
hand, companies can also use various effective marketing and promotional strategies for gaining
high competitive advantage (Hough and et. al., 2010). For example – SBT can use cost effective
techniques to provide mobile networking services.
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Market development: In this, managers get entered into new markets thus to increase
their market areas and gain high market position as well. Marketing development strategy will
bring out numerous opportunities for SBT in respects of enlarging customers' base and raise
sales and profitability. It is one of the more effective and flexible strategy in comparison with
other threes. Although while expanding their market area business owners have to assess
geographical area of market just to recognise that whether or not their offerings are matched up
customers' needs and wants.
Product development: In this quadrant, managers focus upon improving their products by
adding quality in them and also generate new and innovative goods which are able to satisfy
buyers' expectations in best possible manner. SBT Ltd., has recently modified its telecom system
by implementing hardware and software in modular way. The core concept of product
development is to fulfil customers' needs and wants in the best possible manner. It increase
economics of scale of small businesses and attain numerous customers towards it (Keough,
2015). Thus to improve its service line, management should implement digital technology in its
processes provide effective communication solutions to its clients.
Diversification: This block refers to serve in new markets with new products thus
diversification strategy is quite risky for business ventures. Although, companies do not have any
idea about new market trends, customers' values, beliefs and attitudes towards things. All these
can really affect sales revenues and profitability of small businesses. Thus, while diversiify into
new markets by carrying new offerings managers should conduct a market research thus to know
customers' taste and preferences. For example – before introducing any new mobile software in
new market SBT Ltd., needs to recognise it demand among between people.
After assessing all those aspects, the best one can be chosen by Souther business
technologies is product development. The strategy supports to attain corporate goals and
objective of businesses, i.e. emerging new markets, high sales etc. A success product
development strategy would be beneficial for companies but it requires careful planning focus
on minimising risks. Apart from this, other tactics is market development – in this firms are
required to address best potential markets which can gives them high profitability (Li, Mobin
and Keyser, 2016). Although the major risk of acquiring this strategy as it requires high capital
investment which is not possible for small businesses. Therefore, identification of suitable
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market helps small business to gain high competitive and they will enable to serve effectively at
there.
TASK 2
P3 Potential sources of funds available for enterprise
In UK, area of small businesses are getting wide as now these firms are exploring at
international level also. Thus to manage all functional and operations in systematic way,
entrepreneurs require high amount of capital and SMEs do not have enough availability of funds.
UK government has executed certain policies which ensure to provide funds or capital to small
businesses as they run smoothly. As Southern business technologies has decided to acquire
market development and product development thus to gain high growth opportunities. Both
tactics require high amount of capital or investment; it leads implementation of growth strategies
in proper manner. Furthermore, financial sources are also required in succession planning of
organisations. Below is defined various sources of finance : -
Bank loan: This is the most common source of getting funds for business. There are
various rules and regulations developed by government of UK for those who are planning for
starting a new venture. The small business are taking funds at very low interest rates for running
their business activities effectively. Other sources of getting funds for business are angle brokers,
society etc. Advantages: The rate of interest is fixed at which loans are granted by banks and firms
had to make payment accordingly. The importance of bank loan is that provider is having
limitations and the organisation cannot sue for giving advanced payment (Pallagst,
2010). Disadvantages: As the rate of interest on loans are fixed thus firms have to make
payment and they cannot bargain wheatear then they are suffering from loss or earning
huge profits.
Crowdfunding: This is the best option for firms who are having large network and they
have to ensure trust and loyalty before starting their business operations. The capital or finance is
maximised by using different online networks & social networking websites so that people can
contribute funds for the project in exchange of equity. There are cases when funds are maximised
by using different websites such as OzCroed and Pozible.
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 Advantages: This is the simplest way of raising fund as there are no charges. The process
can be evaluated by investors for analysing their progress this results in inspiring brand
by its network chain. This results in retaining loyal customers by their financing process.
 Disadvantages: The ideas of company cannot be secured by applying patents and
copyrights. The returns and rewards of firms can be negative if they are focusing more on
investors.
Peer to Pear lending: This is the vital approach of debt financing that results in lending
and borrowing money without any help of financial intermediaries. The process of middleman is
also removed but factors related to risk, effort and time is involved. Advantages: This is the fastest process dealing in online applications and the rate of
interest is lower while making comparison with funding institutes and credit cards. The
rate of interest on which loan is granted is fixed and there are no hidden charges applied. Disadvantage: In this method high funds are not available. The firm is having lower
credits as the rate of interest is much higher in long run. This results in issues which is
related with panic selling (MacLeod, 2013).
Venture Finance: This method generates higher risk of capital which is mainly directed
towards new business start-up with the objective of faster growth and higher returns. The
investment is not only related with funds but also time and skill. The entrepreneurs are providing
loan for research and development area and capital is generated for managing layouts. Advantages: The major advantage of this method is they are having ability to increase the
bank loan which cannot be possible with other method through granting bank loans.
 Disadvantages: Safety and security of money is much typical process due to legal and
accounting cost of business operations.
As above mentioned sources of finance SBT Ltd., used Bank loan and Peer to Pear
lending as it supports firms to provide finance. As bank loans are the easiest and flexible source
of providing funds; credits can give for long and short term period as well as may be depends
upon secured and unsecured circumstances. In UK, there are numerous banks or financial
institutions which are available to provide capital to SMEs. On the other hand, another effective
source of finance is peer to peer lending which is also known as social lending. P2P lending
boost returns for individuals' as they can easily borrow online or offline. It is a fast and easiest
form of which also provides funds to SBT on cheap rates.
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TASK 3
P4 Design a business plan for growth
A business plan is a document which defines new model of an organisation and its
offerings as wells. It is a gateway which helps managers and employees, i.e. how to earn money
and accomplish market goals or objectives. Along with this, entrepreneurs create business plan to
lead at marketplace and remain successful. Following is defined various stages involved in
business plan of Southern Business technologies, Ltd -
Company Description - Southern Business Technologies Limited is an active company
incorporated on 15 November 2001 with the registered office located in Basingstoke, Hampshire.
Southern Business Technologies Limited has been running for 16 years 8 months. Its a macro
size company by having less than 10 employees.
Products and service of the company - The provision of communication services (call
charges, broadband, mobile solutions) and the supply, installation and service of telephone
systems. SBT Ltd., also create hardware and software applications for its clients thus to provide
them more flexibility in communication process. As due to high competition in markets, the firm
is focusing on creating new products by implementing more innovation in them; it leads to gain
high profit margins and sales revenues (Todes, 2012).
Mission & Vision – The vision statement of Souther business technologies is to offer
attractive products, technology, service,culture and spirit as these are plenty of unique offerings
which are revered around the world. Apart from this, the main objective of the firm is improve
the quality of its offerings and design them in more attractive way so as to gain competitive
position over the market.
Situational analysis – After identifying the vision and mission statement of Southern
business technologies marketers need to analyse market situations thus to determine which
environmental components can hinder its market position in future. Although situational analysis
can be done through evaluating strength and opportunities of the company.
Strength Opportunities
Southern business technologies Ltd., has a
good market presence over customers as the
firm provides cheap rates telecom services to
Emerging into new markets would be great
opportunity for small business.
Government support in running of SMEs; it
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large corporation thus make better
communication for them.
The firm is focused on providing regular
training and development to its employees as
they can perform in better manner; well trained
and qualified staff members enables to give
higher productivity (Valler, Phelps and Wood,
2012).
Products and services of SBT Ltd., are always
based upon new technologies and maintain
their quality as well; it helps in attaining and
retaining people for long term period.
also finance to entrepreneurs for smoothly
running of business activities.
Online dealings help in raising sales.
SBT Ltd., is also trying to increase it functional
area in other fields also.
Identification of financial availability – In this stage, managers of SBT Ltd., focus on
determining its financial capacity thus to decide how much amount is going to be spend in
various business activities. Sufficient availability of funds is also known a most important
strength of an association which makes them able to bear all future risks and uncertainties.
Below is mentioned cash flow statement of the company hence to recognise cash inflow and
outflow -
[Southern Business Technologies Ltd]
Cash Flow Statement
For the Year Ending 31/12/2017
Cash at Beginning of Year 22,500
Operations
Cash receipts from customers 4,25,875
Cash paid for
Inventory purchases (1,58,252)
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General operating and administrative expenses (10,658)
Wage expenses (1,05,852)
Interest 8,502
Income taxes 18,780
Net Cash Flow from Operations 1,78,395
Investing Activities
Cash receipts from
Sale of property and equipment 35,564
Collection of principal on loans
Sale of investment securities
Cash paid for
Purchase of property and equipment (45,821)
Making loans to other entities
Purchase of investment securities
Net Cash Flow from Investing Activities (10,257)
[42]
Financing Activities
Cash receipts from
Issuance of stock
Borrowing
Cash paid for
Repurchase of stock (treasury stock)
Repayment of loans (42,585)
Dividends (45,850)
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