Beruflich Dokumente
Kultur Dokumente
1
Table of Contents
Introduction ..................................................................................................................................... 3
LO1 Analyze the key considerations SMEs should consider when evaluating growth
opportunities. .................................................................................................................................. 4
Analysis of the key consideration involved in the growth opportunities and its justification within
the organizational context. (P1) ...................................................................................................... 4
Evaluation of opportunities for growth of the business using Ansoff’s growth vector matrix (P2)
....................................................................................................................................................... 10
LO2: Assess the various methods through which organizations access funding and when to use
different types of funding.............................................................................................................. 13
P3: Assessment of the potential funding sources available to the business and discussing the
drawbacks and benefits of each source ......................................................................................... 13
LO3: Develop a business plan (including financials) and communicate how you intend scaling
up a business ................................................................................................................................. 17
P4: Designing of a business plan that includes the business growth using the strategic objectives
and financial information .............................................................................................................. 17
LO4: Assess the various ways a small business owner can exit the business and the implications
of each option. ............................................................................................................................... 27
P5: Assessment of succession or exit options for the small business while explaining the
drawbacks and benefits of each of the available options .............................................................. 27
Conclusion .................................................................................................................................... 32
References ..................................................................................................................................... 33
2
Introduction
factors. The growth of the SMEindustry is mainly dependent on the certain environmental
conditions as well as economic factors input. This report mainly focuses on the growth factors
involved to run the SME business successfully. A business firm namely Rebellion Developments
has been considered into account to analyze the market growth. The development and growth of
the entrepreneurship business consider the analysis of the macro and micro factors like the
greater mobility of capitals, economic and financial factors limited to the liabilities, tax
incentives and low taxes, good banking with easyavailability of the credits, lower labour costs,
political biases and many others. These factors will be discussed ina very brief manner such that
the company will be able to focuson the main areas of its development.
3
LO1 Analyze the key considerations SMEs should consider when evaluating growth
opportunities.
Analysis of the key consideration involved in the growth opportunities and its justification
Gaining competitiveadvantageis considered as a key foundation for the business growth. This
includes an individualfirm’s capabilities, core competencies and available and existing resources.
The main routes of growth options involved in the business process have been discussed in the
below framework.
Strengths Weaknesses
The well establishedgame designer company Not much effective to adopt new technology
established in the UKbyhaving customers more with immediate effect
than 10 million
Having a strong reputation in Market
Partnership in the value chain acts as potential
franchising for expanding the business across
the globe.
Opportunities Threats
Exploiting the digital platform and technology The threat of tough competition from Rubicon
helps in generating desired growth also Genomics and Swift Biosciences
expands the network.
Collaboration also helps in achieving desired
business growth.
Vertical and horizontal integration will make
the organization to gain support from the
investors.
Table 1: SWOT of Rebellion Developments
4
(Source: Created by the Researcher)
Above SWOT analysis justifies that organisational growth mainly dependable on its internal
environment.
Competitive advantage can be linked with the growth opportunities while analyzing the business
firms external and internal environment analysis. Toanalyze the Rebellion Developments
Political Factor:
Rebellion developments are mainly affected by the UK's political decisions. The fluctuation in
the government and the changing tax rates are politically affecting factors for the organization.
Economic Factor:
Debt and equity are considered as the two major sources of financing for the business.
Government grants to the fiancé also considered as one of the aspects of business funding option.
An incentive available in order to locate particular communities and to encourage the activities
of the particular industry is another available option. From the above combination of source
helps the Rebellion Developments Limited’s business firm to gain funds in case of emergency.
The GDP growth in the company is also one of the factors impacting the growth of the business.
Social Factor:
Socio-cultural factors also find outs the customer’s interests in the particular geographic areas.
The newly introduced and adapted practices must suit the new geographic market and product.
5
Larger organizations like Rebellion Developments Limited’s can also choose another business
entirely to acquire and achieve diversification. In order to introduce the diversification for
chain.
Technology Factor:
Technology change and growth of mobile devices and the internethave brought changes in the
generated revenue of Rebellion Developments Limited’s. Technical and economic factors also
state the organization's capabilities and available resource that in turn raises the organizational
performance.
Legal Factors:
This organizationhas been registered in the UK company act 2006.As Rebellion Developments
Limited’s operates globally, it is utmost important for an organization to look after the political
and legal factors involved in respective countries. It states the government’s intervention in the
economy.
Environmental factors:
Rebellion Developments Limited’s is so cautious about the environmentand also certified under
Analyzing these above factors will help the organization to bring innovation in production
marketing procedures.
6
Figure 1: PESTLEAnalysis
In order toachieve the core competencies, the generic strategy namely porter’sthe five-force
model will be considered into account. Below figure depicts some of the key basic areas
involved in the model to achieve the competitive advantage. Rebellion Developments Limited’s
needs to follow all of the strategies in order to achieve business growth compared to other
competitors.
7
Figure 2: Porters five force model
Threat of buyers has been seen due to raising of competitors in the existing and new market.
Bargaining power of suppliers is the major threat for the organization. This, in turn,impacts the
In the existing market threat of new entrants is a major affecting factor for business growth.
8
The threat of substitute products
Substitution of products and services by the new entrants is another threat for the organization.
Rivalry Firms:
In the UK, gaming companies are grooming in a faster rate. In order to compete with these
growing companies, the Rebellion needs to update the technology and its marketingstrategy.
Competitive advantage:
In order to increase the market share, the business firm ofRebellion Developments Limited must
attract the new customers into business compared to its competitors. The existing customers of
the companies are the school going children’s and the teenagers. The potential investors can
fulfil the extra funding needs of the organisation in order to produce more gaming devices.
Utilising this opportunity will make the business firm to generate desired revenue for the
organisation.
Growth options:
In order to achieve the business objective successfully the Rebellion Developments Limited’s
needs to bring innovation tothe gaming platforms. Smartphone needs to be chosen as a platform
to run the games,andAndroid enabled needs to be givenpriority. Online games are needed to be
soldata reasonable price such that more customers will be taken under the business. As the
purchase of the products rises,it will drag more investors into the business. Thrilling children’s
fictions and horrors books are more sold in all areas of the globe. The Rebellion Developments
Limited needs to produce more volumes inthe market. In the next two months of the time, more
volumes of books and games need to be produced using the existing funds. It is highly
9
recommended for the business firm to utilize the overdraft facility arrangements available to the
bank. It has been seen that the company has an overdraft facility arrangements of 20 million
pounds in its account. This amount has never been utilised previously, hence it is highly
recommended for the company to utilise it right now for expansion of business growth.
Collaboration:
Diversification needs to bring in the product designing based on the consumer’s preferences
(Engelet al. 2017). Though there are, risks exist in the diversification process, while adopting the
costs carefully will deliver the desired benefits. The business can be expanded while selecting
the options like joint ventures, partnerships and acquisition and merger. This is the organisation
can follow one of the best possible marketing strategiesto create more shared decisions. Possible
management can be established through the process of partnership. Resolving staff issues can be
one of the clear advantage factors in the joint venture process. Successful Corporation will
deliver more resources, large skills, shares managerial loads and enhances the bigger pool of
contacts.
Evaluation of opportunities for growth of the business using Ansoff’s growth vector
matrix(P2)
In the case of running a business or expanding, it on globally the options like is best returns from
the considerable investments will be considered into account. In this regard for the business
name, Rebellion Developments Limited’s development and growth the Ansoff matrix
strategywill be analyzed. As per the comment of Kim Moore (2018), Ansoff matrix is a great
tool that helps in determining the business growth strategy,and it is known as a market/product
grid.This tool shows four of the growth options while matching up the new and existing products
10
with the new or existing marketing plotting it in the matrix. This matrix also helps in
highlighting the associated risks involved in the business opportunities. Ansoff matrix is can also
define as a marketing tool that examines the existing markets and products of the organization
and also shows the products that need to be entered into the current market based on its current
trend. The growth strategies of Ansoff matrix Strategy tool has been classified into its four main
categories that are illustrated below and depicted in the shown picture.
Market penetration
Based on the market penetration, the Rebellion Developments Limited has needed to sell more of
its products to its existing customers. In order to do this business needs to find some of the
innovation strategies to increase the customer's loyalty as well need to focus on growing the
customer lifetime values. The order process for the Rebellion Developments Limited’s can be
11
improved while making it easier for the customers while extending the business hours and also
making some of the adjustments to improve the offerings via long-term appeals.
Market development
attract new customers towards the existing products. New customers need to be identifiedby
geographic locations and are based on the entirely new demographic areas. New campaigns need
to be established such that different sales channels will attract all categoriesof customers.
Product development
Product development is also one of the main tasks involved in the business growth. Bringing new
variations and creating new products for the existing and new customers will enhance the
business growth. It is very important for Rebellion Developments Limited’s to look after the
aesthetic appeal and improvement of the products in all possible ways. As stated byNason and
Diversification
Diversification strategy considers the highest risk strategy,and that involves selling new products
to the new markets. It is very important for Rebellion Developments Limited is to hire a good
strategic manager and marketing consultant to look after the diversification move. Dmitrievaet
al.(2017) stated that diversification would work well in case the market is already well
12
LO2: Assess the various methods through which organizations access funding and when to
P3: Assessment of the potential funding sources available to the business and discussing the
Financing is an important factor invested in the business to expand it or to establish the new
business (Cohenand Munshi, 2017). There are several sources can be available to consider while
looking after the start-up finance. Whetherthe organisation has opted for the angel investor, bank
loan, business incubator or government grant, each of the available funding sources has its
advantages and drawbacks. These factors certainly evaluate the business performance. Below
typical sources of funding are illustrated with respective drawbacks and advantages.
I. Venture capital
Venture capitalists are the investors those who put a considerable amount of money in the
exchange of equity in the business. They get returns when the running business firm acquired by
another company or goes to the public. A venture capitalist is all about generating a huge amount
of money and only invests in such businesses that have potential good returns from
theinvestments (Clarket al. 2017). Venture capital also helps the technology-driven business as if
Rebellion Developments Limited has to raise the fund. Venture capitalists help in case of
carrying out the higher risk projects through taking charge of equity position (Pesonen, 2017).
They focus on major interventions and needs a large amount of financing in order to establish in
the market.Venture capitalists offer mentorship and expertise to developthe business. They also
provide the potential amount of funding.Venture capital funding also gives the business firm
immediate credibility and also opens the door for the wide network of future partners and
13
investors.A large chunk of business will be needed to give up due to a significant amount of
provided funding.
Bank loans are consideredas popular sources of funding for all circumstances. In order
toadoptthe bank loan, it is utmost important to go for available options like the rate of
interests.This is one of the easily available funding sources for all kind of business.Based on
thecompanies need several funding options are available like, the funding options and the
process is very quick in nature in case the organisation meets the criteria. There is no need of
giving up the business control in this funding source. A lot of documentationis required. This
process is time-consuming and much tiring. The money needs to be paid back to the bank
whether the business is failed or successfuland failing of repayment will lead to loss of the
assets.
This mainly involves funding from the devoted government administrations in order to assist the
business to be successful. It helps the basic relationship between the borrowers and lenders.
Increased chances of obtaining any banks loan in case these loansare managed properly. Strictly
Angel investors are thepersonnel who provide funding in exchange for the equity shares of the
business. They offer valuable guidance and advice as they are into the same industry. There are
flexible business terms. To some extent, there is a force to give up the control over the business
14
V. Crowdfunding
Crowdfunding is a process of taking a smallnumber of capitals from the set of people via the
internet source. Thiscan be donethrough word out the business using social platform with the
goal to attractinvestors that are more new. There is a potential for expanding the business
througha pool of investors who can raise funds. It requires dedication and time before realising
the results.
Payback method
Following this process, the company has chosen the time frame of two years in order to gain the
invested original amount. The cash flow statement has been recoveredwithin the given period.
Net present value method has been used to determine the profitability of the organization.While
summing the capital costs, annual cash flow and initial investment, this is derived.
15
(Stachowiak-Kudłaand Kudła, 2017)
Financial needs of the business varyby the size and type of the business firm. Processing of the
business of Rebellion Developments Limited’s isusuallya capital incentive in nature that requires
a large amount of capital to run the firm.Retail business generally requires less capital to run the
business firm (Stachowiak-Kudłaand Kudła, 2017). Based on the organisational context venture
capital and business incubators are considered as the potential source of funding for the
revitalisation, job creation, sharing and hosting ofthe services.Incubators also invite future
business operations and share the premises of other fledgeling companies. Logistical,
receives this kind of support will operate within the sectors of industrial technology, multimedia
16
LO3: Develop a business plan (including financials) and communicate how you intend
scaling up a business
P4: Designing of a business plan that includes the business growth using the strategic
Executive summary
Rebellion Developments Limited is one of the most popular video game developing companies
in British (rebellion.com, 2018). It releasesvarious series of multiple games and also published
comic books. It serves its products all over the worldwide. 300 employees are workingunder the
company and subsidiaries of the companies include rebellion Liverpool, Abaddon books,
To measure the business growth while looking after the business market share, turnover, sales
To focus on the business growth while identifying the possible opportunities for market growth
17
Rebellion Developments Limited is one of the most popular video game developing companies
in British (rebellion.com, 2018). It releases various series of multiple games and also published
300 employees are working under the company,anda subsidiary of the companies includes
Rebellion Developments Limited has a high sales volume and the narrow margin of stocks. As
stated by Klaggeet al.(2017), a combination of profits and sales in a balanced way will measure
the business growth. Cash flowis neededduringthe phase of designinga business plan. Timing is
one of the critical factors involved in the business growth. Rebellion Developments Limited firm
must reconsider the production process timing as compared withthe orders. Additional staffing,
outsourcing certain tasks, refining equipment and production process are considered into account
for making the business growth. It is utmost important for the Rebellion Developments Limited
firm to increase its marketing share for achievingthe desired growth of the firm.
Start-up expenses
Others £1000
18
Total start-up expenses £56000
Start-up expenses
Cash £70000
(Source: Self-developed)
Before designing the business plan, it is utmost important to consolidate the existing
performance of the running business firm. It is also important to reconsider the existing customer
Various kind of innovative games is needed to be introduced to the market with running 3D and
4D technologies as it attracts more children’s. Rebellion Developments Limited has very good
credit ratings. This, in turn, helps the organisation to gain more economic support from the end
Sourcing
19
Marketing’s strategy of Rebellion Developments Limited needs to be strengthening. Marketing
campaigns and online marketing helps needs to be taken to promote the designed products.
Customers and market research helps the organisation to found out the potential environment
4. Situational analysis:
Political factor:
In order to make the business growth, it is utmost important for an organization to a look after
the untapped demand for the products of the customers. It is also important for an organization to
look after the business can be able to support these demands of the customers.
Economic factors:
20
In the UKtax burdens are much higher,and the banks are providing much higher interest loans.
As a medium scale industry, it is important for the organization to aware of the interest rates
Technological factors:
As the company is into technology-based game developing in nature, it is very important for it
In the recent year, Rebellion technology limited has gained revenue of 12 million and also stood
as first game developer among its revelries. This company has a competitive advantage and also
has promised developments in the NGS analysis. The involved software’s are updated and
5. Strategic objectives
To Identify all necessary actions in order to optimise the value of the running business
To Structure the deals in order to minimise the tax payables on the sales
To Make agree on the process and the expected timing for its sale
6.1 positioning
21
In order toachievepositioning in the global and local market more customers have planned to
attract towards the latest designing of games. This company has well established as a gaming
Pricing
In case of pricing strategy, this company offers a reasonable price for each gaming application
and devices.
7. Distribution
At present this company has mainly operated in the European countries. This company is also
Promotion
Social media like facebook, twitter and E-commerce technology has been used for product and
service promotion.
8. Financial plan:
22
8.2) Personnel plan:
23
8.5: Cash flow:
24
25
8.6 Balance sheet:
26
LO4: Assess the various ways a small business owner can exit the business and the
P5: Assessment of succession or exit options for the small business while explaining the
The exit strategy is sucha kind of strategy that is implemented in the small businesses. There are
variouskinds of exit strategies available to the small business owners are a liquidation, selling the
business, family succession, bankruptcy and putting the company to the public. Selection of exit
strategy is very important as it can affect the investors and value ofthe owners. Possible exit
Among theall-possiblestrategies,the best exit strategy is that one best matches with the small
27
I. Liquidation
This strategyis known as sell all the assets or closes up the business firm. Forthe small business
that is mainly depending on the single individual performance, liquidation is the only options. In
this situation,sometimescan be spent for retooled the business such that it couldbe operated with
other personnel. The firm will be made available to someone who can buy it.
Simplicity
The only money available from the liquidity sales is from the assets disposal like land,
Second-hand business assets values for the invested items will be very low.
In this strategy, the owners of the business extract all kind of the profits out of the existing
business overtime before closing and selling the business. Before winding the business large
Cash withdrawal can be maximised on an ongoing basis for the personal use.
Profit extraction over time reduces the growth potential as well as sales value
The dream of the small business owners is to ensure the family gets living ensures.
28
The family successors can do smooth transitions
Family members may not possessthe same skills to run the business firm successfully.
Stakeholders ofthe organisation like managers or current employees are willing to buy the
business.
Long-term buyouts arranged by the employees can increase the loyaltyand also motivates
Employee-owner may not be the suitable candidate to take over the business
Selling the business to the open market is one of themost followed business exit strategy. At any
certain point of time when the owners areready, to retire can put the business for sales at a
particular price.
Profitable business gets attracted soon and sold atan attractive price
Goodwill and assets are incorporated with the business value for sales while maximising
Finding the buyers as per the owner demand is very difficultand follows the longer
29
Business can be very difficult to value atthe open business and selling price
cangetlowered as expected.
VI: bankruptcy
Bankruptcy is one of the toughest conditions for the small business. It is an extreme
Selling eth business at this point will reduce further fund loss
It is very tough to find the buyers or investors after the company filed for bankruptcy.
Theowners of the business need to know with what kind of property an individual needs to exit
from the business. Theowner walks away with the management control, money or with the
intellectual property. Passing thebusiness to thesuccessorsare having the greatest advantage for
the business firm as there is no such major changes will be drawn in the operations and
investments (Wanget al. 2017). Thesuccessors are the family members,andit reduces the third
party involvement. It also gives involvement of the owners in case of requirements as an advisor.
It gives proper involvement in influencingthebusiness. Selling the business to the owners is also
another best possible method of exit strategy a company can go through. However, there will be
no relation with the owners once it is sold to the employs or managerswiththe owner (Sunand
Govind, 2017). It also causes thrive forthe employees for an organisation. These sales of the
Recommendation
30
The following steps are recommended to follow while implementing the successful exit strategy
31
Conclusion
This report mainly focuses on the development and growth of the SME business strategies.
Several techniques of growth opportunities and appraisal options havebeen introduced for the
business growth via making a collaboration. This study also analysed various sources of
investmentsthatattract the SMEinvestors. Various kinds of exit options and their implementation
techniques also studied. This study concludes that every business needs to make informed
decisions whilechoosingthe routes of growth. Potential risks andthe rewards involved in the
growth havebeen described in very brief manner. Ansoff growth vector is one of the best
possible tool used to make the businessgrowth of the chosen organisation namely Rebellion
Developments Limited.
32
References
Clark, R., Reed, J. and Sunderland, T.C.H., 2017. Bridging funding gaps for climate and
Cohen, S.K. and Munshi, N.V., 2017. Innovation search dynamics in new domains: an
Dmitrieva, D., Ilinova, A. and Kraslawski, A., 2017. Strategic management of the potash
Engel, A., Browning, T.R. and Reich, Y., 2017. Designing products for adaptability: insights
Kim Moore (2018) Use the Ansoff Matrix for Evaluating Growth Opportunities [accessed from
https://www.kgmoore.co.uk/strategy-tools-use-the-ansoff-matrix-for-evaluating-growth-
Klagge, B., Martin, R. and Sunley, P., 2017. The spatial structure of the financial system and the
Nason, R.S. and Wiklund, J., 2018. An assessment of resource-based theorizing on firm growth
33
Pesonen, M., 2017.Impacts of public funding on firm performance-A case study on the sources
Song, J., Sun, Y. and Jin, L., 2017. PESTEL analysis of the development of the waste-to-energy
Stachowiak-Kudła, M. and Kudła, J., 2017. Financial regulations and the diversification of
Sun, W. and Govind, R., 2017. Geographic diversification, product diversification, and firm cash
flow volatility: the moderating effect of firm dynamic capability. Journal of Strategic Marketing,
pp.1-22.
Vogl, J.D., 2018. Implementing Product Diversification Strategies for Small and Medium Retail
Businesses' Sustainability.
Wang, Z., Fung, R.Y., Li, Y.L. and Pu, Y., 2017. An integrated decision-making approach for
designing and selecting product concepts based on QFD and cumulative prospect
34