Planning for Growth in CafePod Coffee Co.

This report discusses the growth opportunities, funding methods, and business plan for CafePod Coffee Co. to expand its customer base and increase revenue. It evaluates the competitive advantage using analytical frameworks like Porter's five forces, SWOT analysis, and Ansoff's growth vector matrix. It also discusses potential sources of funding and their benefits and drawbacks. Finally, it outlines a business plan for the growth of the company based on its scale.

Planning for growth

Table of Contents
INTRODUCTION......................................................................................................................3
LO1 The key consideration considered by the company...........................................................4
P1 Evaluation of growth opportunities..................................................................................4
M1 Analytical framework to understand the competitive advantage....................................4
D1 Evaluation of growth and the risks related to the options................................................6
P2 Application of Ansoff’s growth vector matrix..................................................................6
LO2 Various methods of funding used by the company............................................................7
P3 Potential sources of funding benefits and drawbacks of each source...............................7
M2 Adoption of appropriate source of funding.....................................................................7
D2 Evaluation of potential sources........................................................................................8
LO3 Business plan of the company...........................................................................................8
P4 Business plan for the growth based on the scale of the business......................................8
M3 Plan for securing the investment and strategic objectives...............................................9
D3 Coherent in-depth business plan......................................................................................9
LO4 Various ways of business implications by the company...................................................9
P5 Exit or succession option of the company evaluation.......................................................9
M4 Recommendations on the exit and succession option...................................................10
D4 Critical evaluation of the option for the company to plan in future...............................10
CONCLUSION........................................................................................................................11
REFERENCES.........................................................................................................................11

INTRODUCTION
A business plan defines the objectives as well as the goals of the business. It even
documents the roadmap or the plan that the organisation should follow to achieve success.
And to compete in the competitive environment. Before starting the business a proper
business plan is necessary as it organised the ideas and plans to perform the task and there is
no complication. CafePod Coffee Co. is in food and beverage industry. The company is into
exciting and unusual coffee which is strong and good for the customers. In future it is also
planning to design different range of coffees. So that the customers can readily use it and
consume at home as well. In this report by considering the growth opportunities for SME’s in
the market will evaluate it (CAFEPOD Coffee Co, 2022). Will use the analytical framework
to understand the advantage. Further by using Ansoff’s growth vector matrix evaluating the
growth and opportunities available to the company in the market. The methods by which the
fund is arranged by the company as well as the business plan for the growth of the company.
The benefits to the company and implications regarding various options are assessed.
LO1 The key consideration considered by the company
P1 Evaluation of growth opportunities
Every business wants to grow. It is very important to assess growth opportunities for
every business. Because if it does not it can lack behind in competition with other rivals. But
it is a difficult question as to how a business can develop goals inclined towards its growth.
So here are some of the key considerations that CafePod Coffee Co. can take into
consideration while evaluating its growth opportunities –
Search the competition - It is very important for CafePod Coffee Co. to keep a eye over its
competitors in order to track the similarities and differences between our company and rivals.
In case any other competitor is doing great than the company it is very important to assess
what are the differences existing (Rahman, Manjang and Ilham, 2018). The company should
work on the differences so that it can have edge over its competitors.
Identify new sources of revenue – The most important step for expanding the business is to
increase revenue on large basis. Increased revenue is the one of the factor for using growth
opportunities. There are different sources of revenue. CafePod Coffee Co. can lead the
market by just using the most effective source.

Determine your perfect customer – In case CaféPod Coffee Co. is planning on to expand in
some new country or city, proper analysis of target customers is required to ensure that
business will survive in such environment.
Comply with all the requirements – CafePod Coffee Co. needs to ensure that it complies
with all the requirements. These requirements can vary from fulfillment of legal regulations,
Commitments, debt payments to be done within the due time (Aguzarova and Aguzarova,
2018). If a company does not focuses on this it can become a big obstacle for the growth of
the company.
Unique Selling Proposition – If company is able to identify what makes the company
different from others then it can drive itself for achieving long term growth. USP also gives
customer a different and attractive perspective of the company. If USP is defined then
company is clear regarding what goals to be set and work in which direction. It also separates
the company from its competitors.
M1 Analytical framework to understand the competitive advantage
CafePod Coffee Co. needs to analyze the competitive framework in order to gain
competitive advantage over its rivals. Competitor analysis framework is the framework that
companies use to evaluate and understand their competitors. This framework is also known as
competitor analysis model or market analysis framework. There are a lot of options available
with the company while analyzing competitor framework –
 Porter’s five forces – This framework was designed by Michael Porter. Using this
framework Company can examine five most key factors which are as follows –
a) Threat of new entrants
b) Bargaining power of supplies
c) Bargaining power of new buyers
d) Intensity of competitive rivalry
e) Threat of substitutes
 Growth share matrix – Under this option CafePod Coffee Co. can differentiate its
products or businesses into four specific categories –
a) Stars – Company should invest more in this category. This category comprises
of products with high growth and high market share.
b) Question marks – The decision regarding such category lies in the company. It
can invest in it or not (von Schönfeld and Ferreira, 2021). These are the
products with high growth but low market share.

c) Cash cows – These products can be used to arrange more funds to invest more
in stars. These products have high market share but have low growth.
d) Pets – Mostly company should give up on it as these products have low
growth as well as low market share.
 SWOT analysis – This analysis covers analysis of strength, weakness, opportunities,
threats. This is considered one of the best key factor in analyzing competitive
advantage over its rivals.
a) Strength – Factors that are strong and provide benefit to the company. This is
internal factor.
b) Weakness – Factors that cause losses or disadvantages to the company. This is
internal factor.
c) Opportunities – Factors that gives opportunities to the company. This external
factor should be grabbed by the company on time.
d) Threats – Factors that causes challenges to the company. Company needs to be
proactive towards threats.
 Perceptual Mapping – In this option company uses plot graph to map the company
and its competitors (Gurran and et.al., 2021). The company uses any two variables
like price and quantity and then map the company and competitors on the graph. This
gives a bird eye view of the status of company and its rivals of how customer looks at
the company. Through this mapping company can improve the points where it falls
below the others.
D1 Evaluation of growth and the risks related to the options
As can be seen from the above discussion that there are many options available for
growth. Company should use effectively any option while using any strategy of growth. Like
in SWOT analysis company may loose out on some opportunities or it is possible that
company may ignore threats coming in future. Under Growth share matrix company analyses
products and classifies it into stars, question marks, cash cows, pets. Sometimes company
may classify its products under wrong category (Queirós and et.al., 2021). So it is very
important for any business to implement any strategy wisely.
P2 Application of Ansoff’s growth vector matrix
Ansoff matrix is used for evaluating growth opportunities for CafePod Coffee Co.
This matrix shows the combination of products with markets and how a business can use this
matrix effectively for achieving its goals. This matrix covers four options where products and
markets are mixed in different permutations and combinations. Along with existing products

there can be new products also. Additionally company can also plan to expand into new
market. So company can plot a mixture of existing products or new products and existing
market or new market on matrix. This matrix helps the company to manage existing products
and markets and also helps in analyzing whether the company should go into making new
product or enter into new market. Lets understand these four strategies in details –
 Market Penetration – This growth strategy involves more sales to existing
customers or markets of existing products. So this strategy mainly focuses on
increasing customer base and loyalty and building a healthy long term relationship
with customers. Company can also focus on improving after sales services to
customers.
 Market Development – In this growth CafePod Coffee Co. can focus on
increasing sales of existing products to new customers or market. The best
example of this strategy can be introduction of new market like new geographical
location and company can also adjust its existing products with some
modifications according to environment of new place (Hersperger, Grădinaru and
Siedentop, 2020). Before going into new market company should analyze the new
market and demand existing there.
 Product development – Under this growth strategy company will introduce new
product or may add some new features to the existing products in order to attract
existing customers. The company should try to be in line with the changes in the
existing market and adapt with the changes. Company can also introduce new
product if it feels the need so.
 Diversification – Under this growth strategy CafePod Coffee Co. can introduce
new product in new market. The best example of this strategy can be
globalization. Through globalization company can easily increase the operations.
This is considered to be the strategy with the highest risk as there are many cases
where many businesses have failed after using this strategy. This strategy is most
suitable for large organizations as they are more capable for expanding their
business.

LO2 Various methods of funding used by the company
P3 Potential sources of funding benefits and drawbacks of each source
Some of the sources of funds are listed below –
Working capital – It refers to funds from daily activities. Working Capital is equal to Current
assets minus current liabilities. It make sure that the current and short term obligations are
met from this. This need to be calculated so that the current levels and the future needs can be
known. Its advantage can be that there are no costs involves and no repayment is needed. Its
disadvantage can be that this is not a long term fund and it cannot raise large amount of
funds.
Retained Profits – It refers to the profit which is undistributed. It refers to the amount of
profit which the company has made in the past as well as the current profits which can be
used for paying dividend or any liability and further investment in the company. Its
advantage is that there is no need of interest and principle repayment (LeCounte, 2022). If a
business is making losses it cannot use this source.
Debentures – It is a kind of debt capital on which interest payment is mandatory. It is the
long term business debt which can either be secured or unsecured based on the liability or the
amount. Through this the company can get funds which help to not dilute the equity of the
company as it is the main part of the company. Its advantage is that debentures will get back
their payment after term of debenture is over. Its disadvantage is that its interest has to be
repaid at any cost even if the company is making loss.
Loans – This refers to the money borrowed from banks or other institutions. In this the
company is liable to pay the interest portion on the basis of the terms identified between the
company and the institution. It require collateral for the advancement of the money without it
the money is not given. Its advantage is that large amounts can be borrowed. Its disadvantage
is that collateral is compulsory and it attracts fixed interest payments.
M2 Adoption of appropriate source of funding
There are a lot of sources of funds available. It depends on company’s nature, size,
operations volume if company needs some long term fund or short term fund. CafePod
Coffee Co. is a small organization. This business does not have many creditors and debtors.
So working capital will not be a suitable fund. In case company is earning huge profits then
the best alternative it can opt for is retained earnings. But if company is incurring losses then
it can go for other alternatives like debentures or loans. Banks provide loans with interest
rates which are compulsory to be paid. This source can be arranged more easily except has

one disadvantage is that all the interest payments are compulsory and principle amount needs
to be repaid.
D2 Evaluation of potential sources.
As discussed above loans and debentures are the most appropriate for CafePod Coffee
Co. as this fund is easily approachable as compared to other alternatives. Its one of the
advantage is that large amount of funds can be arranged for long term period. Additionally
banks have no right to restrict the use of amount of loan which means it can be used by the
company for any use. The biggest disadvantage of using this fund is one has to pay interest
on fixed basis and loan amount is needed to be repaid (Gounaridis, Chorianopoulos and
Koukoulas, 2018). After all the conclusions loan can be the most appropriate source.
LO3 Business plan of the company
P4 Business plan for the growth based on the scale of the business.
Business plan is very crucial for the company to operate in future. And to reach and
accomplish its future goals. To increase the scale of the business largely and expand the
customer base CafePod Coffee Co. plans is based on several things which are as follows:
Firstly the company should identify its vision that where it want to go and make a
mission statement. Which include the mission of the company. Accordingly, it should plan
which should includes it goals which are to be achieved in long term as well as the objectives
which are to be completed within a short term or less span of time. As while making the plan
and drafting it the most important field is the finance.
Which includes the projections which are to be made and the methods and ways to
raise that money. As well as to finance the money for the company. The plan should also
contain the complicated decisions regarding the finance that from where the advance is to be
raised so that it can minimize its interest expense. As this will help to scale up its operation
and to save the expenses and accordingly invest in the business.
As in the fast growing environment and change in the needs of the customers the
company has to re measure its goals and objectives to scale up the business. To change
according to the technological and environmental changes the company should take finance
keeping in mind the profit and the needs of the customer and its future benefit. As the
company is run on a small scale so it is very difficult to evolve according to the technology as
it requires huge investment.
To implement the objective of the company it should motivate its employees to be
optimistic, energetic and have a good leadership strategies (Onodugo and Ezeadichie, 2019).

Even the manager should motivate and influence the employees to do more sales to grow the
company. The company should even work on its cash flows has in the fast growing company
has to invest lot and had to pay to the suppliers as well. Accordingly on this basis the
company should plan its finances.
M3 Plan for securing the investment and strategic objectives.
Based on the vision and mission statement of the company. It want to increase its
products as well as want to target huge customers. So that it can earn huge revenue and
increase the customer satisfaction as well. Based on the plan it can be easily identified that
the company fund from outsiders such as banks and even from the public. The company is
planning to invest in new machines so that more products can be introduced by it. CafePod
Coffee Co. secure its investments by investing in its strengths and not investing in its
weakness so that the company does not occurs losses. It work on its threats and grab the
opportunities which are available for it to make a first mover advantage for the company. By
using the SWOT analysis it makes it decisions so that the investment can be made on that
basis (Sparkman, 2018). As the company is small so it have to keep its finances record and
save them.
D3 Coherent in-depth business plan
As per the above plan the company have a mission statement to run in the long run.
As its goal is to introduce new products and work more on the financial information. On the
basis of the financial information it can even budget the expenses and the revenue which it
can make. As on the basis of the knowledge regarding the strategies which can help the
company to grow its business and expand its operations. To achieve the goals and objective
the company work on the methods of funding as well as see the competitors. It analyse the
conditions by using the Ansoff matrix through which it can even know the growth
opportunities available to the company.
LO4 Various ways of business implications by the company
P5 Exit or succession option of the company evaluation
An exit strategy means the end of the business. In this it includes the transition of new
phase or whether re considering the business decision and the financial sustainability. If the
company is into the full exit strategy then it has to take into the considerations the all the
stakeholders of the company (Wann-Ming, 2019).

As the if the company is doing good then it should not follow exit strategy. But if it is
struggling then it should minimize its losses by using exit strategy. The benefits of using the
exit strategy is as follows:
 It helps to make business decisions with the direction. As through this the stage of the
business in mind and it likes to set goals with the strategic decisions.
 Through this the loss making segment can be shut down so that the company can
focus on the other products.
 This even help to make the business more attractive to the buyers as to commit the
business vision.
As well as the there are the drawbacks of this strategy (Zafar and Akhtar, 2020). As due this
the company’s goodwill is reduced as well as the business does not make much profit. And
sometimes it is difficult to make profit on selling of the business. As sometimes there may
not be the potential customer available for the purchase.
M4 Recommendations on the exit and succession option
The company can use various succession and exit strategies. Which can be more
beneficial for the company. As the company can even do direct succession in this the
company can be passed on to the family member or partner who has the key role in the
business. As this helps to grow the business in the long run. If the company is sold to the
relative then it will definitely succeed in the long term and the business will grow more. As
being the small company it cannot bring the IPO in the market. So it has another option in
which it can shut down the business as it is the best option as it can easily liquidate all its
assets and cash out and move on.
D4 Critical evaluation of the option for the company to plan in future.
If the company is not making profits or even it is not able to manage its costs. Due to
this the company has the best option to shut its operation. As in the long run it will not able to
cover its costs as well as incur more losses which will result in more liability. So CafePod
Coffee Co. should plan its future in such a way so that there is no need of the business to shut
down (Kim and et.al., 2022). Even it should check and re-estimate that the cost which is
incurred is recovered so that the company can earn profits in the long run and can make
investments. It should manage its finances well.
CONCLUSION
In this report it can be concluded that as CafePod Coffee Co. is a small company so it
is analysed that what are the growth opportunities which are available to the company. It has

been analysed using the SWOT analysis of the company. Through this the growth
opportunities which are available in the market are considered and so that the company can
even go with the new products. Through the Ansoff growth matrix it can be seen that the
company should develop its product as well as it can even go for market penetration. As in
market penetration it can be seen that the company is small so to grow its market share it
should focus on the customers which are already present and satisfy their needs. Then in the
long run the company can even so for the development of the products to increase its
customer base. It is also assessed that the funds are organised through various methods which
help to grow its business. Further with the help of the business plan it can be concluded that
with the proper vision and mission statement the company can achieve its goals and
objectives. Lastly, it can be assessed that the company should shut its business in case it is
not able to cover its cost. As it can cause huge losses in the long run. So based on this the
company should use exit strategy and succession option based on the benefits as well as the
drawbacks.

REFERENCES
Books and Journals
Rahman, Y.A., Manjang, S. and Ilham, A.A., 2018. Distributed generation’s integration
planning involving growth load models by means of genetic algorithm. Archives of
Electrical Engineering. pp.667-682.
Aguzarova, L.A. and Aguzarova, F.S., 2018. Planning of tax payments as a factor of
economic growth.
von Schönfeld, K.C. and Ferreira, A., 2021. Urban planning and european innovation policy:
Achieving sustainability, social inclusion, and economic growth?. Sustainability. 13(3).
p.1137.
Gurran, N. and et.al., 2021. Population growth, regional connectivity, and city planning—
international lessons for Australian practice. AHURI Final Report.
Queirós, A.M. and et.al., 2021. Bright spots as climate‐smart marine spatial planning tools for
conservation and blue growth. Global change biology. 27(21). pp.5514-5531.
Hersperger, A.M., Grădinaru, S.R. and Siedentop, S., 2020. Towards a better understanding
of land conversion at the urban-rural interface: Planning intentions and the
effectiveness of growth management. Journal of Land Use Science. 15(5). pp.644-651.
LeCounte, J.F., 2022. Founder-CEOs: Succession planning for the success, growth, and
legacy of family firms. Journal of Small Business Management. 60(3). pp.616-633.
Gounaridis, D., Chorianopoulos, I. and Koukoulas, S., 2018. Exploring prospective urban
growth trends under different economic outlooks and land-use planning scenarios: The
case of Athens. Applied Geography. 90. pp.134-144.
Zafar, A. and Akhtar, G.K.H., 2020. Effect of succession planning on organizational
growth. Journal of Social Sciences and Humanities. 59(1).
Onodugo, V.A. and Ezeadichie, N.H., 2019. Future planning of Global South cities with
inclusive informal economic growth in perspective. In Sustainability in Urban
Planning and Design. IntechOpen.
Sparkman, R., 2018. Strategic workforce planning: Developing optimized talent strategies
for future growth. Kogan Page Publishers.
Wann-Ming, W., 2019. Sustainable Urban Transportation Planning Strategies for Improving
Quality of Life under Growth Management Principles. Sustainable Cities and
Society, 44.
Kim, J. and et.al., 2022. Expected economic growth and investment in corporate tax
planning. Review of Accounting Studies. 27(2). pp.745-778.
Bridge, J. and Dodds, J.C., 2018. Planning and the Growth of the Firm. Routledge.
Online
CAFEPOD Coffee Co. 2022. [Online]. Available Through: < https://www.cafepod.com/?
gclid=Cj0KCQjwuaiXBhCCARIsAKZLt3ncajHv5VELT0vbt4o3vhWZKJwjSlKbdje8
WRCI47seKzZCvFQiyPcaAohxEALw_wcB>. [Accessed 3 August 2022]