Small business enterprise of across the world has gain priority in many countries of the world. The report focuses on the growth of small medium enterprises in United Kingdom. A small medium enterprise of United Kingdom dealing with retail is selected for the report. The report is focused on providing solutions to the retail enterprise of the country in terms of business development. The company has approached to a business consultant firm to help them in improving their strategy of business in the market. In the competitive business world, it is seen that the small medium enterprises are developing. Government of United Kingdom has spent £11.4 billion to this group because the government want to work these companies under central government contracts (Volery et al. 2015). It is seen that the small business enterprises of United Kingdom is contributing a huge section of contribution of economy to the country. The clothing retail company in this case is facing completion in the competitive market. It is the reason of seeking help from the business consultant. Research has illustrated that the small medium enterprises of United Kingdom has hardly made any loss to their business. Almost 75% of the businesses have made profit in their business. 15% of them are at their breakeven point while the rest has made loss in their business (Sandada et al. 2014). It can be seen that the majority of the company has gain success in developing their business in the field of small medium enterprise. The report will focus on the strategy formation of the clothing retail of United Kingdom with detailed description. The validity of the new proposed strategy is also described along with the contingency action plan that will cover the weakness of the company as well as the weak areas of the proposed strategy.
The retail company chosen for the assignment is a small business enterprise of clothing retail. The company has one branch in the city of London. There are 10 employees working in the company. Among them, 4 employees are present in the retail stores, while the rest six are engaged in the back end works of distribution of the products. However, the enterprise aims in completing the breakeven cycle within the six months of the financial year. Apart from that, it is also planning to increase its customer base by providing excellent customer service. The name of the fashion apparel company is Fashionista. It is located in the Selfridge area of London. The address of the retail outlet is Selfridges, 300 Oxford St, Marylebone, London.
The clothing retail company chosen for the study is located at London. The retail outlet is based on ladies’ garments as well as men’s garments. The business has a single outlet in the city. There are numerous strengths of the medium retail store. They are as follows:
Apart from strengths, there are weaknesses also that hinder the sales of the company. The weaknesses are:
The performance of the apparel business is measured through the performance indicator of the Balanced Scorecard. The indicator of Balanced Scorecard is defined as the management system and strategic plan system that is used to align the activities of the business along with the mission and vision statement of the company. It is a holistic approach that covers each and every aspect of the organization. The balanced scorecard counts every aspect in a way so that it can calculate the efficiency of the expertise of the department of operation of the company (Cameron and Green 2015). The apparel company when implement the balanced scorecard in the part of strategic management, then the department must have a clear understanding of the mission statement as well as the strategic planning. Apart from these aspects, there are few other aspects that are to be taken into considerations such as financial status of the company, operating structure and operating procedure of the organization, degree of expertise of the workers and the level of customer satisfaction (Awad et al. 2013). The balanced scorecard after implementation will result in some areas such as motivated and trained employees, improved and efficient processes, monitored progress, increased financial leverage, improved customer satisfaction, enhanced information systems, improved return on investment, etc.
Implementation of a balanced scorecard will provide results to four aspects such as financial, internal business process, customer and learning & growth. These factors are dependent with one another and the areas of the improvement are dependent with the four factors. The results of the balanced scorecard of the clothing retail are as follows:
Above are the reasons that are pointed out as the weakness of the clothing retail company that are discussed using the strategic planning model of Balanced Scorecard. The recommendations of the identified weaknesses will be provided in a way so that they can be implemented without facing any problem in the budget of the company.
A team in the supply chain management department should be recruited so that the stock of the store will remain intact and up to date (Goetsch and Davis 2014). The visual merchandising team should be monitored so that the visual merchandising of the store becomes attractive to attract more customers to the store. Training and development department should be more focused to the results of the Balanced Scorecard model. It illustrates that the company will be more focused to their gaps that are caused between the employees and the customers. Mitigation of the gap is very necessary to increase the sale as well as the profitability of the company (Vakola et al. 2013). The business model of the company should be changed to incorporate the action plans into it.
Digital promotion is the new trend of promotion of the brands in order to target maximum number of customers within a shorter interval of time. The digital marketers will be recruited in order to promote the company in the online portal. The company can use the promotion in social media websites and the Google Adwords.
The clothing retail has to change their promotional strategies in order to compete with other companies in the market (Hayes 2014). The most important weakness of the company is to not having online presence. The customer segment of the company is young people who are mostly tech savvy and use internet for any types of queries related to fashion. The trend of fashion in other countries enters into other country first through internet. Apart from that, if the customers do not have any idea about the existence the clothing retail company then there will be no increase in the sales. It can be done not only by developing websites but also develops its presence in the social media channels like Facebook, YouTube, Instagram, Twitter, Google Plus and Flickr.
It is seen by the experts of the business consultants that the company is using old approaches of business development. The existing business performance of the company must be increased so that the apparel company can sustain their business in the competitive business market. The current business model of the organization is not capable enough to generate revenue as well as to attract customers from the market. As the company is located in a prime location of London, hence the conversion of the visitors of the stores into loyal customers is high. The current performance of the business could be maintained if the company pays more attention to the financial returns as well as to the operations that is heading the supply chain management of the company (De Neufville et al. 2013).
The senior management of the team must put emphasis on the overall performance of the teams that are working for maintaining all the operations in the store as well as maintaining employee relations. Human resource department must have to implement the formulated strategies as per the organizational goals and departmental goals. Apart from that, it can be said that the government of United Kingdom is supporting the growth of the small medium enterprises of the country by providing them funds. Governmental aid and contracts will help the company to flourish their business (Oreg et al. 2013).
As it is discussed earlier that there are many areas the company has to develop in order to sustain its profitability and reputation of the brand image in the market. The apparel company has to develop their training and development area along with recruitment of teams in the field of supply chain management. The company can expand its branches after few months if the revenue increases up to a certain level. A specialized person can be recruited who will look after the visual merchandising part of the store (Carter et al. 2013). The strategic management department of the company must be developed so that they can implement the strategies that are recommended in order to develop their position in the market. The clothing retail company has to develop its internal trainers and strategic department so that they can change their pattern of business as well as the new strategies to increase the sales performance.
In terms of Ansoff Matrix, product development can be implemented in terms of adding new products in the existing markets. New products will include clothes of latest fashion along with accessories that will suit the status of the youngsters of the age. It will definitely attract new customers if the prices of the items are kept at reasonable rate. However, the company also penetrate into the existing markets by increasing the number of stores in other areas of London. In this case, market penetration strategy will be adopted in the existing markets.
Every business has its particular goals and objectives in order to make business in the marketplace. Apart from that, there are mission and vision objectives of the company that illustrates about the aim of the company towards its customers and community. The mission statement of the company explains that the apart from profit it has a responsibility towards people and community. The current business plans of the apparel company is focused to achieve the expected profit that is set for achieving the business target as well as the departmental goals. The company is focused to increase its sales by 10% in the coming three months (Cullen et al. 2014). On analysing the business plan, the objectives are as follows:
These current objectives of the business plan are not sufficient to meet the requirements of the modern trends of the clothing industry. It needs to be revised that will be discussed in the next paragraph.
Business plan template
Mission statement: To provide the customers best quality latest fashion apparels and accessories within a reasonable price by satisfying their demands.
Company history: It is a five years old small business enterprise of apparels.
Company Location: London.
Company Name: Fashionista
Products: Apparels of ladies, men and children along with different types of accessories
Important features of the product: Products will be of latest fashion but within affordable price.
Customer service: It would be excellent as retail industry is not only based on the products but also due to excellent customer service and follow up.
Market Analysis: It is a fast changing industry in the patterns of the design of the apparels and accessories.
Target Market: Mostly the young segment of customers of age group 25 to 35 years
Key to success: The clothing retail company have to increase its products in terms of fashion trends. Apart from that, training will be provided to the employees for convincing the customers for impulse buying of accessories and other apparel products.
It is described earlier that the current business plan of the apparel company is not meeting the objectives and goals of the company as well as the market requirements. Hence, it needs to be changed in certain fields along with the implementation of new strategies into it. The revised business plan of the company is to be formulated in a way so that it can accomplish with the new targets and goals set for the company in the coming years. Apart from changing the current business plan of the apparel company, the mission is also need to be changed in order to set a new dimension in terms of business development as well as profitability (Hulbert et al. 2013). The goals of the new business plan are described in the following:
The revised plan needs to be implemented by the strategic management department of the company. The business plan is formulated by keeping in track with the laws and regulations of the country along with the demands of the markets and customers. It is not enough to formulate the strategies. The most vital part is the implementation part. It is a part of the change management (Petrou et al. 2016). The change management strategies are to be incorporated in the action plan. The action plan is described in the following.
The first stage of the action plan is details of the change. It will incorporate the changed approach along with the particularities of the change. The second stage of the action plan is implementation of change. It includes implementation of the proposed strategy along with release strategy. The second stage is the most important stage of the action plan that incorporates training plan, release plan, resistance to the revised plan, readiness towards employee readiness plan, review strategy and a communication plan (Blackburn et al. 2013). The last stage of the action plan is the appraisal of the new changed strategy. The action plan will help the senior management department of the company to incorporate the revised objectives in the business plan of the company.
|
Objective |
Target of completion |
Progress |
|
Details of business plan change |
Within 2 weeks |
Progress will be checked so that no areas of development are left untouched |
|
Implementation of the new business plan |
Within 1 month |
Monitoring the changes and comparing with previous profitability of the company along with earlier promotional strategies. |
|
Appraisal of the changed digital marketing strategy |
Within 2 months |
Resistance of the employees of marketing and operations are removed completely for proper implementation. New team of digital marketing is to be recruited. |
Impact of Change Management
There will be changes in the strategic management of the company as well as the mindset of the employees (marketing and operational) associated with it. The changes include errors caused by the personnel who will be supervising the result of the action plan. The employees will find difficulties in adopting the new strategies as they are accustomed with the old patterns of the business. Adjustments with the new business model would require sometime in order to achieve success in the new plan. Apparently, during the time of implementation, the company may find some difficulties in controlling the operational procedures of the departments that are facing changes in their working procedures. Resistance of the workers is one of the common problems faced by every company while imposing new communication and business strategies (Hulbert et al. 2013). Apart from that, many employees are supporting the new strategies. The positive aspects of the strategy are employees are finding positive impact in the business in the long run. The profitability of the apparel company increased as the sales of different apparels as well as accessories. Apart from that, the employees on receiving training towards skills of excellent customer service are feeling happy to serve the customers in the stores. The visual merchandising of the store attracts huge customer base from now onwards (Al?Najjar 2015).
The theoretical concept of Kotter’s eight-step change management model is to be applied by the apparel company to manage the changes in the business plan. The implementation of the theory is consisted of eight parts such as:
The improvements of the business performance can be measured by implementing the tool of Key Performance Indicators. The tool is used to measure the performance against the targets or to the benchmarks in order to monitor the trends. Key Performance indicators will help the senior management to track the progress of the employees as well as productivity of departments in the company (Stewart and Gapp 2014). The companies that fall under the category of small medium enterprises use KPI. Apart from that, human interventions are required to check that the tool is working in a right manner or not. Implementation of KPI in the operations department helps in making a comparison in the identified areas that requires improvement (Bateh et al. 2013). It will help the managers to highlight the areas that are not working properly compared to the other working areas.
Conclusion
The report focuses on the changed business plan of the apparel company of United Kingdom. The consultant has provided a detailed description of the various aspects of the current business plan as well as the changed business plan proposed for the business. The company is suffering from loss and it requires suggestion for a changed business plan. The study is focused to implement various approaches that are required to improve the current situation of the business. Apart from that, the contingency plans along with action plan are formulated so that the new plan cannot fail in their areas of improvement of the company. Many theoretical frameworks of change management along with performance management are described in the study so that the weak areas of the company. Implementation of the proposed business plan will certainly help the apparel company in gaining a market share in the apparel retail industry in London.
References
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