mba-vital element
TRANSCRIPT
Supervisor – Paul Rhodes Leader – Nikolas Stavridis77094447Anujkumar Sharma77154475Aditya Somani 77153289Tarun Patel 77153438Khiriya Lahmer 77149778
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Consultancy Project
Acknowledgements
Genesis Consultancy (G.C.) Group would like to thank our supervisor Mr. Paul Rhodes
for his continuous guidance and enthusiastic support for completing this consultancy report
successfully. Without his supervision and constant help this project would not have been
possible. His knowledge and experience has helped the group members to be able to fulfil the
requirement of our Client.
The group would like to thank Mrs. Marie Kerr for supporting us right from the beginning
and helping us during any difficulties. The opportunity to analyse the importance of a
Facilities Management (F.M.) company has given to the group a clear understanding about
the F.M. industry in the market.
We would also like to thank all the people who were directly and indirectly responsible
for the completion of this project. The primary research was very crucial for the success of
this project and hence we appreciate the assistance of all the interviewees and the people who
showed an interest and managed to complete our questionnaire despite of their busy schedule.
We have great pleasure in thanking the Managing Director of the Vital Element Mr. Nick
Calcutt, who allotted so much of his time to explain his requirements for the company and
also expressed himself so clearly to the group regarding his specific goals.
In addition, we would like to thank all our module tutors of the MBA faculty of Leeds
Beckett University for sharing their years of experience during their lectures and seminars
and also giving us a strong basis of academic theories.
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Executive summaryThe purpose of our research is to understand the importance of the F.M. sector and
develop a marketing plan for The Vital Element (V.E.) that specialises in providing F.M.
services to various organisations. They mainly specialise in providing five key services,
namely premises, grounds, repairs, cleaning and décor. The majority of the sales are
generated by schools. This has created a desire for V.E. to expand its business in schools in
the Barnsley and Huddersfield area. The aim of this project is to design a marketing plan with
the help of recognized marketing strategies that are result-orientated and in line with the
company’s mission, vision and goals.
The GC Group has been involved in extensive research to collect both primary and secondary
data in order to understand the market. The methodology which has been used was based on
the so-called research ‘onion’ to get a deeper understanding of its target market. The
secondary data that has been used is the company’s website, internet research and literature
review to help us understand the different concepts on which marketing strategies are based.
We have also used various strategic frameworks to help us understand the external and
internal environment of the industry. The primary data was collected by means of personal
interviews, telephone interviews and questionnaires.
After three months of research, hard work and analysis, the group came up with a strategic
marketing plan. Findings from primary and secondary research became the report’s
foundation for outlining all possible business opportunities. Some schools are not satisfied
with the services provided by the F.M. companies they are currently employing. We gained
some valuable insights during our primary research, such as the importance of entering into
state schools and this must be the key to expand business. Not every school can take the
decision by itself to choose an F.M. company. The local authorities play an important role in
taking this decision for state schools in terms of selecting F.M. companies.
However, as the research was carried out mainly in the schools of Barnsley and Huddersfield,
our conclusion and recommendations cannot be generalised as a rule of thumb for all
potential clients due to various limitations which will be explained in the body of the project.
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Table of ContentsAcknowledgements...............................................................................................................................2
Executive summary...............................................................................................................................3
1. Introduction...................................................................................................................................7
1.1 Background..................................................................................................................................7
1.2 Company Overview......................................................................................................................7
1.3 Structure......................................................................................................................................8
1.4 Strategic Direction.......................................................................................................................8
1.5 Problem Rationale.......................................................................................................................9
2. Aims and Objectives....................................................................................................................11
3. Methodologies.............................................................................................................................12
3.1 Overall Strategy.........................................................................................................................12
3.2 Data Collection..........................................................................................................................14
3.2.1 Secondary data...................................................................................................................14
Limitations...................................................................................................................................15
3.2.2 Primary Data.......................................................................................................................15
Limitations...................................................................................................................................17
3.3 Ethical consideration.................................................................................................................17
4. Findings and Analysis...................................................................................................................18
4.1 Secondary data..........................................................................................................................18
Literature review.........................................................................................................................18
PESTLE ANALYSIS.........................................................................................................................18
PORTER’S FIVE FORCES................................................................................................................22
Competitor Analysis.....................................................................................................................24
STP (Segmentation, Targeting and Positioning)...........................................................................25
Marketing Mix Seven P’s.............................................................................................................26
4.2 Primary data..............................................................................................................................30
Questionnaire findings.................................................................................................................30
Interviews....................................................................................................................................33
Telephone Interviews..................................................................................................................34
Summary of findings from the VE’s Existing Clients.....................................................................36
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5. Conclusion...................................................................................................................................36
6. Recommendations and Marketing Plan.......................................................................................38
Personal selling............................................................................................................................38
Creating awareness.....................................................................................................................38
Ansoff’s Matrix............................................................................................................................39
Registering on Yortender.............................................................................................................40
Bibliography.........................................................................................................................................41
Appendices..........................................................................................................................................47
Appendix1 – Literature review........................................................................................................47
Marketing Communications Strategy..........................................................................................47
Marketing Communications Mix (Promotion Mix)......................................................................47
Business to Business Marketing (B2B).........................................................................................51
Buying Centre Model...................................................................................................................51
Decision making model................................................................................................................52
Appendix 2 – Questionnaires and Interviews..................................................................................54
Questionnaires............................................................................................................................54
Telephonic Interviews..................................................................................................................85
Appendix 3 – Ansoff Matrix.............................................................................................................92
Appendix 4 – List of potential clients...............................................................................................93
Appendix 5 – Email from Kirklees....................................................................................................94
Appendix 6 – Contact details of County Council..............................................................................95
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Table of Figures
Figure 1- Schools in Huddersfield and Barnsley Respectively............................................................10
Figure 2- The Research ‘Onion’ (Saunders, et al., 2009).....................................................................12
Figure 3-PESTLE Framework.............................................................................................................18
Figure 4- Level of Unemployment of countries in EU (United Nations, 2015)...................................21
Figure 5- STP Framework (Gbadamosi, et al., 2013)..........................................................................25
Figure 6- The 7Ps of Marketing Mix (Kotler, et al., 2009)..................................................................27
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1. Introduction
1.1 BackgroundThe service industries have shown an enormous growth since the 1980s and 1990s
(McGregor, 2007). One of the ramifications of this growth is the development of a service
culture that has had a direct impact on the property management industry, through the
emergence of F.M. as a professional discipline. This initially occurred in North America, then
in the UK and Europe (McGregor, 2007). Leaman (1992) stated that the term ‘facilities
management’ means to bring together the knowledge from design and the knowledge from
management in the context of building. In opposition to that Thompson (1990) argued that it
is more of a strategic view of discipline, stating that the actual F.M. is not about construction
and building operations maintenance but, it is about the facility planning where building
design meets business objectives (Yao, 2013).
The European CEN definition of F.M. is expressed as: “the integration of processes within an
organisation to maintain and develop the agreed services which support and improve the
effectiveness of its primary activities.” (CEN EN 15221 -1) (Yao, 2013).
There are many big companies like Spie, Hochtief and Mitie that are providing F.M. services
to its clients. (DIRECTORY, 2015). These companies are the main competitors of V. E. and
also local service providers. As it is only a two-year old company V.E. has a great deal to
achieve in the future (Element, 2015). To be successful, the company needs to concentrate
more on its resources in order to utilise them for greater opportunities to increase their
revenue and achieve a sustainable competitive advantage. This is a service-based company
and therefore, getting benefit from marketing strategies is a long-term process due to the
limitations this has in terms of people, finance, and reach (Friday & Cotts, 1995).
1.2 Company OverviewThe V.E. is a young innovative company which provides services to maintain
facilities in various organisations like schools, charities, financial services, healthcare and
commercial organisations (Element, 2015). The company was founded in 2012 by Nick
Calcutt and he is the present Managing Director of the company which has its head office in
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Barnsley (South Yorkshire). The company also operates its business from Huddersfield (West
Yorkshire). V.E. is a member of the British Institute for Facilities Management (BIFM) and
specialises in five key services that every building or organisation needs in order to provide a
sustainable and friendly working place (BIFM, 2015).
The company differentiates themselves from its competitors by focusing on the problems of
their customers by introducing more cost effective methods of managing their clients’
premises and non–core operations. The company offers tailor-made packages that suit their
clients’ needs. V.E. works on the principle of fresh approach, i.e. the company is committed
to helping their clients change the way they do business, by minimising the costs and
increasing the value (Element, 2015).
1.3 Structure
The V.E. is a sole-proprietorship company and the decision-making power and
control over departments and divisions is exercised by the Managing Director, Mr. Nick
Calcutt. Their client portfolio emphasizes mainly on primary schools, recognised national
charities and regional financial services. The company employs a team of eight direct staff
and six self-employed partners. By utilising their professional team, the company reduces the
management’s overheads and effectively manages and schedules their activities, thus
reducing wastage and inefficiencies.
1.4 Strategic Direction
After analysing the clients’ requirements for a new marketing plan, the G.C. Group
distinguishes how the company can become sustainable and productive for the upcoming
years. The client direction is to increase its client portfolio. However, the only approach that
the company has been using until now is by mouth to mouth sales. The G.C. group has come
up with some solutions to attract more clients in future and has produced the guidelines
required for listing the company’s name with the local authorities.
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1.5 Problem Rationale
After doing extensive research for approximately three months, the G.C. Group has
found out that V.E. has a tremendous opportunity to grow in F.M. services. There is a need
for services that are client-based and that surpass customers’ expectations regarding service
response and delivery.
After visiting V.E. in Barnsley, we got a clear picture of the Business Plan for the
upcoming years in terms of growth proposed by the company. The Managing Director of the
company came up with an estimation of 5 million turnover by the end of 2018. The
company’s vision is to operate nationwide with regional offices, employ and develop the best
people and differentiate itself by becoming a leading provider of FM services within the
United Kingdom. However, checking the background and mainly the current turnover of the
business, the group has clearly defined and stated the problem.
Currently, the company holds a turnover of 150 thousand pounds and the vision of the
company is to reach 5 million by the end of 2018. This will be quite difficult for the company
to achieve at its current speed of growth because it has limited clients. Firstly, there is a huge
gap between the current turnovers compared to the expected which means the company needs
to grow over 86% geographically in order to achieve its needs. The group has identified that
the plan is overestimated and it needs to be reconsidered in order to deliver effective
solutions for the company’s growth. After checking the company’s client portfolio, the G.C.
group has stated that the main source of income comes from offering F.M. services to
primary schools. As they mainly operate from Barnsley and Huddersfield, the group has
considered these areas as the main target market.
This project is mainly focused on preparing a marketing plan for V.E. to achieve their short-
term and long-term goals. In order to design a marketing plan that can deliver real value to
the company, our group has used some theoretical frameworks and academic theories to look
into the situation more deeply and come up with possible solutions. The following
frameworks have been used to identify the problem to find the solutions and provide
recommendations.
To know the strategic position and capabilities the G.C. Group has used:
PESTLE Analysis
PORTER’S Five Forces Analysis
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To prepare the Marketing Plan the G.C. Group has used
Segmentation Targeting and Positioning (STP)
Marketing Mix (Seven P’s)
Ansoff Matrix
Figure 1 (below) shows the opportunities for the V.E.
Figure 1- Schools in Huddersfield and Barnsley Respectively
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2. Aims and ObjectivesThe main aim of this project is to come up with a strategic marketing plan that will help V. E. to
increase its number of clients. To achieve this aim successfully, the G.C. group has come up with
various objectives at a number of levels. In order to understand what is required and by what time it
can be achieved SMART objectives are designed (Richman, 2006). This will help the V.E. to measure
their performance and help them to know whether their aim has been achieved. Also, the
company can change its course of work to overcome any difficulties or obstacles faced during
this period.
Research Aim
To prepare a Marketing plan to reach 5 million turnover over next three years.
Research Objectives
It is important to develop project objectives in order to clearly outline the scope of the
project.
1. To identify potential target market.
2. To develop a strategy to increase the number of clients.
3. To understand the clients’ needs and important F.M. services.
4. To develop a marketing communication plan to cross sell other services to existing
clients.
5. To identify the list of important accreditations required to enter into local authority.
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3. MethodologiesA good consultancy report depends on reliable data as it is intended to guide
organisations towards making correct decisions (Sekaran & Bougie, 2013). On the other
hand, it is also meant to aid in understanding customer satisfaction. With the help of proper
research methods, the data collected can be reliable and helpful in making good decisions.
Therefore, it is very important to understand and use the proper research techniques (Ghauri
& Gronhaug, 2005).
3.1 Overall StrategyFor any research, various methodologies can be chosen. The research ‘onion’ (Saunders, et
al., 2009) illustrates the different stages that a researcher must go through. Figure 2 (below)
shows the different layers that have been used in this project during the research.
Figure 2- The Research ‘Onion’ (Saunders, et al., 2009)
The research philosophy
The research philosophy is based on a belief regarding how data should be collected,
analysed and interpreted in the most useful way (Novikov & Novikov, 2013). The G.C.
Group has taken a pragmatic philosophical position for its research. This approach gives the
G.C. Group the flexibility to use any method that is best suited to its research problem.
Therefore, it grants the group the freedom to choose any of the methods, techniques and
procedures typically associated with quantitative or qualitative research. We have used
different techniques at the same time (Saunders, et al., 2009). For example, we performed
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some face-to-face interviews with schools and at the same time we asked them to fill out
questionnaires.
The research approach
The research approach we used for this project is known as ‘abduction approach.’ The
logic in abduction inference, known premises is used to generate testable conclusions. This
approach makes generalisations from interactions between the specific and general. We have
used the data to evaluate the situation, identify themes and patterns. This data begins with the
observation of a ‘surprising fact.’ These surprises can occur at any stage in the research
process (Saunders, et al., 2009). The reason behind using the abduction approach for this
project is that it enables us to take more informed decisions about our research design, which
consists of more than just the techniques by which data is collected and procedures by which
it is analysed (Ghauri & Gronhaug, 2005).
The methodological choice
In order to understand the process of how schools and customers select Facilities
Management Company we have chosen the “Multi-method Qualitative Approach”. This
approach is also termed as ‘Mixed methodology’ as two or more sources of data or
researched methods can be used (Saunders, et al., 2009). The G.C. Group has mainly focused
on qualitative than quantitative data due to the geographical and client portfolio limitations.
The rationale of multi-method research helps in ensuring that the researchers are not over
reliant on a single source or research method adding reliability and confidence in findings
(Sekaran & Bougie, 2013).
The research strategy
The research strategy that was employed by the researcher in this project included a
survey in the form of questionnaires and narrative inquiries with the use of interviews. As our
primary data is mainly focused on a questionnaire and interviews, this primary research was
conducted at schools in the areas of Barnsley and Huddersfield.
The research time horizon
The research time horizon that we used is cross-sectional i.e. it is suitable for short-
term study (Saunders, et al., 2009). This design helped us in using qualitative and quantitative
research to measure an aspect of behaviour in schools at a single point in time.
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The research technique and procedures
This is the final layer of the Research Onion. After all the decisions we made, the
following methods were chosen as it was decided that they would work best for collecting
and analysing data to create the results that would provide a solution to the problem that we
were researching. This project includes data collection from both primary research and
secondary research.
3.2 Data CollectionData collection is a systematic process of collecting and analysing information for a
particular purpose, taken from different sources that enable the researcher to answer the
research questions and evaluate results (Sapsford & Jupp, 2006). This project includes data
collection from both primary research and secondary research. To collect primary data, we
used both qualitative and quantitative research.
3.2.1 Secondary dataSecondary data is the data that is already available. This refers to the data which has
already been collected and analysed by someone else (Kothari, 2004). There are two sources
of secondary data in relation to business, i.e. internal and external data. The former consists
of the sales record, sales invoice; balance sheets etc., whereas the latter is made up of
secondary data such as websites, books, newspapers, magazines and literature (Wilson,
2014). Although there are many sources from which to collect secondary data, special caution
must be taken by the researcher. The secondary data must possess characteristics like
reliability, suitability, and adequacy. Researchers should select appropriate methods of data-
collection based on the nature, scope, time factor, precision and object of the enquiry
(Kothari, 2004).
Internal and external resources
Company brochure
Company website
Internet
Literature review
Marketing and communication strategies
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Business to business marketing
Buying centre model
Decision making model
Models and theories
PESTLE analysis and PORTER’S five forces analysis
Segmentation Targeting and Positioning (STP)
Marketing Mix (Seven P’s)
Ansoff’s growth strategies
Advantages
There are many advantages of using secondary data. Firstly, we can find much
information available from our institution library for little or no cost. Secondly, in
comparison with primary data, secondary data can be more straightforward to collect
(Wilson, 2014). The acquisition of secondary data is quick and less time consuming. It may
allow the researcher to cover a wider geographical, cross-sectional and temporal range
(Sapsford & Jupp, 2006). Finally, secondary data can be used as a foundation for evaluations
with the primary data.
Limitations The major challenge in using the secondary data is ensuring that the data is relevant,
recent and reliable for the project (Wilson, 2014). While collecting the primary data, the
researcher can control methods of collection but the origin of secondary data may be
questionable (Sapsford & Jupp, 2006). This secondary data may not fulfil the actual needs of
the project. Since this data is available to everyone, the information it contains is not
exclusive. Also, this data may not match the problem being researched and it may be
outdated (Wilson, 2014).
3.2.2 Primary DataPrimary data is the data collected directly by the researcher for a specific purpose or
study which was previously unknown. There are several methods of collecting primary data
such as the observation method, the interview method, the survey method and the
questionnaire. The main advantage of primary data is its reliability as it is collected for a
specific purpose and, hence, it is most relevant for the research study. The data collected by
the researcher can give a holistic and realistic view and also better insight regarding the target
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audience under study. This project has used two methods of primary research, i.e. in-depth
interviews and the completing of questionnaires.
Qualitative research We did qualitative research in order to get inside customer’s minds. This includes
face-to-face interviews in schools and also telephone interviews with V.E.’s existing clients.
This gave us the opportunity to find out how the system works in schools regarding the
selection of F.M. companies.
Face to face interviews
The face-to-face interview is a method of exposing the hidden factors at the heart of
the interviewee. More information can be obtained at a greater depth. The main advantage of
this method is flexibility. However it is an expensive way of collecting data as it requires
certain skills and the physical presence of the interviewer. Nevertheless, many researchers
believe that the face-to-face interview provides more accurate information than the
questionnaire (Struwig & Stead, 2001).
Telephone interviews
The main advantage of telephone interviews is their speed. With this method of data
collection, the respondents tend to answer the open-ended questions more briefly. Questions
that require lengthy answers have to be limited. During the interview, questions are asked and
all answers should be noted or recorded. It is a particularly cost-efficient method of data
collection. Interviewees located at a distance can be easily contacted (Sapsford & Jupp,
2006).
Quantitative researchQuantitative research is a well-known methodology and it is the most popular way of
collecting data. This is also the most common quantitative research method used in
management consultancy projects. We used the survey method in the form of a questionnaire
for quantitative research for collecting our primary data.
Questionnaire
A questionnaire is a set of questions asked by the researcher to obtain information
about the research topic. Our questionnaire was properly constructed and responsibly
administered as it was a very important part of the survey. The main benefit of using a
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questionnaire for quantitative research is that this process is structured. Our questionnaire
consists of 15 questions. The questionnaire was prepared in such a manner so that it helped us
in understanding the problem being researched and enabled us to come up with practical
solutions. Please see appendix for questionnaire.
Disadvantages
The main disadvantage of using questionnaires is that its structured approach is less
flexible. The questionnaire was prepared based on our understanding of the problem being
researched. Another limitation of this method was that only written responses were
considered and unwritten responses like body language, tone of talking were not considered.
Also, some of our respondents did not fill in the questionnaire completely.
Limitations The main limitation of primary data is the process of collecting data is that it is time
consuming and expensive (Hair, et al., 2015). The whole process of collecting data has to go
through stages such as preparing questions for interview, designing the questionnaire, pilot
study, data collection, coding and analysing. This is time consuming and makes it rather
difficult to conduct within a short period of time (Sapsford & Jupp, 2006). The collection of
primary research requires skills and expertise and cannot be done by an unskilled person. The
cost of primary data is more expensive than secondary data. Sometimes, the data required is
scattered over different companies, geographical areas etc. and hence it may not always be
feasible to travel to collect all the data (Wilson, 2014).
3.3 Ethical considerationEthics control and guide the course of action undertaken by the researcher (Oliver, 2010).
We have provided the ethics form and it was approved by Leeds Beckett University. The
ethical issues have been taken into consideration in our research to safeguard the people who
are directly or indirectly related to the project. We have obtained the consent form for our
questionnaire and interview questions. The confidentiality of the information collected has
been protected and used for consultancy project purpose only.
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4. Findings and Analysis
4.1 Secondary data
Literature reviewMarketing communication strategy, Business to business marketing (B2B), Buying centre
model and Decision making model are explained in Appendix 1.
PESTLE ANALYSISIt was essential to conduct a PESTLE analysis for V.E. as this is the strategic tool that is
employed to gain information regarding the Macro Environment, i.e. the external
environment surrounding any company and within which it operates. PESTLE is a
framework made up of six factors, as shown in Figure 1, and each of these factors must be
thoroughly investigated during a PESTLE analysis in order to determine how each one
affects the company’s profitability.
Figure 3-PESTLE Framework
The PESTLE analysis that the GC group completed reveals the way in which each of these
six factors affect V.E., adversely and beneficially:-
Political and Legal:
As V.E. is operating in the U. K. which is a developed nation within the European Union
(E.U.) this has strengthened the company’s position (Daft, 2012). However, as schools are the
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Political
Economical
Social
Technological
Legal
Environmental
main target market for V.E., the way in which education is mainly funded by Local
Authorities - and Central Government, in the case of the new Academies - has proved
problematic for obtaining contracts. The G.C. Group researched the way in which the current
political situation affects schools in the UK as these form the main target market for V.E. It
was discovered that the majority of schools are presently run by Local Authorities and so
they are responsible for choosing the F.M. companies to service their schools, rather than the
schools themselves. The G.C. group has identified the problem that many of these Local
Authority schools already have long term contracts with F.M. companies that have been
chosen for them. This constitutes a restriction that adversely affects V.E’s expansion. Ideally,
the G.C. Group has found that V.E. should aim to get contracts with Local Authority schools
where the work has not already been contracted out on a long term basis. Each Local
Authority has a list of approved F.M. companies that they may employ. This political factor
means that it is essential for the G.C. Group to contact Local Authorities directly (on behalf
of V.E.) in order to investigate the way in which they choose the companies which they
include on their approved lists. It was necessary for the G.C. Group to discover the criteria
used to choose companies. Cost effectiveness is undoubtedly one of the main criteria at the
moment as the Conservative Government prioritizes reducing costs in the public sector, so
the funding for the schools run by Local Authorities is being decreased. As reported in ‘The
Guardian (2015)’ –“Both the Department for Education and the Department for Business,
Innovation and Skills – the government’s two main funding providers for education – face
cuts of £450m a piece from their 2015-16 budgets. And in both cases the cuts will be
concentrated in areas that have already been hit hard”. Due to the fact that the Local
Authority schools are the most prevalent in the U.K., the G.C. Group decided to concentrate
their attention on them in order to assist V.E. acquiring the most contracts. However, the G.C.
Group also investigated the other kinds of schools available in the U.K., namely Academies
and private schools. It was found that, in both cases, the decision-making regarding which
F.M. companies should be employed was left in the hands of the schools themselves.
Nevertheless, in the case of the Academies, the budgeting had to be approved by the Central
Government as they are responsible for all their funding. This could prove even more
complicated than obtaining contracts from Local Authority schools, which had become the
main goal.
The G.C. Group discovered that another restriction affecting V.E. operating within the U.K.
is the way in which the country has so many documented rules and regulations, intended to
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protect both consumers and stakeholders (Stimpson, 2002). In addition to this, the UK has
also passed laws which are directed towards merger agreement. According to these laws,
companies cannot enter into an acquisition or merger agreement unless the Government
grants permission for them to do so. The Government also has the right to change laws at any
time – for example, it plans to increase the minimum wage so small companies will have to
pay their employees more, thereby increasing their costs. As reported in the Telegraph
(2015), “The new living wage of £7.20 for people aged 25 and over is to be introduced in
April 2016, rising to £9 by 2020” (Anderson, 2015). All these laws have a direct impact on
V. E., especially the rise in the minimum wage, which will affect their chances of achieving
their target to increase their revenue to 5 million by 2018. The G.C. Group needs to
encourage V.E. to bear in mind all the factors mentioned above while it is considering a
growth strategy. The company also needs to be aware that any unlawful behaviour towards
the customers or employees can lead to bad publicity as well as legal action (Stimpson,
2002).
The new contracting model launched by the government in April 2014, for the procurement
of facilities management in public sector, with procurement throughout the central
government which is now co-ordinated through a single body, i.e., the Crown Commercial
Service (Mintel, 2014). This mechanism will give access to the small and medium-sized
businesses in gaining contract of central government (Mintel, 2014). Companies registered in
this Crown Commercial Service will be automatically updated when there is a new contract
available for tender (Mintel, 2014). By gaining access in the public sector, the VE being a
small and medium business can grow under this new model by winning contracts.
Economic and Technological:
V.E.’s target of 5 million by 2018 is in line with the predicted increase in revenue for the
F.M, industry, set to grow by 5% by 2018 (Donati, 2015). It can be expected that most
companies will experience an increase in profits as the U.K. is in a phase where the country’s
economic conditions are improving, evidenced by the fact that the inflation rate is currently at
0 % (BBC, 2015) and, in addition to this, compared with other E.U. nations, unemployment
is now relatively low in the U.K. (United Nations, 2015).
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Figure 4- Level of Unemployment of countries in EU (United Nations, 2015)
Hence, due to all the factors mentioned above, the U.K. is an attractive industry. Furthermore,
as it is a developed nation, V.E.’s technological landscape is advanced. Companies within the
F.M. industry are continuously engaging in cost effective technologies and providing
software solutions to differentiate their services from others (Jones, 2015). Although V.E. is
using modern technology to improve their business, it is necessary for them to increase their
usage further in line with their competitors.
UK economy recovered strongly in 2013-14, which is a really good opportunity for
businesses to grow and whole facilities management sector as well (Mintel, 2014). Due to the
solidification of the economy, the government has introduced new facility management
services agreement, through which up to £4.1 billion of facility services will be outsourced to
private companies from now to until July 2019. This scheme is introduced to replace an old
structure of facility management contracts and will help taxpayers to save around £200
million (Sourcing Focus, 2015).
Social and Environmental:
In the U.K., a great deal of attention is paid to the way in which businesses affect the
environment. Companies are expected to perform in an ethical manner, invest in societies and
protect the environment rather than disturb it (Daft, 2012). Although V.E. already operates in
a reasonably ethical manner, it is still necessary for the G.C. Group to impress upon the
company that they should pay more attention to the importance of integrating within their
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strategy as many ethical practices as possible and also corporate social responsibility tactics
that support environmental protection.
In some of the robust forecast in over-55s, UK’s ageing population is increasing and will
continue to increase and this will result in high demand for the hospitals, and other health
institutes, which will in turn increase the demand for the facilities management services
(Mintel, 2014).
By 2022, children population will increase by more than 8milion in England, to cope up with
the increase, the need of more primary school places is surging (Paton, 2013). The Schools
Minister, David Laws, said: “We are working with local authorities to ensure funding is used
to enable every child to attend a good or outstanding local school.” (Paton, 2013). The growth
in the UK’s school-aged population is predicted to go up from 1.8% to 3.9% between 2014
and 2019 (Mintel, 2014). This could also be one of the reasons in driving demand for the
facilities management services and these are some very good growth signs for a company like
VE, who’s primary target for now are schools.
PORTER’S FIVE FORCESAs well as PESTLE, it was also necessary for the G.C. Group to use Porter’s Five Forces in
their project to assist V.E. Porter’s is another strategic tool which can be used to enable
companies to comprehend the competitive forces in the industry as well as to understand the
power of suppliers and buyers and also the possible threats of new entrants in the market and
any substitute services.
This framework used by the G.C. Group assesses the competition which V. E. is facing in the
U.K.’s F.M. industry.
Threat of new Entrants: The G.C. Group has recognized that the threat posed to
V.E. from new entrants is medium to high in the market since companies can start
small and increase their scale of operation in future as the cost of the F.M. business is
low (FMJ, 2013). However, there are large players currently in the industry that have
acquired a considerable portion of the market (iFM, 2015). Therefore, companies who
enter the industry need to differentiate their products and services.
Bargaining power of suppliers and buyers: The G.C. Group have discovered that
these bargaining powers affect V.E. to a large extent. Within the industry, there is a
strong presence of numerous buyers since large properties such as schools demand
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F.M. services. However, there are numerous suppliers in the industry as well. Hence,
buyers have a great deal of choice regarding which company they wish to supply their
needs. Nevertheless, since contracts are usually long-term and involve large
investments, the buyers do not have the power to switch in the middle of an ongoing
deal. However, they can switch to other companies later, on the basis of better
services and packages being provided. The supplier power in the industry depends on
the size of the F.M. companies. The large players in the industry are able to gain good
deals from the suppliers in the market. However, when new services such as cloud
computing are introduced, only certain suppliers are able to cater for F.M. companies,
thus increasing their power.
Threat of Substitutes: Threat of substitutes is low since, apart from performing all
by themselves the renovation and cleaning of their properties, companies have little or
no option to switch to substitute products. However, large institutions, such as
schools, usually cannot engage in cleaning and renovating their own premises, due to
there being a lack of staff with sufficient expertise.
Competitive Rivalry: This is high within the F. M. industry as companies are
continually entering into different partnerships and mergers to sustain their market
position and improve their revenues (Donati, 2015). Thus, V. E. is considerably
affected by competitive rivalry. Moreover, F.M. companies are now competing
against each other to create new technologies and provide better services which have
led to the constant growth in the industry (Jones, 2015). V.E.’s main competitors are
Spie and Mitie as they have a great deal of experience and are currently employing
the very latest technology to expand their business. However, both Spie and Mitie are
both concentrating their business in London and other locations so this means that
V.E. have more chance to collect contracts locally, especially in Huddersfield and
Barnsley, the latter location being where their Head Office is based. Therefore, the
G.C. Group have concentrated on assisting V.E. to acquire more contracts locally in
these areas.
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Competitor Analysis Barnsley
Services CompanyVital
ElementBarnsley
NorseEclipse TC B38 Group
GroundRepairClean
PremisesDécor
Pest ControlCatering
Huddersfield
Services CompanyVital
ElementK2 Jenoli KJB
GroundRepairClean
PremisesDécor
Pest ControlHandyman
services
The two tables above show the competing companies in Barnsley and Huddersfield, all
offering different services. In Barnsley, there is only one company that is competing in
ground service and pest control so there is a chance for V.E,’s expansion in these two
services whereas in Huddersfield the competition is greater as there are several companies
that offer most of the services that V.E. provides, apart from the ground service. V.E. can
offer this to new clients, by reaching the decision-makers in these two councils and can make
an effort to visit more potential clients. Therefore, there is a greater chance that V.E. could
increase its revenue here.
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STP (Segmentation, Targeting and Positioning)
Figure 5- STP Framework (Gbadamosi, et al., 2013)
Segmentation
Dividing the market into the different groups of people or buyers with the different manners,
characteristics, and needs, because they might need distinct products/ services, this is called
the market segmentation (Kotler, et al., 2008). Segmentation is done by dividing the different
variables Demographically, Geographically, Psychologically, Behavioural etc. (Gbadamosi,
et al., 2013).
After researching the organisational goals of VE, GC group did the segmentation
demographically and geographically. Demographically, in education sector the schools,
colleges and universities are divided and geographically VE’s strong areas are chosen which
is Barnsley and Huddersfield. Findings have showed that the surrounding areas of VE’s
office are covered by local schools; which is really a great opportunity for the company. The
educational sector needs to present a professional background through its working facilities.
Targeting
Targeting is the process of identifying and selection of the segment which is to be prioritize
for selling the product/services of a company and satisfying the needs of those particular
buyers (Dibb, et al., 2001).
According to the G.C group’s research and the requirements of the VE, the group selected the
target markets which are primary schools both Public and private. The selection of schools
will help the company to focus at those particular areas in which company is already involved
and doing a really good job according to the group’s research with the existing clients.
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Positioning
Positioning is defined as the planning or crafting the image and product offering of the
company in a very unique and a meaningful way in the minds of customers that they find it
really beneficial and really competitive from the company’s point of view also (Egan, 2007).
According to the GC group’s research, VE needs to position itself in a unique way by
creating its Unique Selling Proposition by providing the Service Level Agreement with no
extra costs For e.g., If company is installing a boiler in a school. It agrees to provide services
needed without any extra cost. And also by providing flexible and tailored contracts for e.g.,
if a school want to do a trial contract with the company instead of getting in a long-term
contract then the company can offer short-term contract for them. The VE can get the
competitive edge through these types of offerings.
Marketing Mix Seven P’sProfessor Neil H. Borden firstly used the term ‘Marketing Mix’ (Jain, 2010). It refers to a
combination of Product, Price, Place and promotion, they are often called as the 4Ps (Lamb,
et al., 2012). Boden expanded the 4Ps into the 7Ps which are Process, Physical Evidence and
People. After selecting the target market, the company uses marketing mix to derive the
marketing tools to influence buyers (Kotler, et al., 2009). GC group will use the 7ps to
demonstrate what VE has to offer in the market and based on what criteria the business tool is
applicable to the client request. The model is explained in detail on the section below.
Figure 6- The 7Ps of Marketing Mix (Kotler, et al., 2009)
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Product
Product/service can be tangible or intangible they are created to satisfy the consumer’s needs.
The company must have the right kind of product for its target market (Smith & Taylor,
2004).
Vital Element offers five different key product/services i.e., Repairs, Premises, Grounds,
Cleaning and Décor (The Vital Element, 2015). And according to the research done by the
GC group the most preferred service is the ground service. Also other preferred services
within schools are cleaning, maintenance, and repairs. VE’s current product offering consists
all these preferred services, and the company should emphasis more and more on these
services and make them better.
Price
Price of any product is its value in the terms of money, which helps in exchange of goods and
services. Implementing the pricing policy helps in fulling the market needs. Pricing of a
product depends on cost, demand and competition (Jain, 2010).
From our primary research, we found that pricing of services provided by VE are very
reasonable for its existing clients. As a new company VE has established a competitive
package through its services as existing clients are satisfied by the price and the service.
Although all the schools that GC group has approached mentioned that before deciding to
invest about the School buildings Facility managers always compare prices that suit their
requirements.
Place
Place means the distribution channels (Randall, 1993). Basically it is the activity which is
done by the company to make the product/service available to its target audience. Under
Place, things like Coverage, Locations, Transportation, Logistics etc. is covered (Kotler &
Armstrong, 2006).
VE is located in two places (Barnsley and Huddersfield) from where it operates and both
these areas can be covered really easily (The Vital Element, 2015). Because of this VE
provides swift services to its customers. Right now in both that areas VE is strong and easy
accessibility to its customers is making them satisfied.
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Promotion
In simple words, promotion means the activities chosen by the company to communicate the
values of the product to their target audience and motivate to them buy the product (Kotler &
Armstrong, 2006).
This communication method can be achieved by introducing skilled sales team who are
responsible for promoting and selling the services to existing or potency clients. At the
moment VE has used a promotional tool its own website and social media. According to two
different examples from existing clients of VE’s, an 18 month old client mentioned that she
has no idea that the firm offers other services which means promotions done by the company
are weak. The second client has recommended VE for its quality services to another school.
This is a Word-Of-Mouth type of promotion coming from current clients who recommended
VE to others. Also Managing Director of the company Mr. Nick Calcutt is a Vice Chair
Governor, the advantage of that role is that he can increase his public relations with the
schools by attending various meetings with them.
People
Inside and outside any person who are involved in any part of the activity of the selling the
product or purchasing it comes under this. People includes all the employees, customers and
any contact of the customer to the other potential customer (Tracy, 2015).
Using skilled employees for the firms overall goal is a marketing method which can boost the
performance of the company. People who are involved in the business must be focused to
accomplish the targets of the firm. Employability is very important in marketing as people
can be used as generator tool that are able to deliver good services. The firms needs to hire
skilled individuals who are willing to learn and able to perform under pressure. By
identifying key people who believe in the services that the company offer, it is likely that
those people will perform the best they can. In terms of growing the business people involved
can be assumed as internal competitive advantage and the satisfaction of the people i.e., the
customers which are the external people.
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Process
Process means the services provided by the company and who is delivering the service is the
most important part as their behaviour will make a customer satisfied. Because issues like the
feedback given to the customers, the waiting time, and how helpful were the employees while
talking to the customers are really important (CIM, 2009).
The structure of the company has to become more selective at first point, the educational
sector that GC Group has determined is believed to be a good start for the business growth.
Although the group has limited information regarding the processes of the company, however
every existing client is currently happy with payments and organisational time frames which
fulfils the criteria of effective running company.
Physical Evidence
The service can only be experienced once it is delivered. This is really risky for the customer
because of the intangible nature of the services provided. This risk can be reduced only by
telling and educating the people properly and helping them in ‘seeing’ what they will really
buy (CIM, 2009).
According to the service industries the reputation VE is a small innovative company that
needs to deliver a structured marketing plan. Comparing the years of establishment and
experience other competitors such as Mitie, Spie and Hochtief control a wide range market
by using their branding. A large amount of people automatically recognise the above names
as specialists in the market place and in the FM sector. Vital Element has not built a strong
reputation yet which makes the brand less visible. On the other hand though existing clients
at local areas are satisfied by their services which increases the opportunities to grow more.
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4.2 Primary data
Questionnaire findingsNow, we will analyse the information from questionnaires in the graphical form.
Repairing Cleaning Renovaiton Maintenance Grounds Serivces0
2
4
6
8
10
12
14
16
18
Important Services
No.
of S
choo
ls
This bar graph compares and contrasts how various schools responded when asked to rate the
importance of F.M.’s five main services namely, repairs, cleaning, renovation, ground
services and maintenance. Overall, it can be clearly seen that the highest number of schools
(i.e. 16 out of 20) considered repairs, cleaning and maintenance to be the most important
services. These schools rated them as ‘’Very Important.’’ Meanwhile, other schools rated
these services as just ‘’Important.’’ When questioned about cleaning, four schools reported
that their opinion on this subject was completely neutral. This is somewhat strange, as
according to Health and Safety regulations in the U.K., it is essential that a school should be
kept clean to ensure that the children’s health is not adversely affected. Not surprisingly,
Only 12 schools considered renovation and ground services to be ‘’Very Important’’ whilst
the remaining eight marked them as just ‘’Important’’.
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Agree Neutral Disagree02468
1012
4
12
4
Is FM costly ?
No. of schools
This bar chart illustrates the opinions of schools regarding the cost of Facilities Management.
The first thing to note is that an equal proportion of schools (i.e. 20%) agreed and disagreed
as to whether F.M. was costly or not. It can be clearly seen that the highest proportion of
schools (i.e. 60%) reported that their opinion on the subject was neutral.
Spie Hotchief Mitie Vital Element Others0123456789
No.of schools using services pro-vided by different FM companies
No. of schools
The above bar chart shows different FM companies that are used by a number of schools that
had been given a questionnaire to complete. According to the results of the questionnaire, as
can be seen on the chart, the most used company was Mitie, currently being employed by
seven schools. By contrast, it can be seen that Spie has contracts with only three schools.
Only one school reported that they employed Vital Element. The remaining schools
answering the questionnaire stated that they had contracts with other companies or they hired
independent workers when needed.
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Yes No Can’t say0
2
4
6
8
10
12
Does FM help in the Managing of Schools ?
No. of Schools
This bar graph shows how the responses of schools varied regarding their opinions of FM as
an effective aid in their managing. It can be seen that 12 schools felt that FM could help in
their day-to-day management. The other remaining schools questioned were unable to predict
the usefulness of FM and gave the ’response ‘’ Can’t Say.’’ A final point to mention is that
not a single school reported that they felt FM was not helpful.
Yes No Can’t say0
1
2
3
4
5
6
7
8
Single service provider ?
No. of Schools
Turning to the above bar graph, it can be clearly seen that an identical number of schools
agree and disagree regarding the advantage of employing only one FM company to provide
all the services for them. A considerably smaller number of schools (approximately 50% less)
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were unsure whether or not it was the best option to employ a single service provider. These
schools gave the response ‘can’t say.’’
Satisfied Not satisfied Can't say0123456789
10
Satisfaction of Schools re. FM Services
No. of Schools
The bar graph shows the satisfaction level of the schools questioned regarding the F.M.
companies they were using. The vast majority were not satisfied with the current F.M.
Company with which they were dealing. 60% of the schools reported that they were satisfied
with the company they had employed. The remaining 30% of schools reported that they were
unsure about their level of satisfaction and their response was ‘’Can’t Say.’’
InterviewsFor the project, face-to-face interviews provided in-depth information. The G.C. Group
interviewed ten schools in Barnsley and five in Huddersfield. The interviews were intended
to be unstructured and free-flowing in order to allow flexibility in answering questions. Thus,
more insights were gained about individuals’ opinions regarding the services that are offered
by F.M. companies. Also, more knowledge of possible prospects was obtained as it could be
discovered how different companies were chosen and what motivated the decision-makers.
We also found out about the level of the demand for F.M. in schools. The key questions in
the questionnaire were based on an attempt to investigate the way in which price affects
decision making.
Focus Group: The interviews were conducted with people who could exercise power
and were responsible for making decisions in schools regarding F.M. services. We also
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interviewed a representative from the Local Authority who was responsible for choosing
F.M. companies for some state schools in Barnsley.
Disadvantages
The main limitation of conducting face-to-face interviews was that it was time consuming.
The G.C. Group had to book appointments with responsible individuals within the
organisations, but this proved difficult as these people had very little free time. Also, due to
the project taking place during the summer holidays, many schools were closed. The cost of
travelling from Leeds to Barnsley and Huddersfield was expensive. This led to geographical
constraints as visiting schools in multiple areas would have been more time consuming as
well as resulting in increased cost.
Telephone InterviewsExisting Client Telephone Interviews
Ground Repair Clean Décor Premises0
1
2
3
4
5
6
Schools using services from Vital Element
No. of Schools
This bar graph shows how popular V.E.’s ground services have become. Even if schools are
using other companies for other services, it would seem that V.E. has gained a good
reputation for providing excellent ground services. It is very disturbing however to see that
none of the schools questioned were employing V.E. to provide them with any of the other
F.M. services. Maybe V.E. should launch a new advertising campaign to raise awareness
about their other services in order to gain more contracts to provide these other services.
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Yes No0
0.51
1.52
2.53
3.54
4.55
Awareness about other services
No. of Schools
The responses to the questions asked during the telephone interviews with a selection of
V.E.’s clients, as shown on this bar graph, would seem to suggest that whatever advertising
campaign V.E. has previously launched, although it may have made potential clients aware of
the company’s existence, it was not successful in encouraging these individuals to book the
company to provide other services. Therefore, it is necessary for V.E. to rethink their
advertising campaign to make it more successful.
Not Required Not aware012345
Reasons for not using other services
No. of Schools
When answering this question in the telephone interviews, only a small proportion of V.E.’s
clients stated that they were not aware that V.E. provided other services. As can clearly be
seen from this graph, the vast majority of V.E.’s clients claimed that they did not require any
other services. Again, this would seem to suggest that V.E.’s current advertising campaign is
not sufficiently persuasive to make potential clients realize the importance of their other
services or the high standard of all the services that V.E. can provide.
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Summary of findings from the VE’s Existing ClientsGC group contacted 8 existing clients of the VE and 6 of them replied. In those 6 clients, VE
is working with most of them for the long time and they all are satisfied with the services
provided by the company. And the most used and loved service of the company is the Ground
service as all the clients that were contacted use this service. Also the Managing Director of
the company is the one who makes the communication with their every client. After asking
about the awareness of the other services the group came to know that one of the school
didn’t know about the other services provided by the company and all the others are aware
but they all have different issues about why they are not able to use the services. And all of
the schools are very happy with the pricing and the quality of the services provided it is in
time with no delays. When asked for the recommendation, the clients had no comments but
some of them recommended that the company should contact more school and wanted to
know more about the company. (See Appendix 2)
5. ConclusionThe Vital Element is a small business which fulfils the criteria of business growth. On the
basis of research, the G.C. Group has pointed out that V.E.’s current position is ineffective
and has suggested how the company should make itself more visible to its target market, i.e.
the educational sector. Schools near the operational departments of V.E. seem to be
untouched as the schemes are so small. Although the company’s management has attempted
to attract the attention of these schools, the decision to select the educational sector as the
main target market was made by the G.C. Group’s Research Methodology. Visiting schools
has enabled the group to get a clear understanding of how an F.M. company can enter the
market by offering different services. Structuring key questions for the school managers to
answer has given the G.C. Group the opportunity to research the way in which Local
Authorities have such a big impact in terms of selecting registered companies to manage their
schools. There is a need for Mr Nick Calcutt (Managing Director) to fill in the form for the
official Journal of the European Union as this is the essential document that enables F.M.
companies to get included in the list used by the L.A. The disadvantage of this market is that
the actual decision maker for any state school is the L.A. which seems to control every action
in terms of managing the service of each school building. However, this does not mean that
V.E. is not able to enter these state schools. The G.C. group managed to contact one
department of the L.A. It was explained that such information could only be given directly to
the owners of companies. Results cannot be achieved within a short period of time, due to the
36 | P a g e
large amount of paperwork and procedures are to be considered and each involving specific
departments of the L.A. VE’s grounds and cleaning services are currently the most popular
services and they enable the V.E to generate more revenue. The G.C. Group has suggested
that V.E. should focus on those services which are essential to every school. Extending their
client portfolio by offering these services will create a good reputation for the company and
increase its visibility. Finally, the customer satisfaction of this particular market could
increase the number of clients as most of the local schools are connected with each other.
Two more schools have already been added to the existing client portfolio as V.E.’s services
were recommended to them by another local school, thus proving the power of mouth to
mouth communication. If this traditional method of marketing continues alongside all the
new strategies recommended by the G.C. Group, it seems that there is a good chance of V.E.
reaching the target of Five million in next three years that is by the end of 2018.
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6. Recommendations and Marketing Plan
On the basis of research and our findings GC group has come with the following
recommendations. This recommendations are in line with the Aim and Objectives of this
project and will help Vital Element to achieve its desired goals in coming three years.
Personal selling The Vital Element can take the advantage of personal selling as it is the most powerful
promotional method due to the fact that it is two-way communication. It can adjust the
message and gain feedback at same time. The other advantage of this method is that it helps
in building relationships with potential customers. So, it is recommended to do personal
selling for the customers who are not easily attracted through other methods like sales
promotion, PR, advertising etc.
Business development executives (BDE)
To take the advantage of personal selling we suggest VE to employ an experienced
business development executive who will take care of day to day marketing activity. We
understand the fact that, initially it will be costly to hire such expertise so, we suggest to
employ BDE on short-term contract basis. The reason behind this recommendation is that
during our research we found two potential clients for Vital Element (see appendix 4). This
indicates that there is an opportunity for the company to get clients through personal selling.
Creating awareness During our research we found out that the majority of the potential customers i.e. Schools
were not aware of the Vital Element. One of the existing client Mrs. Sam from Birdsedge
First School in Huddersfield said that they are not aware of other services which VE
Company is currently offering. Based on this findings, it shows that there is need of creating
awareness about the company and its services. The following strategies can be utilised to
create awareness among the potential and existing clients.
Email marketing
This method will allow the company to reach their existing clients without spending
lot of time or money. It is a great way of keeping in touch with them and keep them updated
about other services. The company can also make existing clients aware of any offers and
promotion that might be interesting for them. This will help them to cross-sell its other
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services to existing clients. It is recommended to send regular emails that contains some
valuable contents and not just sales messages to build trust and loyalty.
Direct Mail
This is an old-school method of marketing but it is still very effective method. The
VE can come up with company brochure that will be sent to its potential and existing clients.
This brochure will include the importance and about the companies services in brief. It will
consist of various services that the company offers and why it is the best in the industry. It
will also include some past project with pictures of before and after scenario.
Improving Company website
It was observed be the GC group that the company website is not attractive enough.
To make it more attractive and effective it needs improvement. We suggest the company to
add more testimonials on website and it is also recommended to add specific case studies that
explains about the importance of Facilities management. The website can include some past
works and also some ongoing projects that has been undertaken specially in schools.
Increasing company’s presence on social media
GC group recommend VE to increase its presence on social media like Facebook,
Twitter, and LinkedIn. Having a good social media presence can help the company to create
awareness and also to grow. This can be achieved through various methods like creating
valuable content, showing the correct image on Facebook. This helps in engaging with the
customers, knowing what the followers are saying and also taking feedback.
Ansoff’s MatrixThe Ansoff’s matrix (1979) tool provides framework that helps to make future growth
strategies for any business (see appendix 3). We have used this tools for this project come up
with recommendation that will help the company to grow in future.
Market Penetration – to increase the awareness of ground services in the target
market by means of different communication methods (see appendix 1) as it is the
most preferred services in the schools.
Product development – introducing short term-term contract of current services for
the schools that has limitation over making decisions due to long term contract. This
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will give an opportunity to show the companies skills and will also help in building
good relation and gain client confidence.
Market development – after VE covers all the schools geographically in Barnsley
and Huddersfield it can move to market development. This strategy is to target other
market to provide existing services. For instance, VE can enter into partnership with
letting agencies, health institutes and student accommodation.
Diversification – in comparison to Vital Elements’ competitors it was found that the
company needs to add more services to its product portfolio. To achieve company’s
future growth plan it is recommended to do related diversification. For example when
VE are implementing market development strategies they can introduce services like
handyman services, pest control and catering.
Registering on YortenderIt was very important part of our project to know the procedure of getting listed with local
authority. To reach at Five million turnover in next three years local authority can turn to be
very crucial for the VE Company. After contacting Kirklees Council Huddersfield we found
out that – at kirklees, the council provides an in-house facility management as a part of a
traded service and they would not be putting the services out to tender at the present (see
appendix 5). However, they said that tender opportunities are advertised on the council’s
tender portal called ‘Yortender’ a portal used by other local authorities. So it recommended to
register on Yortender to take the opportunities as they appear. Another, important point to
consider is that County councils are responsible for providing services in educational sector
contacting them will be very useful (GOV.UK, 2015). For contact details (see Appendix 6).
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Appendices
Appendix1 – Literature review
Marketing Communications StrategyCommunication is a continuous process. It is global and also it is a very important feature in
any organisation, Communication means sending and receiving a specific message, figures,
emotions, ideas or values between individuals (Smith, et al., 1999).
Whatever an organisation says or does is a type of marketing communication. Examples of
this include the advertisements a company makes, the products or packages it creates, the
uniform of the employees and also what consumers say or the kind of impression made upon
them regarding the products or the company itself (Solomon, et al., 2009). If an organisation
has to communicate efficiently with their customers, it is very important for a company to
make a promotion strategy. A company communicates with the consumers in order to make
sure that they are aware of the value provided by the organisation. Also, it is very important
to create communications objectives, shape the nature of the message, select the target
audience to whom the message is to be conveyed, and identify the response of the people
(Bradley, 2003).
Almost all the communication activities have the same elements, i.e. a sender with a
communication goal which is then transformed into an encoded message and then it is
delivered through the media to the receiver or the target audience, which then experiences an
outcome, a feedback to the sender of the message. However, the whole process is subject to
distortion or noise (Dahlen, et al., 2010).
Marketing Communications Mix (Promotion Mix)An organisation’s Marketing Communication Mix, (also known as ‘Promotion mix’) includes
a mixture of sales promotion, advertising, personal selling, direct marketing and public
relations. These are used by an organisation in order to achieve their marketing and sales
objectives (Kotler & Armstrong, 2006). The five tools of the marketing communications mix
are:
1. Sales Promotions – This tool exercises a short term influence over customers to
encourage them to buy a specific product or service. It emphasises and supports the
targets of the promotional programme (Kurtz & Boone, 2012). Sales promotions
consist of free merchandising, free samples, coupons, premiums and loyalty cards
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etc., (Dibb, et al., 2006). Other examples of promotions are the giving of vouchers to
students and the offers of ‘Two for One’ meals at local pubs (Solomon, et al., 2009).
Advantages –
Attracts new consumers (Yeshin, 2006) and creates brand and product
awareness (Kurtz & Boone, 2012).
Short-term boost in sales, value and profits (Dibb, et al., 2006).
Provides incentives for the retailers who support the product and builds
excitement in consumers and retailers (Solomon, et al., 2009).
Persuades existing customers to buy more (Yeshin, 2006).
Limitations –
Short term encouragement to buy the product instead of building a brand
loyalty (Solomon, et al., 2009).
Many competing promotions from different companies make it hard to break
through the cluster of promotions (Kurtz & Boone, 2012).
2. Advertising – This is a form of communication which must be paid for. It is non-
personal and is intended to remind or persuade the customers to take some action
(Kaser, 2013). It is communicated through media tools, such as newspaper, radio,
television, magazines and internet etc. Advertising is intended to promote products
and organisations to offset the competitors’ advertisements and to trigger the demand.
E.g. the UK government advertises employment training, road safety and drink
driving awareness campaigns etc. (Dibb, et al., 2006).
Advantages –
It helps in reducing sales variation (Dibb, et al., 2006).
Educates the customers about the product or a service (Dibb, et al., 2006).
The company has control over what message should be conveyed to the
audience (Solomon, et al., 2009).
Limitations –
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People have become savvier and tune out messages that are of less interest to
them (Kurtz & Boone, 2012).
Advertising can be expensive to produce and publish (Solomon, et al., 2009).
It can be ignored by the audience and it may have low credibility (Solomon, et
al., 2009).
3. Public Relations (PR) – This is about establishing and maintaining goodwill by
gaining favourable publicity and making a good ‘corporate image’ and the handling of
bad publicity or rumours circulating in the market (Kotler & Armstrong, 2006). It is
also about creating a mutual understanding between the company and target publics,
such as employees, shareholders, the media, and government (Dibb, et al., 2006).
Advantages –
It costs relatively less than the others communications tools (Solomon, et al.,
2009).
Increases the credibility of the company among the consumers (Kurtz &
Boone, 2012).
With PR it is easy to select and reach the target market (Bowen, 2010).
Limitations –
Less control over the message to be conveyed and no assurance that it will
reach the target audience (Solomon, et al., 2009).
Difficult to track the end results of the task (Solomon, et al., 2009).
It involves efforts which are focused on non-marketing objectives (Kurtz &
Boone, 2012).
4. Personal Selling – This can be defined as the person-to-person communication in
which the salesperson learns about the needs of the customers, and then aims to
satisfy those needs by offering the customer a chance of buying something of value
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(Cant & Heerden, 2004). Personal selling can be done through video conferencing,
over the telephone, face-to-face etc. (Kurtz & Boone, 2012).
Advantages –
Due to the direct contact, salespersons have the opportunity to be flexible and
can modify the message according to the needs of each customer (Solomon, et
al., 2009).
Instant response from the consumer about the product (Kurtz & Boone, 2012).
It enables measurement of effectiveness (Kurtz & Boone, 2012).
Limitations
Depends on the capability of the representative of the company (Solomon, et
al., 2009).
It incurs high cost in contacting the customers (Kurtz & Boone, 2012).
It can also depend upon the goodwill of the company by other marketing
activities (Solomon, et al., 2009).
5. Direct Marketing – This is a form of communicating directly with the consumer or
other business which should produce a request for more information, purchase order
or official visit to the office or warehouse to purchase goods (Kurtz & Boone, 2012).
Direct marketing helps customers to get involved, not only in buying the goods (Egan,
2007). One of the best examples of direct marketing is online marketing. This also
includes direct-response advertising, infomercials etc. (Blythe, 2009).
Advantages –
Consumer needs are identified and can be aimed accurately (Blythe, 2009).
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It produces a quick response from the customer (Kurtz & Boone, 2012).
It is convenient for buyers as it is easy to use and private as it reaches into
their homes where they can browse online catalogues and company websites
(Kotler & Armstrong, 2006).
It is a powerful tool in building a good relationship with customers (Kotler &
Armstrong, 2006).
Limitations –
It costs more than other promotional activities per reader (Kurtz & Boone,
2012).
Consumers may get annoyed by some types of direct marketing (Solomon, et
al., 2009).
Business to Business Marketing (B2B) B2B marketing means practices and techniques used by organisations with products or
services which are sold to other businesses (Brafton, 2015). It includes the retailers and the
wholesalers who buy goods with the purpose of renting or reselling to other customers.
Institutions such as hospitals, charities and all levels of government are also included as
customers in full B2B market (Blythe & Zimmerman, 2005). Some of the leading market
analysts and writers estimate that in B2B activities, an area like e-commerce is 10 to 15 times
greater than the B2C (Business-to-consumer). The significance of B2B marketing has grown
considerably as B2B activities contribute a major part in national economies, Marketers in
B2C activities are learning from the B2B marketing activities. B2B exchanges have greater
impact on people’s lives than B2C activities (Ellis, 2011).
Buying Centre ModelThe Buying Centre Model is also known as the Decision-making Unit. In only a few cases,
the industrial purchasing decisions are made by one person. In small businesses it is highly
likely that many people have an influence on making the purchasing decisions. Due to the
involvement of many people, the decision-making process becomes more formal. Specific
areas of interest will be expressed by different members of the decision-making unit. On a
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company’s organisational chart, this group cannot be recognised (Blythe & Zimmerman,
2005).
The decision-making unit contains the following types of members:
Initiators: These are the people who identify the problem.
Gatekeepers: The flow of knowledge is controlled by these types of people, either by their
collecting the information or by being proactive. These people could be the junior staff or
personal assistants.
Buyers: These individuals are given the task of negotiating the ultimate deal. They are often
the ones who are the purchasing agents who will do the necessary tasks of buying.
Deciders: These individuals will make the final decisions. They may never meet the
supplier’s companies’ representative. They often rely on other members of the decision-
making unit.
Users: These are the people who use the product. They can be technicians or engineers or the
cleaning staff. Deciders sought their opinions and in most cases they can also be initiators.
Influencers: Deciders listen to the influencers. They are the most trusted advisors but
supplying companies find it difficult to identify them. Purchasing firms’ employees are the
influencers. They can be information system managers, engineers or consultants, e.g.
architects or safety consultants. Influencers may be the deciders’ college friends or golf
partners (Blythe & Zimmerman, 2005).
Decision making modelIt doesn’t matter what position someone holds in the company, he/she makes some kind of
decisions every day and, whatever the result may be, this is the outcome of the decisions
made at every point of the whole process (Mind Tools, 2015).
Rational Model
This model is quite normative in that it takes a prescriptive approach instead of a descriptive
one in decision making. In Decision Theory, the Rational Model is a classical approach. Due
to the Rational Model, some people see decision-making as really quantitative because it
provides the basis for the quantitative order of mathematics, economics and statistics
(Harrison, 1993). There are six steps in this decision-making process: -
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1. Description of the problem
2. Identification of the decision standards
3. Assignation of weights to the standards.
4. Start of developing the alternatives.
5. Evaluation of the alternatives
6. Selection of the best alternative (Robbins & Judge, 2013).
Intuitive decision-making
This type of decision-making is the least rational way. This is created from a distilled
experience and is an unconscious process due to the fact that it comes from outside all
conscious thoughts. Also, while intuition is not a rational process, it will not necessarily be
wrong. Also it is not superstitious. It is being recognised that rational decision-making is
over-emphasized and, in some cases, intuition decision-making can result in better decisions.
However, people should not rely on this process too much because it is really hard to know
whether it is right or wrong. Nevertheless, one should not abandon this process although one
should not rely on it completely (Robbins & Judge, 2013).
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Appendix 2 – Questionnaires and Interviews
Questionnaires
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Telephonic InterviewsQuestions for existing Clients
1) How long have you been working with Vital Element?
2) What services is the company providing at your premises?
3) Who approach your School?
4) Are you aware that Vital Element specialises into other services?
5) Why you are not using other services?
6) Are you satisfied with VE pricing packages?
7) How do you feel about the quality of service?
8) Do you have anything to recommend for VE progression?
School 1
Primary Contact: Lorraine Baker- Alternatively GC Group has spoken with Mrs. Sam due do
the busy time scale.
Birdsedge First School
Penistone Road
Birdsedge
Huddersfield, West Yorkshire
HD8 8XR
Main 01484 222714
Main [email protected]
Answers:
1) Our school is working With Vital Element for the Last 18 months.
2) Gardening services.
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3) Mr. Nick Calcutt has sent us an email about his company so we have arranged an
appointment regarding our requirement.
4) She has no idea that VE specialises into other FM services.
5) We didn’t know about that, however our school is very small so probably that’s why.
6) Very happy with the pricing.
7) Response is quick, Service is delivered on time, Reasonable prices and flexible
service.
8) As a local Business I would recommend them to find to more Schools to offer their
services. Also Mrs. Sam wants to learn more about the company as she assumes that it
is very well build and organised.
School 2
Primary Contact Cath Sanderson
Bywell CE (C) Junior School
Bendigo Road
Dewsbury, West Yorkshire
WF12 7LX
Main 01924 460666
Main [email protected]
Answers:
1) VE has worked with our School for one year.
2) Ground Services.
3) Mr. Nick Calcutt (Vice Chair President) saw the school request and contact us.
4) We are aware, although we have other FM providers within our School.
5) Currently the School is not interested for any other offers or packages.
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6) Very Happy.
7) There are no complains, Quick response and no delays.
8) VE charged quite high, although the high quality service explains why.
School 3
Primary Contact: Marina Davis
Cumberworth CE First School
Cumberworth Lane
Upper Cumberworth
Huddersfield, West Yorkshire
HD8 8NU
Main 01484 222726
Main [email protected]
Answers:
1) We’ve got 18 months contact with Vital Element.
2) Ground Maintenance-Cutting Grass.
3) The managing Director of VE has send us an email.
4) Yes, absolutely we do know that there are other services available.
5) At the moment the School doesn’t need any other facility services.
6) Yes we are very happy with the service and pricing.
7) Excellent organisational skills.
8) Nothing to recommend.
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School 4
Primary Contact: Susan Mallinson
Dalton School
Mayfield Avenue Dalton
Huddersfield, West Yorkshire
HD5 9HN
Main 01484226577
Fax 01484226578
Main [email protected]
Answers:
1) The School works since March with Vital Element.
2) Grass Maintenance.
3) St Judish catholic School has recommended to Mrs Susan to approach VE
management.
4) Yes she is aware, although local authorities decide about Facilities management
activities. In terms of School budgeting School members are not authorised to make
any decisions before informing the local authorities.
5) Not at the moment.
6) Competitive pricing.
7) An organised local business with a long term future.
8) No comment.
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School 5
Primary Contact: Judith Heppenstall, Main [email protected]
Hade Junior & Infants School
Greave Road
Hade Edge
Holmfirth, West Yorkshire
HD9 2DF
Main 01484 222470
Answers:
1) We are working for two years with Vital Element.
2) General Ground Maintenance –Grass.
3) The School has approached VE as I was suggested from another school called
Londley’s School.
4) Yes we are aware of the other services.
5) At the moment the school is not interested for any other services.
6) Very happy with the pricing-reasonable.
7) Very good timing, always responsible professionals.
8) No comments.
School 6
Primary Contact Ms. Jackie Oldham
Meltham CE Primary School
Holmfirth Rd
Holmfirth, West Yorkshire
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HD9 4DA
Main 01484 222610
Main [email protected]
Main [email protected]
School 7
Email:
Primary Contact Ginny Wood
Salendine Nook High School
New Hey Road
Huddersfield, West Yorkshire
HD3 4GN
Main 01484 657541
Fax 01484 460579
Other 01484 489989 GW
Main [email protected]
Main [email protected]
School 8
Primary Contact Jeannette Marsh
St Joseph’s Catholic Primary School
Grosvenor Road
Dalton
Huddersfield, West Yorkshire
HD5 9HU
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Main 01484531669
Main [email protected]
Answers:
1) We are working with Vital Element for the last three years.
2) They managed the ground maintenance, although recently a fire risk assessment was
held by VE’s management.
3) By using the word of mouth Mr. Nick has approached the School by sending an
email.
4) Yes they are aware that VE offers more services.
5) Mrs. Janette Marsh gets authorised to use the available budget of the School, at the
moment they do not need anything.
6) Very Happy.
7) Always on time, Flexible with the School priorities and events, informing any
changes by telephone or email.
8) VE has been selected to manage the ground maintenance contact after being
compared with two other companies which seems to be the best choice for our school.
However the company seems to be very competitive with others as their pricing
portfolio is similar with local competitors.
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Appendix 3 – Ansoff Matrix Igor Ansoff invented Ansoff matrix. It is a strategic tool that provides a framework to create
strategies for future growth. This matrix is used to identify the risks related with the new
business directions taken for future growth of the company. When a company needs to work
on new and existing product or market, the Ansoff matrix is used to model the product and
market risks that help in taking growth plan decisions (Donald & Waters, 2006).
(Ansoffmatrix.com, 2013)
Market Penetration - This strategy focuses on the products, which are already there in the
existing market. According to this strategy, existing products can be further exploited without
changing the whole product by various promotional and pricing methods (Campbell, et al.,
2011).
Product Development - In this growth strategy, new products are launched into the existing
market. There are two methods of launching products in product development (Campbell, et
al., 2011), which are Launching whole new product in existing market and Modifying
existing product and launching them in the existing market (Ansoffmatrix.com, 2013).
Market Development - In this strategy, the company chooses a new target market but the
products sold in that area are old or existing products. This is done after assuming that the
existing markets have been fully exploited thus the company needs to enter new markets by
market segmentation and identifying new client portfolio (Pierce, 2009).
Diversification - This is the last growth strategy of this matrix. In this growth strategy, the
company has to choose new target markets and launch new products. The new field in which
the company wants to diversify can either be related to existing products or to totally new
sector, which is unrelated to existing product (Donald & Waters, 2006).
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Appendix 4 – List of potential clients
Batley Grammar School
Carlinghow HillBatleyWest YorkshireWF17 0AD
Telephone: (01924) 474980Fax: (01924) 471960Email: [email protected]
Summer lane primary school
Summer lane, Barnsley
South Yorkshire, S752BB
Tel: 01226205363
Email: [email protected]
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Appendix 5 – Email from Kirklees council
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Appendix 6 – Contact details of County Council
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