SWOT Research: A Small Family Business

Keywords: swot analysis example, sme swot examination example, marketing plan for family business

Family business is certainly a durability for RCDC as in a family owned business, the owners view their as a secured asset to spread with their descendants somewhat than wealth to take during their lifetimes (carron, 1999). In addition, as lately argued by Zellweger(2007), the prolonged time horizon that characterizes family firms reduces the marginal threat of an investment and therefore the corresponding risk-equivalent cost of equity capital (McNulty, Yeh, schulze and Lubatkin, 2002). Consequently, family owned organizations can seize investment opportunities their non-family rivals do not consider as sufficiently attractive or consider too high-risk;"such a predicament offers family possessed firms the likelihood of growing their activities unhindered by competitive opponents and of conquering markets that competitors cannot enter"(Zellweger, 2007, p-9)

Moreover, households may bring with them significant financial and physical resources, called "survivability capital"(Simon and Hitt, 2003), which may be used to maintain the business enterprise during monetary hardship or after unsuccessful strategic movies (Dyer, 2006). These elements are usually known by customers and suppliers, who may build and cultivate long-lasting relationships because of the goodwill and trustworthiness produced by the family commitment (dollinger 1995).

2) Strong Criticism from shareholders

The continuous negative feedback from directors of warwick investments regarding the poor dividend repayment record and the lack of strategic direction is actually a durability of RCDC as it functions as a drive for improvement. It really is for that reason critism and the drop in turnover that the Lancasters and Yorks are trying to find every possible way to save lots of their business and satisfy the stakeholders.

3) Long-term experience in the dry cleaning business

As per the situation RCDC has been in the dried up cleaning business for greater than a decade and they have were able to run the business enterprise reasonably well meaning they experienced a good market share and enough customers to patronize and a fairly good understanding of this business. They are able to use this experience to beat the weakness's and excel in their traditional business.


The RCDC has got both full time and part-time personnel which is a strength as it increases the worker morale, engagement and determination to the company. It reduces the absenteeism to a certain level and improve the chances of recruiting exceptional employees. It even helps in reducing the staff turnover and expanding the image of the workplace.


1)High personnel turnover

As mentioned in the case, RCDC is facing a hgh degree of personnel turnover at both staff and managerial level which is one of the sources of the reduced organisational performance. High employee turnover can harm the overall productivity of a company and is often a indication of other troubles. Every company strives to possess high productivity, lesser turnovers and maximum success. managing turnover effectively is a must to achieve the above goals. Abassi and Hollman(200) pressured that the professionals must recognise the employees as major contributor to the efficient achievements of the organisations success. Furthermore, highly encouraged and performing individuals are the key factors of the organisational productivity. Therefore, there may be need to develop a thorough knowledge of the worker turnover from the point of view of causes, effect and strategies to minimize turnover.

2) Lack of training and development

This another weakness of RCDC which is worth mentioning as this is often a major cause for employee turnover as there is absolutely no growth within the organisation. based on the case, working out and development interventions are completely nonexistent meaning there is absolutely no opportunity for employees to develop or achiveve some sort expertise in their particular professions. In addition, Training and development is asource of competitive edge for companies which helps to remove performance zero employees.

There I greater stability, flexibility and convenience of growth in an organisation. Training plays a part in employee balance in at least two ways. Employees become effective after considering training. Productive employees contribute to the expansion of the organisation and progress in trn makes stableness to the workforce.

3)safety precautions at the job

The mishap that took place with one of the employees at RCDC helps it be evident that safety precautions are completely missing in the company which means RCDC is placing the ife of its employees vulnerable by causing them work in an unsafe environment which in turn spoils the image of the company.

4) Conflict one of the owners

There is a lot of conflict one of the owners of the RCDC which is one of the main factors behind the underperformance of the business. There is no strategic planning, no control no direction by any means.



One of the primary threats to all their is competition and RCDC is no exception. RCDC's main competitor is Bletchey's fast clean plc which operstes about in the same geographical area. The Bletchey's may also take benefit of the inner problems experienced by RCDC to use greater market talk about. when compared with RCDC, the marketing strategies and rates guidelines of Bletchey's. are better and their success rate is also quite high which explains why many of the RCDC employees have joined up with Bletchey and they have been able to pull many of the customers along with them.

2) Seasonal work

Usually people consider dried cleaning for woollen and expensive clothes therefore the sales tend to be higher in winter and fall where as summertime is marked with reduced sales as the clothes are machine washable.

3) Increasing nmber of supermarkets

Another danger posing the traditional neighbourhood dried cleaning business is the increasing amount of supermarkets getting the dried cleaning stores. Most of the pople nowa-a-days think it is convenient to look from these supermarkets where they get their clothes also drycleaned. This can eventually lead to complete extinction of the original drycleaning.

4)Legal issues

Court conditions filed against RCDC by its employees is another menace to the simple functioning of the business. Firstly it can ruin the image of the business by reducing the sales and secondly it does not permit the management to concentrate completely on their business as most of their time goes in finding new ways to cope with these problems.


1)Diversification of business

One of the opportunities is to diversify their business into areas such as shoe auto repairs, film processing, key lowering and agreement cleaning in addition to achieveing a level of excellence in their primary business i. e dry cleaning. Diversifiacation can help RCDC with an increase of success and seasonal obstacles.

2)Innovative Marketing strategies

RCDC will come up with some ground breaking marketing suggestions to top the market e. g:E-marketing, offering special discounts to its devoted customers etc. Additionally, it may improve its customer support by providing the choice of home delivery which can prove convenient to customers possessing a busy daily routine and may also beat the risk of one stop-shopping.

3)Improved upon organistioanl strategies

RCDC needs to use training and development programs for employees which can assist in attracting more and more people for work, reduce staff turnover and can make the process more organised. Safety precautions also needs to be included in this program so the rate of crash is minimised.

4)Centralisation of procedures

Decentralisation Iis a much better opportunity than centralisation as decentralisation would lead to better customer support and speedy dried up cleaning that could be helpful in getting ultimately more customers and increasing the profits. In addition to this store managers should get more responsibility and forces so that they can take decisions regarding an problem related to the precise store as and required and don't have to depend on getting requests from headquarters.

Present and potential problems confronted by RCDC in the next areas:

a)Businesses management and organisational issues

"Businesses management is the experience of taking care of the resources which produce and deliver products and services. The procedures function is the area of the oranisation that is responsible for this activity". Every organisation comes with an operation's function because every company produces some type of products and /or services. Site 4

No organisation can survive in the long term if it cannot supply its customers effectively. Which is essentially what operation 's management is about designing, producing and delivering products and services that gratify market requirements. For any business, this can be a quite crucial activity.

General problems in operation's management experienced by small and medium sized organisations

Operations management is just as important in small organisations as it is in large ones. Irrespective of their size, all companies need to produce and deliver their products and services proficiently and effectively. However, in practice, managing businesses in a tiny or medium size organizations has its own set of problems. Large companies may contain the resources to dedicate individuals to special duties but smaller companies often cannot, so people may have to do different jobs as the need arises. such an informal structure can allow the company to respond quickly as opportunities or problems promote themselves. But decision making can also become puzzled as individual's functions overlap. small companies may have a similar functions management issues as large ones nevertheless they can become more difficult to separate from the mass of other issues in the company.

Present and potential procedures management problems confronted by RCDC can be mentioned a practices
1)No understanding of the operation's strategic performance aims

The to start with responsibility of any operations management team is to understand what it is wanting to achieve, this means finding out how to assess the performance of the procedure at different levels, from wide and tactical to more functional performance goals. The management in RCDC is not paying any focus on this critical area which can lead to further damange to the business's market show.

2)Operations technique for the company

Operations management will involve a huge selection of minutes by minute decisions so it is vital that there surely is a couple of general guidelines which can guide decision-making towards organisation's long run goals called an businesses strategy. RCDC do not have any specific businesses strategy which is why the organisational development is suffering and can continue to suffer if this matter is not resolved.

3)No measures for increasing the performance of the operations

The carrying on responsibility of all operations professionals is to omprove the performance of these businesses which is another issue to be resolved in RCDC.

4)interpersonal responsibility of procedures management

It is increasingly recognised by many businesses that procedures manager have a set of broad societal responsibilities and concerns beyond their immediate activities. the general term for these aspects of business responsibility is corporate and business social responsibility or CSR. The accident that occurred with one of the employees and the managements attitude towards that event makes it evident that RCDC completely lacks CSR. It has already spoiled the brand image of the company and can mess up it completely.

All these issues can change RCDC into a declining organisation.

Organisational Issues:

1)Because of the heavy drop in sales over the last couple of months, the directors are thinking about centralisation of operations at Leicestershire site leading the business to substantial personal savings in personnel costs and providing it with the opportunity to get rid of surplus machinery. However because of the conflict between your owners the thought of centralisation will not seem to work out. If any decision is not used the near future, the success of the business will keep heading down and lastly the owners may need to close don the company.

2)Today's 24 branches managed by RCDC aren't at all enough as far as the thought of centralisation is concerned. RCDC's main goal is to boost the sales and then for doing this they have to attract more and more customers which can only happen if they provide better and quik services with their customers when compared with the challengers. so, the geographical coverage is vital for the development of the business enterprise.

3)The issue of moving goods from the shops to the herb and then back to the outlet stores and customers is another issue which needs to be tackled. Making goods and services available to the customers promptly is the largest challenge for all the organisations as it is a great way of building healthy romance with customers and making them devoted to the company.

c)Sales and marketing Issues:

Marketing Planning

"Marketing Planning can be defined as the application of marketing resources to achieve marketing targets"(P-16, marketing strategies that work)

In simple words marketing planning is a series of activities and the formulation of programs for attaining them. Companies generally go through a management process in expanding marketing ideas. In small, undiversified companies this technique is usually informal and same is the case with RCDC. RCDC needs a a lot more systematized marketing plan to concentrate on more customers.

Constructing a marketing plan is the most challenging process for RCDC as the owners do not agree to each other plus they all have different prospects and goals completely.

2)Decling Sales

The sales of RCDC are decling rigorously and the company is not taking any serious action regarding this matter. The company must perform a marketing audit which is usually conducted by organisations in situation of decling sales, falling margins, lost market talk about etc. Marketing audit is a means of determining problems exactly so that all problem can be attended to and eradicated.


According to the truth, Yorks want to diversify their business and move into related ares such as Shoe fixes, film handling. key reducing and contract cleaning which is actually a good notion to increase the overall profitability and can help RCDC to overcome the bad stage of reduced sales. Hoever the disagreement from lancasters is not allowing this idea to be converted into reality.

4)Sales Campaign

d)Personnel and industrial relationships:

1) Training and development

Absence of training of and development is one of the biggest problems in RCDC. According to the case training and development programs are believed to be a cost to the business and the employees are expected to get work as each goes. Training and development can provide RCDC with the much needed competitive advantage by improving the performance of the workers and the organisation all together. If this practice remains RCDC will completely fail in attracting employees to work for this, as there are no development opportunities for employees.

2)employee relationships

As per the situation, there is a lot of friction between the employees and the management which is one of the many reasons for RCDC's high staff turn over. The management needs to value its employees and show matter to their problems as the employees are the building blocks of any company. To be able to achieve longterm goals and future success RCDC must improve its relations using its employees.

3) Health and safety

The staff at RCDC are inclined to damages as there are no health and safety measures. The management is merely worried about increasing the gains with out a proper planning and matter about folks who can actually help RCDC achieve it.

4) Job dissatisfaction
The high employee turnover helps it be quite noticeable that the employees aren't at all satisfied with their job at RCDC. There can be various reasons for it e. d

No progress opportunities.

Risk factor

No concern for employee's health from the management.

Work stress.

Competitors etc.


Orientation programs are must for each and every organisation as it can help new employees to get aware of the work tactics and the anticipations of the organisation. These orientation programs are completely missing in RCDC and it results the notion of employees.


RCDC is working with court cases which is not a good signal for the development of any business as it impacts the brand image.

7)Internal issues

Another serious concern is the conflict between the owners which has created a sort of deadlock in the company as no ideas are put into action. These interior problems have previously influenced and can futher have an effect on the goodwill of the business.

Accounting and Money:

The present and potential problems faced by RCDC in accounting and money are as follows
1) Repayment of dividends

One of the primary problems in RCDC is the indegent dividend repayment plan. Every company has a responsibility towards its stakeholders and if an organisation will not fullfill the expections of its shareholders, it has to bear the results such as inside conflicts, lack of credibility, reduced sales etc. which is exactly the case with RCDC. Therefore, RCDC must improve the standard of paying dividends to its shareholders as well as for doing so, it has to manage its money in an effective and designed way and keep maximising the shareholders riches.

If the business is to attain its target of maximising shareholder wealth then it must use its resouces to maximise revenue and cash moves. This may maximise shareholder riches since there is general contract that show prices mirror the discounted value of an firms cash moves. Whilst it may not be possible to increase dividends each year, shareholders like to know that dividends will be paid because they provide a signal to investors. A reduction in dividends is likely to lead to a reduction in share price because the transmission to the marketplace is one of the financial difficulties ahead. such a reduction in a firms talk about price will in evitably have other financial implications. The business may become concentrate on for a possible dominate, especially if another company believe's that the decrease in profits has been as a result of poor management alternatively than hostile trading conditions. Even though this does not happen the business may see its credit history reduced thus increasing its capital costs due to increased risk identified by traders. Capital spending may also need to be stopped so that they can protect the firms cash flow.

2) Funding the new project of centralisation

RCDC is considering centralisation of businesses which according to the management will help in reducing staff costs and the awareness of operations allows the company to use good thing about the economies of level. In, addition to the the machinery in the branches could be sold off to get some finance to invest in the new vegetable. The main problem with the centralisation is that the company is devoid of enough funds to invest in the new place which is estimated to cost around 7, 50, 000 pounds. even retailing from the surplus equipment in branches will hardly aid in solving the funding problem.

At present, there is no possibility of presuming any upsurge in sales, that leaves RCDC with the choice of going for a loan from a standard bank to finanace the task and for achieving this the company must discuss the success of the proposed project which is likely to be 1300000 pounds that can act a basis for the lender regulators to sanction the loan. However, considering the present market condition of the business, it is very difficult for RCDC to obtain a loan sanctioned from a loan provider as it includes lost its credibility. Even when RCDC manages to get a loan, it must give a serious thought how to repay the loan. Every business and every new task requires risk, but it ought to be a determined one. Determined risk makes the success of any company more predictable while, uncalculated risk can completely affect the business enterprise.

3) Costs involved in the new task

As per the suggested plan, only the staff cost is demonstrating a reduction by 1, 80, 000 pounds all other costs are assumed to be same or to show a rise e. g, the head office cost at present is 240 and even for the new seed, it is proposed to be 240, but the operating surplus is meant to increase by 130000 pounds, same is the situation with flat rentals and other entities. Based on the data provided in the overview of total annual operating statement, it could be grasped that the suggested plan involves more cost in support of marginal keeping. so, the management should very seriously analyse the implications of the suggested plan and determine whether they should invest in this course of action or not.

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