Growth and Development Strategies of SME: A Case Study of Dimello Coffee

This report analyzes the growth and development strategies of Dimello Coffee, a small medium enterprise involved in the distribution of coffee beans. It discusses the challenges faced by the organization, its current growth and development strategy, and the government measures that help businesses overcome challenges. The report also covers the corporate social responsibilities fulfilled by the business.

Project

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Nature of the owner behind the start- up.....................................................................................3
Start- up procedure of SME.........................................................................................................3
Concept of business and some sources of competitive advantage...............................................4
Current demand level and competitive environment...................................................................5
Growth and development of the business till now.......................................................................6
Challenges faced by organisation in running operations of business..........................................6
Current growth and development strategy of SME.....................................................................6
Government measures which helps businesses to overcome form the challenges faced by them
......................................................................................................................................................7
Cooperate social responsibilities fulfilled by business................................................................7
RECOMMENDATION ..................................................................................................................7
CONCLUSION ...............................................................................................................................8
REFERENCES................................................................................................................................8
Books and Journals......................................................................................................................8

INTRODUCTION
The businesses strategies framed by management of organisation helps in attaining goals
of organisation effectively along with performing functions smoothly. By making use of
effective strategies companies can get competitive advantages (Song, Yang and Yu, 2020). They
can also provided a better experience to it's customers by framing strategies. A sudden growth
can be seen within the businesses when whole management made efforts in order to frame
business strategies. When an entrepreneur plans to establish it's venture they make use of
business strategies for making it's businesses profitable. The report is base on SME or small
medium enterprise named Dimello Coffee. This SME was established in 1992 by Kafeea Terra,
who are involved in distribution of Coffee beans. This report is base of growth and development
of SME using different strategies, along with the barriers or challenges faced by them and
actions taken by them in order to overcome from those challenges.
MAIN BODY
Nature of the owner behind the start- up
The owner has initially started it's business unit by importing it's products. They were
bing involved in producing 100% Greek products (Aigbefo, 2022). The owner started businesses
with a workforce of small group within a small factory. In 2006, the owner make use of advance
tools and equipments within it's businesses in order to enhance production capacity, thus per day
capacity reach to producing 3.5 tons of output. Later in 2014, the owner started making use of
marketing strategies for the sake of increase customer engagement and the production also raise
to 9 tons per day. By 2017, they were involved in launch of new line of product that is espresso
and ground filter. Now this brand has made it's strong position in UK, market and is also
involved in distribution of products to other brands.
Start- up procedure of SME
The organisations have to follow certain sets before setting up a business unit. The
process to start a business idea is as follows -
 Identification of idea – The first step is to develop a business idea, there are certain
trough which run in the mind of an individual so it is necessary for the entrepreneur to
evaluate which idea will be most suitable for transforming it into business (Gilmore and

Carson, 2018). Owner of Dimello was bit experienced regarding varieties of coffee so
this is how they opt to chose this for business.
 Screening idea – In this step overall evaluation of business idea is being made in order
evaluate the business idea. The owner of Dimello have analysed that demand of coffee
will eventually rise this is why they finished this idea.
 Business plan – The businesses required to make a development of business plan that
how the activities will take place. With this, certain strategies where make that will also
be considered at the time of making business plan. The Dimello have decided to make
use to different equipments in order to produce products with a workforce of few
members.
 Funds availability – The next step is to decide the sources of funds, from where the
funds can be avail for businesses. As at the time of establishment of businesses huge fund
is required by individuals in order to run function of businesses smoothly. Dimello
requires small funds so they take help of bank to collecting funds. Licencing – The businesses could not run it's operations without permission of legislative
bodies. After getting register then only businesses can make it's operations run as it is
illegal to start businesses without informing government authorities. Thus Dimello take
permission from legal authorities for staring it's venture.
Concept of business and some sources of competitive advantage
The owner of Dimello wants to make an effective distribution channel though which they
are able to make sales of it's products deliver to each customer (Gukurume and Matsika, 2022).
They want to sale high quality of coffee beans to customers in order to enhance it's customers
base. They were also involved in launching new product line which will help them in growing
it's businesses. The product line introduced by them are coffee ground, coffee capsules,
subscription and bulk and lastly home barista. The new products are launched in order to
enhance customers base and they are designed as per the taste & preferences of customers.
The Dimello can get competitive advantages by selling it's products at low prices along
with keeping the quality of products high. The company can also add some healthy products in
it's portfolio is order to seek attention of heathy conscious person. The customer base will be
enhanced by adding such products in portfolio as now a day customer are more healthy centric.

Current demand level and competitive environment
The current demand of Dimello is high as they involved in producing coffee beans. The
demand for coffee is raising rapidly (Baker, Kumar and Singh, 2018). The huge number of
population is being involved in consuming coffee every day. With this, the employees working
in cooperate seems to be addicted towards coffee, they use to consume twice or thrice cup of
coffee in a particular day. This is why the demand of Dimello coffee is rising rapidly, along with
it they are providing high quality of coffee beans at lower prices. So, this factor is also important
for making rise in the demand for coffee products produced by Dimello.
In order to make analysis of competition within the market Porter's Five Forces model is
being used, which is mentioned below -
 Threat of competitors – The treat of competitors implies that huge number of
competitors are being involved in industry who are involved in producing coffee. So to
overcome form this threat Dimello is involved in making some additional changes within
it's products. With this, the prices charges by them is low, they are able to keep prices
low by achieving economies of scale because of have large customers base.
 Threat of substitute products – There are many substitute of coffee which make easy to
replace coffee with them. These products involves tea, chocolate milk, chicory, matcha
and many more. Dimello is able to manage this treat as coffee comprises of caffeine
which helps in reducing sleep. This is why to avoid laziness during working hours they
use of prefer coffee and hence Dimello is getting advantages.
 Threat of new entrance – The competition is rising rapidly and hence the customers are
spread over this is why organisations have threat from new entrance. The strict rules and
regulation framed by government at the time of start- up of new ventures this threat is
being reduced.
 Power of buyers – The customers are getting wide range of options of coffee due to
increase in competition. This makes the power of negotiation transfers in the hand of
customers, but Dimello is involved in selling high quality of products at low prices which
influence customers to make purchase form Dimello and hence bargaining power is being
transferred in the hand of company. Power of suppliers – The suppliers are easily available so Dimello can make negotiation
which them upon prices to keep it low and hence power is in hand of company.

Growth and development of the business till now
Till now, Dimello is able to make delivery of it's product in various countries such as
Ethiopia, Guatemala, Brazil, Colombia, Nicaragua and India (Sánchez-Gordón and Colomo-
Palacios, 2019). By delivering high quality products they are able to grab attention of more
customers. The taste offered by them is as per customers preferences this is why they are able to
make continuous growth and development within it's businesses. The company is capable
enough to achieve economies of scale because of large customers and hence low cost products is
offered by company.
Challenges faced by organisation in running operations of business
While establishment of the businesses certain challenges are to be faced by them in order
to run it's operations smoothly, some major challenges faced by Dimello are as follows -
 Adequate amount of fund – The small and medium enterprises do not have huge funds
due to which Dimello can't make rapid expansion within it's businesses.
 Lack of Research and development – The small medium enterprises have lack of funds
due to which they can't afford a research and development team. Hence, Dimello are not
able to make proper analysis of current market and customers. Lack of technological use – Due to lack of fund the small and medium enterprises do not
make use of technological products as huge cost is being involved of Dimello in
purchasing those equipments.
Current growth and development strategy of SME
Dimello is making use of Ansoff Growth Matrix in order to check current growth and
development strategies available within it's businesses (Brassell and Boschmans, 2019). The
components of Ansoff growth matrix are mentioned below -
 Market Development – The company Dimello is planning to expand it's business
operations in new countries. By collecting some funds they will make expansion with
existing products in new market to enhance customer base.
 Market penetration – The Dimello is using different strategies in order to grab attention
of existing customers with the available products they have with them.
 Product development - The new products developed by Dimello for health conscious
persons is product development as they are pitching market with offering them new
products.

 Diversification – The new products that is healthy product will be delivered to different
countries within new market is termed as diversification because market as well as
products both are new.
Government measures which helps businesses to overcome form the challenges faced by them
With the help of government schemes small medium enterprise can save themselves from
the challenges which are being faced by them. The necessary measures taken by UK government
are as follows -
 The tax rate charges upon SME's is lower, so that they can keeps prices of it's products
low.
 The SME get loans for expansion as well as for establishment easily. This motivates
owners to start new ventures in order to create more job opportunity for the sake of
economic development. The interest rate charged upon SME is low with this any mortgage is also not kept by
them. This make the owners to take initiation towards expansion of businesses and make
it's business grow.
Cooperate social responsibilities fulfilled by business
The organisations who fulfil CSR responsivity creates positive brand image in the mind
of customers (Diallo and Gundogdu, 2021). The cooperate social responsibilities which are being
fulfilled by Dimello are as follows -
 Dimello is offering fair wages to all it's workforce in order to make them feel satisfied
and hence the retention rate also improves.
 The quality of the products provided by Dimello is high, this helps companies in getting
competitive advantages because other competitors are offering same products at higher
prices.
 For packaging the products, Dimello is making use of cloth bags as well as of recyclable
cardboards, which helps in preventing environment.
RECOMMENDATION
From the above report it has being analysed that company is offering premium quality
products as per the requirements of customers. So by availing some funds they can expand it's
businesses in other countries also. By having new customers base they will have to increase it's

productivity which will lead in achieving economies of scale. They can also take help of
government for the purpose of availing funds.
CONCLUSION
From the above report it can be concluded that, the by making effective use of businesses
strategies organisational goals will be achieved quickly. The porters five force model helps
Dimello in evolution it's competitors. The growth and current position is measured with the help
of Ansoff's growth matrix. The SME can take help of government in order to overcome form the
challenges faced by them.

REFERENCES
Books and Journals
Song, H., Yang, X. and Yu, K., 2020. How do supply chain network and SMEs’ operational
capabilities enhance working capital financing? An integrative signaling
view. International Journal of Production Economics, 220, p.107447.
Aigbefo, Q.A., 2022. Understanding SME employees' security behaviours when performing
work tasks using BYOD from multiple work locations (Doctoral dissertation, Macquarie
University).
Gilmore, A. and Carson, D., 2018. SME marketing: efficiency in practice. Small Enterprise
Research, 25(3), pp.213-226.
Gukurume, S. and Matsika, F.T., 2022. Labour Dynamics in Chinese Small and Medium
Enterprises (SME s): Everyday Encounters and Relations in Harare, Zimbabwe. Africa
Review, 14(3), pp.305-331.
Baker, H.K., Kumar, S. and Singh, H.P., 2018. Behavioural biases among SME
owners. International Journal of Management Practice, 11(3), pp.259-283.
Sánchez-Gordón, M. and Colomo-Palacios, R., 2019, September. Developing SPI Culture in the
SME Arena: An Exploratory Study. In European Conference on Software Process
Improvement (pp. 222-234). Springer, Cham.
Brassell, M. and Boschmans, K., 2019. Fostering the use of intangibles to strengthen SME access
to finance.
Diallo, A.T. and Gundogdu, A.S., 2021. Sustainable Islamic SME Financing. In Sustainable
Development and Infrastructure (pp. 57-75). Palgrave Macmillan, Cham.