UK SMEs: Building Success through Planning

Introduction

In the UK, 99% business is small and medium sized organisations, where the entrepreneurs try to set up the business efficiently in the market. The UK government is supportive to the small and medium sized business entrepreneurs where it is possible to develop the business firm by creating innovative planning (Cosenz, 2017). The business plan is helpful to generate new and creative ideas and for successful establishment of the organisation. It is effective here to develop the business plan and create new ides to arrange capital, develop operational activities and establish the firm efficiently.

Business idea

The business is to develop an online application and create and website of the organisation to provide quality products and services to the customers. It is mainly online business, where the online activities and e-commerce platform are effective for the business to target the right audiences and retain them for long run. The major products of the organisation are super market products including the variety of necessities of the people across the UK. The place chosen by the entrepreneur is the UK, where it is the aim of the business to retain the customers across the UK. The entrepreneur focuses on creating mobile application or promoting the company which is basically the online service giving company to serve the best quality products and efficient services to the customers. The entrepreneur also focuses on product diversification where availability of the products are mandatory, the major products offered through the mobile application are grocery products, clothing and accessories, furniture and home appliances, kitchen appliances, health and beauty products, and other necessary items in daily lives of the individuals. Hereby, strong product portfolio is the major strategy of the entrepreneur to establish the business which is mainly the online organisation to deliver high quality products and efficient services to the customers (Smith & Clegg, 2017). The company aims at developing the mobile application through best software program and latest technology, so that the customers will enjoy shopping activities and make their orders easily through one click option. The entrepreneur aims at creating the mobile application very simple with clear and concise information so that the people can understand it easily and place their orders properly by reviewing the available options in the company. The payment system will also be easy for the customers where the company must focus on protecting the customer’s data and improve trust and loyalty so that the consumers can make their payments safely. The entrepreneur focuses on targeting the customers, who love online shopping and e-commerce services for making their purchase decision. As per the business ideas, the entrepreneur also aims at creating the application innovatively by utilising creative software knowledge and skill and latest technology. For providing efficient services, the service portal will also be simple and appropriate, where the customers can contact the sales person and resolve their issues successfully. Hereby, the entrepreneur focuses on promotion the application in the retail market and attracts the audiences by pricing suitable services and chance to make effective purchase decision for the quality products. The entrepreneur also focused on starting the application as a discounted store, where the customers can purchase their products according to their needs and preferences at lower price.

Mission and vision of the business

Mission:

To help the next generation for making effective purchase decision according to their needs and personal preferences through the online activities and e-commerce system

Vision:

To gain high competitive market and be one of the best online retailer in the UK

Rationale of choosing the business

In the recent era of globalisation, the retail market is growing at a rapid rate, where the retail firms are operating across the globe efficiently through delivering their quality products and services. The retail market is flourishing across the UK, where the UK market is efficient place for the entrepreneur to set up the business. The UK government is supportive and directive where the government invest more in the start up business, where the entrepreneur is encouraged to show their innovation and creativity in the economy for better business management. The government is hereby cooperative in the UK and the entrepreneur has the option to set up the business efficiently with the help of the government. Hence, the place for conducting the business is UK, as well as the entrepreneur chooses retail business, as the demand of the customers for the retail products is also increasing over the years. The retail firms are serving the necessary goods and daily used items where the customers demand is rising at a rapid rate (Xi et al., 2018). Hence, the retail firm would be one of the effective business ideas, where the entrepreneur will be successful in near future. There is great rile of the technology in the retail operations, where the attest technological innovation enhances the activities in the retail market which further influence the entrepreneur to set up the innovative business to serve the customers in a creative way. On the other hand, the legal compliances and ethical code of conduct in the retail market are also efficient which support the entrepreneur to set up the business in an ethical manner which in turn provides a scope to the entrepreneur to secure future sustainable development (Cosenz, 2017).

Entrepreneurship ecosystem

Entrepreneurship ecosystem is the practice of developing new business ideas, creative strategic planning and decision making practice to establish the business efficiently. There are six factors of entrepreneurship ecosystem, which are policy, finance, marketing, supports, culture and human capital. These are the major factors which influence the entrepreneurs to manage the business activities and ensure proper establishment of the business. The entrepreneur in this regard focuses on human capital to develop the online business, were the employees are the major stakeholders to run the business. Providing monetary and non-monetary incentives to the employees is the major strategy to improve human capital and encourage the staff for successful establishment of the organisation (Eveleens, 2019). On the other hand, it is important to develop organisational culture to establish the online retail business. Wealth creating, entrepreneur’s social status as well as proper establishment of the organisational culture are mandatory to fulfil the entrepreneurship ecosystem.

Ecosystem implications, it is necessary to follow the government rules and legislations to establish the firm successfully. The entrepreneur focuses on developing proper leadership style, in order to manage the staff and run the business efficiently. The leadership style is important where the entrepreneur aims at supporting the staff and directing all the stakeholders properly to establish the business successfully. It is also necessary to develop proper support through establishing organisational infrastructure, implementing latest technology and hiring the software developer and skilled workforce who can handle the online business activities strategically (Smith & Clegg, 2017). For market capture, the entrepreneur aims at developing proper network of the business and target the right audiences in the retail market so that it would be possible to retain the customers in long run. The entrepreneur in this business tries to manage the network and develop the business by creating distribution chain and retaining the online suppliers who are efficient to manage the business activities and grab the market opportunities in long run.

Markets

B2B market growth

Development of the online business

Innovative ecommerce platform

Retail market expansion

Support mechanism

Collaborative working practice

IT framework and computerised system

Software development for the ecommerce website

Creativity and innovation in the ecommerce service activities

Funding and financing

Financing from shares

Business loans

Venture capital

Enterprise investment

Human capital

Talented workforce

Efficient technical team

Experienced staff members in the organisation

Education and training

Training courses

Cultural training program

Digital marketing courses

Online business training and development

Regulatory framework

Cloud based ecommerce system

General Data protection Act 2018

Intellectual property rights and copyright

Culture

Positive image of the entrepreneurs

Diversity management practice

Accepting all the cultures

Suitable organisational workplace

Transparency and accountability management

Competitive analysis

Through the competitive analysis, it is possible to identify the market structure and analyse the market for successful establishment of the firm. In this regard, Porter’s five forces model is effective to identify the competition in the market. As per the model, there are five forces which would be discussed further,

VRIO framework

Blue ocean strategy by the new ecommerce firm

Operational and staffing plan

Operational planning:

For operational planning of this business, the entrepreneur focuses on strengthening their supply chain, as it is necessary to manage the stock of the products and distributive it properly. As the business depends on online activities and e-commerce services, it is necessary to manage the suppliers and distributors for better customer’s management and maximise the values for all the consumers internationally. In this regard, the entrepreneur of this new business start up also aims at managing the production sites to develop quality products to meet the needs and preferences of the consumers. For operational activities, the entrepreneur tries to manage warehouse and improve inbound and outbound logistics successfully. In managing the warehouse for this ecommerce business, the entrepreneur aims at implement the Information and Communication Technology (ICT) as well as Enterprise resource planning (ERP) system, which is mainly integrated system software to improve efficiency of the organisational operations (Hatak & Snellman, 2017). Through developing the organisational infrastructure, warehouse development, proper management of the latest technology at the workplace such as ERP, it is possible for the entrepreneur of this new start up to manage the retail market activities and improve their operational efficiency in long run. Through strengthening the supply chain and distribution network the company will track the product orders and customers for successful delivery of the quality products. Apart from that, the ICT and the customer’s relationship management software will be able to manage the customers and create values for them in long run (Laine et al., 2019). On the other hand, the entrepreneur also aims at develop cloud computing database for organisational database management system, where it would be possible to manage the stakeholders and improve business activities efficiently. The organisational performance can also be managed well through the implementation of the latest technology at the workplace, which in turn provides an opportunity to the organisation to manage their operations and establish the brand successfully (Lam, Zhou & Tang, 2018).

Staffing planning:

It is necessary for the organisation to develop proper staffing strategic planning in order to strengthen their employee’s base who is the major stakeholders of the business. The Entrepreneur of this business is efficient to develop proper strategies to manage their diverse workforce in the organisation. The Entrepreneur develops employment rules and regulations and follows the industry standard for managing the strong employee base. Developing proper salary structure as per the different roles and responsibilities of the employee’s is another strategy of the entrepreneur through which it is possible to satisfy the staff in the business (Sozen & O’Neill, 2018). The entrepreneur tries to hire the technically skilled workforce, as the business is innovative and their needs knowledgeable staff which can handle the software application, business operations. The entrepreneur aims at selection process of the employees for effective staffing strategy and in this context, personal interview and personality test will be there to analyse the skill and abilities of the staff and hire them as per their intelligence (Lam, Zhou & Tang, 2018). Additionally, the Entrepreneur aims at providing performance related pay and incentives to encourage the staff. On the basis of the performance of the staff in the organisation, the entrepreneur focuses on providing them incentives and rewards for better management and retention of the experienced employee in the business. Apart from that, the entrepreneur will be able to develop proper organisational culture. The entrepreneur in this regard focuses on developing suitable culture so that it would be possible to give friendly atmosphere and safe workplace to the workers where the employees can perform with safety and security (Hartmann et al., 2016). The staff members will also be able to improve their performance with proper cooperation and communication with the Entrepreneur. On the other hand, for effective staffing, the entrepreneur will develop ethical code of conduct by managing integrity and respect all the staff, maintaining transparency and accountability in the business, safety and security of the employees as well as providing equal opportunity to the staff members at the organisation. These are the major ethical code of practice where the Entrepreneur aims at managing the employees and improving their performance in long run.

Proposed business model and strategy

The business model is necessary to develop further planning and in this regard the entrepreneur chooses online business model, B2C business, indicating business to customers. The organisation will serve the customers directly by developing the business and software application by utilising the e-commerce strategy. The entrepreneur is efficient to develop the online business by creating company’s own website as well as lunching the new mobile application, in the market. This is the major business model, of the organisation to set up the activities further. In this regard, the entrepreneur also focuses on business strategic planning of successful establishment, where the major strategies are marketing planning including product portfolio management, placing the products at the market as well as promotional strategy. For managing product portfolio of the brand, the entrepreneur will focus on product diversification strategy and manage a huge variety of products in the company which would be beneficial to target the customers and influence their purchase decision making behaviour (Burns, 2016). Apart from that, the company also focuses on setting lower price to gain competitive advantage in such an era of intense competition in the UK retail industry, where the customer’s values can be created by delivering them high quality products at competitive price. Hereby, the strategy of premium pricing strategy would also be effective to set up the innovative business sustainably in the market of the UK. In order to run the business efficiently, the entrepreneur aims at adopt cost leadership strategy apart from the products diversification planning, in order to reduce the cost of products and distribution of the products and services and generate profitability in long run. On the other hand, the entrepreneur also aims at placing and distributing the organisational quality products and services and in this regard green supply chain management and strengthening distribution network in the retail chain by retaining experienced suppliers and skilled distributors so that the products can be placed in the market sustainably (Wilson & Elliott, 2017). On the other hand, the entrepreneur is also efficient to develop proper promotional practice to set up the business efficiently. In this regard, mobile application development and creating the online website are the major strategic plan for promoting the company in the market. SEO content marketing is adopted to increase population and improve brand visibility. Apart from that the entrepreneur will be able to create social media advertisement to promote the online business. These are the major strategic planning to set up the business and establish the creative online organisation innovatively.

Business canvas model

Financial plans and projections

Required cash:

For successful set up of the business, it is necessary to manage cash. The cost of the set up is mandatory to analyse so that it is possible to arrange the capital for successful establishment of the business. As per the analysis, total cost of the business is £26500, where the entrepreneur of the business should arrange the cash. The major option of arranging the cash for this new business venture is raise venture capital, taking business loans and government funds. It would be possible to arrange government fund to for start up business firm, where the government of the UK invest in the economy for supporting the small and medium sized business to support the entrepreneurs for better management and successful establishment of the firm (Kolvereid, 2016). In this business, the entrepreneurs would be successful to raise capital through taking business loans from the banking institutions, utilising government fund for start up entrepreneurs for small sized business and raising sponsorship and venture capital.

Cash flow:

As per the cash flows projection, it is expected that over the years, the business will be able to improve their cash flows at an increasing rate. The business plan is effective to increase operating profit and net income which provides a scope to the firm to secure future sustainable development.

Sales projections:

As per the business plan and the projected sales volume, it is expected to raise the sales of the company due to quality products and services. The entrepreneurship plan for this business is effective and it is expected that the organisational would be successful to generate profitability by enhancing their sales volume in the market. In the first year, it is expected to rise 3% and after that it would 6% and 10% in the upcoming second and third years, where sales volume will be increasing due to strong customer’s retention.

Breakeven point:

It is expected to set the price for the products of the organisation at £100. In order to reach the breakeven point, the organisation needs to raise profit up to 26500, which is actually the cost of whole operations to set up the business. In this context, for the organisation, it is necessary to sell 265 units of products in the market to reach the breakeven point, so that there would be no loss for the business. If the organisation aims at generating profitability, it is necessary to retain more customers and sell more products in the market above 265 units, so that the firm would be sustainable in the market and secure future development.

Reference List

Burns, P., 2016. Entrepreneurship and small business. London: Palgrave Macmillan Limited.

Cosenz, F., 2017. Supporting start-up business model design through system dynamics modelling. Management Decision.

Eveleens, C.P., 2019. Interfering with innovative entrepreneurship: How business incubation impacts the performance of start-ups (Doctoral dissertation, Universiteit Utrecht).

Hartmann, P.M., Zaki, M., Feldmann, N. & Neely, A., 2016. Capturing value from big data–a taxonomy of data-driven business models used by start-up firms. International Journal of Operations & Production Management.

Hatak, I. & Snellman, K., 2017. The influence of anticipated regret on business start-up behaviour. International small business journal, 35(3), pp.349-360.

Kolvereid, L., 2016. Preference for self-employment: Prediction of new business start-up intentions and efforts. The International Journal of Entrepreneurship and Innovation, 17(2), pp.100-109.

Laine, K., Tynjälä, P., Eteläpelto, A. & Hämäläinen, R., 2019. Students’ self-reported learning outcomes after a business start-up education program. International Journal of Training Research, 17(2), pp.98-115.

Sozen, E. & O’Neill, M., 2018. An exploration of the motivations driving new business start-up in the united states craft brewing industry. In Craft Beverages and Tourism, Volume 2 (pp. 195-212). Palgrave Macmillan, Cham.

Wilson, J. & Elliott, K., 2017. Relationships Matter: examining the effectiveness of building relationship quality when supporting social entrepreneurs in business start-up. In 9th International Social Innovation Research Conference (ISIRC). Newcastle University.

Xi, G., Block, J., Lasch, F., Robert, F. & Thurik, R., 2018. Work experience from paid employment and entry mode to entrepreneurship: business takeover versus new venture start-up. Revue de lEntrepreneuriat, 17(2), pp.91-112.