Planning for Growth in CafePod Coffee Co

This report provides an analysis of growth opportunities, sources of finance, business plan, and exit plan for CafePod Coffee Co. It also includes an evaluation of competitive advantages and sources of finance.

Planning for growth

Contents
Contents...........................................................................................................................................2
INTRODUCTION...........................................................................................................................1
MAIN BODY..................................................................................................................................1
TASK 1............................................................................................................................................1
Evaluation for the growth of the company..................................................................................1
Understanding competitive advantages.......................................................................................4
TASK 2............................................................................................................................................5
Sources of finance........................................................................................................................5
Evaluation of sources of finance..................................................................................................6
TASK 3............................................................................................................................................6
Business plan...............................................................................................................................6
evaluation of business for the company.....................................................................................10
TASK 4..........................................................................................................................................11
Exit plan.....................................................................................................................................11
Evaluation of the exit plan.........................................................................................................13
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................15

INTRODUCTION
Planning for growth is the strategic activity planned by business and organisation in order
to increase their growth in the market (Affia, Akang and Aniefiok, 2020). Through this company
can track their organic growth in their revenue. A proper strategic planning helps in preparing
realistic vision for the future growth of the business and maximises with their potentiality for
successful growth. CafePod coffee co is the independent craft coffee business which was
established in 2011. The report will provide an analysis in context to small and mid-size to
evaluate the growth opportunity, sources of finance, a proper business plan for growth and exit
plan. As company needs to enhance the operations and need to take the growth for establishing
in the market. Planning for growth will provide various benefits to the company for making
strategies and decisions in favour to increase the growth of the company in the market.
MAIN BODY
TASK 1
Evaluation for the growth of the company.
For evaluating the growth opportunity of the CafePod coffee co there various analysis through
the company can understand the market analysis by internal and external analysis and various
others framework in order to understand the market. Which are mentioned below.
Pestle analysis
Political- There are various political issues that might affect the coffee industry. The
company needs to take into consideration for every law.
Economical- There are several economic laws that might affect the growth of the
company. The business is minor depend on the economics of the country.
Social- There is constant changes in market trends in terms of the preference and living
standards of the customers which might affect the CafePod.
Technological- There are constant changes in the technology which organisation needs
to take into consideration in their operation process. And there is technology which might be in
benefit of farming the raw materials (Bhattacharya and Bhattacharya, 2021).
Legal- there are several rule, regulations and laws which might affect the company
growth.
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Environmental- As there are various laws by government for environment. In context to
CafePod, as they are already organic harvesting and farming.
Strength- The Pestle analysis helps in understanding the external market for the company and
provide an opportunity ton grow in the market.
Opportunity- Through the analysis CafePod can analyse new technology, latest market trends in
order to grow in the market.
Porters five analysis
Bargaining power of buyer- As there are various organisation that offer uncanny products
as CafePod coffee co. So, the bargaining power of the buyer is high (Boyd and Ronnie, 2021).
Bargaining power of supplier- As company is buying raw materials from different
sources and is providing organic products to the customers this gives benefits to the company to
bargain with the supplier. But there are various other big established brands in the market with
the supplier is dealing. Hence, the bargaining power of the supplier is moderate.
Threat of substitute-there are various other big brands who provides similar products in
the market and they are well established in the market. Hence, the threat of substitute power is
high.
Threats of new entrants- As it is not difficult to enter into beverage industry as does not
require any major capital, but the company well known in the market so, this might not affect the
company. Hence the threats of new entrants are moderate.
Exiting competition- there are big beverage company who has a strong establishment in
the market, which gives existing competition high.
Strength- This analysis will help in identifying the competitors and market in order to make
further strategies.
Opportunity- With this analysis CafePod Coffee co can bring new innovation and strategies in
the market.
VRIO analysis
Valuable- The special flavours, taste and authentic coffee are the most valuable for the
CafePod. The environment and atmosphere of the café are valuable to the brand.
Rare- The resource is rare for the brand, which make the products high quality and
delighted. Their products quality, taste and flavours are rare for the company.
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Imitable- As the flavours, taste and quality can be imitable. The environment and
ambience are not imitable (Cardoso and et. al., 2020).
Organised- The authentic taste, flavours and process is well organised by CafePod. the
environment and surrounding are also well organised by the organisation.
Strength- From this analysis the CafePod can identify internal analysis in order to make
decisions to develop the innovative ideas.
Opportunity- With this analysis the company become market leader.
SWOT analysis
Strength- The brand image of the company is its strength. There proper recipe is their
strength, through which they attract loyal customers.
Weakness- The company has limited share in the market in order to deliver the products.
The competition in the market is high.
Opportunity- There are various new opportunity for CafePod to grasp such as, new
technology to grow and operate smoothly.
Threats- There is major threats from competitors such as, Starbucks, Dark arts coffee
and Marshfield bakery (Chen and Voigt, 2020).
Strength- From this analysis the company can identify its strengths and weakness to make better
decisions for growth in the market.
Opportunity- With this analysis CafePod can identify several opportunities that can develop into
operation. This enable company to identify the long-term vision.
Porter generic framework
Cost leadership theory- Company can decide on cutting various cost of manufacturing.
It will help CafePod to reduce the price for competitive advantage in the market.
Differentiation theory- The CafePod, firm can need to concentrate on increasing the
target market in order to fulfil their needs. This way, the company will enable for making a
position in the market.
Cost focus theory- In this the industry will able to focus on the selected niche market,
along with fulfilling the needs and demands of the customers. This was it will help the CafePod
to grow by focusing on the niche market.
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Differentiation focus theory- This strategy allows company to focus on the preference
and needs of the customers. This allows CafePod for focusing on the niche market to understand
in order to provide the growth opportunity.
Strength- This analysis provides an effective technique for reducing the cost.
Opportunity- It identify market trends customers and various opportunity to grow in the market.
Ansoff matrix
Market penetration- This refers to the company to allows its market for offering the
products and services in existing market. This will allow company to attract more customers.
Advantages This strategy will allow CafePod to enhance its sales and profits through developing
inn existing market.
Disadvantages- Through this strategy company might even lost their loyal and old customers if
the plan did not affect well.
Market development- This strategy suggests company to develop and establish the
business in new market. As CafePod can establish its business outside the UK with proper
stability and capability (Doss, 2021).
Advantages- The strategies provide an opportunity to grow in different market and provide
various benefits regarding foreign investment.
Disadvantages- With this strategy there are various risks that might affect the company and it is
time and cost consuming process.
Product development- This strategy suggest company to offer to new products and
services in existing market. Company can enhance the taste and quality of the products in order o
grow in the market.
Advantages- It will provide various opportunity to CafePod in order to develop the new products
to increase its operation.
Disadvantage- The biggest disadvantage for the company is that it will avoid competitors and
will only focus on the strategy.
Diversification- This strategy will suggest that company needs to develop new products
on non-existing market. But it has more risk factor involved new products of the company in
order to establish in the market.
Advantages- It provides various benefits in order to enhance growth in wide market.
Disadvantages- There are several risk involved in this strategy.
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Understanding competitive advantages
In context to CafePod coffee Co. for developing the growth in the market. Company can
enhance its position in the market through developing several strategies from the above such as
product development. As it will help in establishing new brand image in the market an\d attract
more customers.
TASK 2
Sources of finance
Bank loans and overdrafts- This is a flexible funding method with instant access. Small
bank loans do not require collateral, but when a company raises large amounts of money, it must
post some form of collateral. Then pay interest to the bank.
Advantages:
 The main advantage is that it is easy to arrange and the owner has to pay a certain amount
of interest.
 Companies can raise large sums of money for large projects from this source.
Disadvantages:
 If the owner exceeds the overdraft limit, the bank will charge a certain amount and the
company must meet the deadline to repay the loan (Ghobakhloo and Ching, 2019).
 Small businesses may find it difficult to borrow money from this source.
Savings and friends- These are the most trusted resources. They offer low-interest rates.
However, relatives and friends should be informed that the investment may lead to losses.
Therefore, there is mutual trust to help each other, which is financially motivated.
Advantages:
 The company has the advantage of paying little or no interest.
 The company can obtain appropriate support and advice from friends and relatives for
success.
Disadvantages:
 Company may lose money or go bankrupt.
 Conflicts may arise between family members.
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Retained earnings- These are related to the company’s cash flow. This is the net income
from sales after all dividends have been paid to shareholders. They can borrow quickly and
easily and do not have to bear interest.
Advantages:
 The best thing about this resource is that it helps create business stability with financial
stability.
 It is easy to start up a company because there are no unnecessary procedures.
 It is an easy, convenient, interest-free source.
Disadvantages:
 The downside of this is that shareholders may not value the option because they want a
better return rather than reinvesting the money.
 The company may not be able to use this fund due to future uncertainty.
The company needs to obtain a large amount of money using bank funding sources. Bakeries are
also free to operate using its internal reserves and do not have to pay interest (Haider and
Tehseen, 2022).
Evaluation of sources of finance
This allows company to identify various sources of fiancé through which CafePod coffee
co can develop their new strategies and enhance its establishment in the market. From the
options above it is clear that there are several options available to the company. A company can
use various sources of funding. Retention or Savings or Friends. CafePod Coffee Co can create a
source of retained earnings for the business. It helps companies to have smooth business
operations and functions while expanding their business in other markets
TASK 3
Business plan
Organisation name- CafePod Coffee Co. is the chosen organisation for business plan.
Summary- It is a private enterprise of that deals in coffee pods, capsules and granules.
Background of the company- The company was developed in 2011.
Vision- the main vision of the company is to provide premium quality coffee to the
coffee lovers.
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Mission- the main mission of the company is to provide coffee to each coffee lover
customers.
Objective- the objective of company is to build a strong brand reputation in the market.
Products of the company- the main products of the CafePod are there premium quality coffee
grounds and their coffee pods.
Stakeholder- Stakeholders investing in companies are governments, investors, shareholders and
suppliers. These stakeholders are the important for the organisation and will directly or indirectly
influence the business. Employees, suppliers and managers are CafePod internals who can
contribute to success of the company. They define strategies and plans to create systematic
workflows within the organization. External stakeholders such as shareholders, governments and
investors need to be financially stable and invest more in innovation, diversified product lines
and achieving their goals (Irfan and Wang, 2019).
Capital- the capital that is being required by CafePod for establishing business in Spain will be
around £15k. for doing this company might needs sources of finance, for that CafePod can
acquire bank loans. The company ought to without difficulty provide loans shape banks because
of having meaningful goal and recognition into market. Short time period investment are
constant deposits or financial institution loans. These budget most closing for 1 year. Long time
period budget reassets are retained income and overseas direct investment. So, the bakery desires
to acquire
each supply for accomplishing long time commercial enterprise growth.
Target- the turnover of the company in first financial year should be around £55k and the
revenue of the same year should be around £30k.
Operational plan- Company can develop the organisation function within the business as it is
establishing in new market. Company might require to hire 20 employees in beginning and need
to take decision and set committee to discuss further strategies.
Resources- The company needs to focus on developing several resources for operation. Also,
company needs the raw material with the best quality and organic in order to attract customers.
Organisation needs infrastructure, ingredients, packaging material and monetary funds.
Technology- According to CafePod Coffee Co's goal, the company requires modern technology
to contribute to the supply of organic food. Technologies like digital tools, SEO, cloud
computing. These will help attract large customers, understand their needs and wishes. Digital
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marketing, SEO are necessary to create awareness among customers among green products
through online promotion, digital portfolios (Lee and Jung, 2020).
Risk factor- According to the UK government, employees must comply with safety and hygiene
regulations. Coffee grounds should be organic. If its labelling and information is not done
correctly, the company can be reported under the Food and Safety Act. There is also the risk of
food waste which, if not disposed of properly, destroys the environment. Café and other staff
should be trained in a set of instructions and practical lessons, failure to do so could result in a
serious fire hazard. Therefore, the bakery must be insured for this case so that it does not lose its
business (Oxford Analytica, 2021).
Marketing plan-
 The target market is Spain, Europe within which the corporate is progressing to reach
them through therefore the discounts in beginning, so low value for feat clients.
 The selling set needs to be included promotion by advert and on-line platforms. As the
company is launching their search and products in new market and needs to take
customers response by social media like Websites, Facebook. Instagram and twitter.
 The CafePod café desires to attain 5% rise in sales through social media strategy. they're
going to sell free sample of organic bars and candies to attract customer.
Timeline- The time duration that is set for achieving target is 1 year.
Gantt chart-
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It characterizes to a chart which presentations horizontal line series which describes the quantity
of work done or goods manufactured in a specific time period directly comparing to the quantity
which was planned earlier for the particular period (Otles and Sakalli, 2019).
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SWOT-
Strength-
 Company do better when they enter a new market since the company develops a new
taste relative to the competition.
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 They hire highly skilled workers.
 They successfully develop new items.
Weakness-
• There is little investment in research and development.
• Inability to successfully integrate businesses into different working cultures.
• Aside from their primary items, they are not successful.
• They are unable to compete in taking market share away from rivals.
Opportunity-
• It can enter new markets with the permission of the government;
• New consumer behaviour trends are emerging, which draw customers because they are more
favourable presently (Nadir, 2021).
• The market expansion will maximise the company's effort in comparison to its rivals.
Threat-
• There is fierce rivalry in this market since the major companies have already taken control of it,
giving suppliers more power and causing them to dominate it.
• Because the business only operates in one country, there is intense competition within that
country.
evaluation of business for the company
According to analysis, creating an appropriate and successful business plan is crucial for the
expansion of the company. Knowing about the strategies that can be employed in business
growth is beneficial to business owners. It can assess the business's success by examining
various risk variables and time frames (Leke, Chironga and Desvaux, 2018). In the case of
CafePod Coffee Co., the firm may create a successful business plan by taking a variety of
concepts and elements into consideration, enabling the company to achieve its growth objectives.
TASK 4
Exit plan
A business needs an exit strategy when ownership transfers, when the owner retires, and when
the business goes bankrupt. Businessmen should be aware of a few things which are explained
below-
 The period planned for the company’s operations.
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 Financial expectations and circumstances assumed at the start of the project.
 The company’s outstanding debts, such as investors and creditors, must be paid in full
before closing or terminating the business.
Small business exit strategies that business owners can employ are further mentioned-
Liquidation- A method of closing a business and selling its assets or repaying the amount of its
creditors and other debts so that it is no longer liable in the market.
Benefits-
 The main advantage of this method is that the company is free from lawsuits.
 The Managing Director will be released from debts and creditors.
Drawbacks-
 The downside is that all liquid assets are sold with the intention of paying dividends to
creditors and allowing inventors to collect fees when the opportunity arises.
 Owners may be required to pay debts to personal outsiders (Somohano-Rodríguez, and
et. al., 2022).
Asset Closure and Sale- This route to exiting the business is to sell the assets immediately. If
the relationship with customer breaks down, the company will be liable to its shareholders and
other creditors to profit from sales of its assets. Ensure timely sale of business assets.
Benefits-
 The main claimable advantage is that the owner can pursue other projects and the owner
can pay off individual debts.
 The company can easily pay off its debt by selling its assets.
Drawbacks-
 The downside is that it can be a long process with multiple legal fees.
 A new license is required or transferred to sell the property.
Liquidating your business overtime- This is an easy option for choosing when your business’s
finances are in chaos and your business will be closed. Also known as a lifestyle business.
Entrepreneurs withdraw money from the business, although they reinvest it for the future. The
positive side is that the business provides cash flow for a balanced lifestyle. On the downside,
however, investors may find themselves dissatisfied with the company without any benefit.
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Benefits-
 The main advantage, it offers is that all disputes between creditors are terminated when
the company is declared bankrupt.
Drawbacks-
 the organization does not have the right to do business with, or use similar trade names
for, other companies that may be incorporated in the future.
Sell the business to a known- owner can sell your existing business to a partner, customer,
acquaintance, family, relative, manager, employee. In the sense that the buyer can get help and
guidance from the previous owner. It can also be disastrous when disagreements arise between
relatives. the owner can continue to participate in the project even after leaving the company.
The next business owner may not set a relatively better price than the previous one, but may sell
a discount.
Benefits-
 the buyer understands the business systems and processes and business continuity is
achieved.
Drawbacks-
 The successor may need the original party for important coaching and mentoring.
Sell the business in the open market- If business is sold to an unknown person in the market,
starting a new company is the least risky option. Sellers may be unfamiliar with existing systems,
customers, strategies, policies, etc., so they can make more money by selling in the marketplace.
benefit from If the company's financials are attractive, it has monetary value. Buyers also benefit
from brand building and customer relationships. Selling your business at an affordable price can
take some time.
Benefits-
 Buyers get an established company whose products and services have already been
tested.
Drawbacks-
 can create a bad reputation in the minds of your customers.
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Sell to another company- In this case, a smaller company may be taken over by a competitor or
company in the same industry. This can be a wise investment as it can help grow the buyer's
business and reduce competition. A sense of responsibility lends itself to this acquisition. It
doesn't take long to get used to the company in terms of work culture and dynamics. Considering
that the sale price of the company will be higher. However, the company's employees could not
accept the change (Sreih, Lussier and Sonfield, 2019).
Benefits-
 the owner can save time and potentially invest in their next project or venture.
Drawbacks-
 the owner may lose control over their business activities and operations.
Evaluation of the exit plan
From the above, CafePod Coffee Co is unable to expand its business, and is forced to choose
between terminating the business or taking over rather than making the business in the red. In
addition to the coffee shop, we recommend selling your business to another company. This is
because transferring ownership to someone else is more profitable and also helps reduce
competition in the market. It is beneficial to run a business efficiently as a company is unable to
cope with challenges and environmental changes (Paiola and et. al., 2021).
CONCLUSION
To conclude the growth plan report above, a brief summary should be given and analysed.
The first mentioned is CafePod Coffee Co., a small to medium sized company based in the UK.
The report then analyses the key considerations of the companies being measured in order to
assess growth opportunities in the context of the company. Pestle Analysis, Porter's Five Forces
Model, and Ansoff's Growth Vector Matrix ID have been performed for the organization. Next,
the report discusses the potential funding sources, pros and cons of each funding source. The
next task is to create a business plan for growth. This includes financial information and strategic
goals for the company's success. Finally, the report concludes with an assessment of the different
ways small business owners can go bankrupt and the impact it causes.
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