Growth Opportunities and Funding Sources for Syon Coffee House

This report analyzes growth opportunities and funding sources for Syon Coffee House, a coffee company in the UK. It includes a PESTLE analysis, Ansoff's growth vector matrix, and Porter's generic model to evaluate growth opportunities. It also assesses potential sources of funding, such as bank loans, and discusses their benefits and drawbacks. Finally, it provides a business plan for growth that includes financial information and strategic objectives.

Unit 42

Table of Contents
INTRODUCTION ..........................................................................................................................3
TASK 1............................................................................................................................................3
Analyse key considerations for evaluating growth opportunities and justify these
considerations within an organizational context....................................................................3
Evaluate the opportunities for growth applying Ansoff’s growth vector matrix...................5
TASK 2............................................................................................................................................7
Assess the potential sources of funding available to businesses and discuss benefits and
drawbacks of each source.......................................................................................................7
Evaluate potential sources of funding and justification for the adoption of the appropriate
source of fund?.......................................................................................................................9
TASK 3............................................................................................................................................9
Design a business plan for growth that includes financial information and strategic objectives
for scaling up a business.........................................................................................................9
Develop an appropriate business plan for growth and securing investment , setting out
strategic objectives, strategic and appropriate framework for achieving objectives ?.........10
TASK 4..........................................................................................................................................11
Assess exit or succession options for a small business explaining the benefits and drawbacks
of each option.......................................................................................................................11
Evaluate the exit or succession options for a small business comparing the options and
making valid recommendations? .........................................................................................12
CONCLUSION .............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
The first step for growing any business involves the process of planning. Planning is the
initial stage for growing or developing any business. These strategies involves planning in such a
way that there is growth in the company. The financial capacity and status of the company
should be developed with impact of effective planning and strategies. An effective planning
ensures development with continuos growth of the company. These planning includes different
thoughts, ideas and strategies for having backup plans in case of loss incurred by the company.
The members of the team are given direction to run the organisation in such a way that there is
execution of productive work. Planning involves short and long term goals in order to have
implementation of experimented thoughts and ideas. Planning involves co-ordination of
employees to work efficiently in a productive manner for growth of the company. The
organisation chosen in this report is Syon Coffee House, which is a coffee company in UK,
which is well known for its different aromatic coffees with exotic taste (SYON Coffee House,
2020 [Online]). The quality of the coffee is so good that the coffee drinkers can enjoy it at any
time.
This report will cover the PESTLE analysis of Syon Cofee House. It will further cover exit
and succession option which helps in increasing the performance of a company with its various
sources of funding. The opportunities for growth with application of Ansoff's growth vector
matrix and business plan with sources of funding will also be covered in this report.
TASK 1
Analyse key considerations for evaluating growth opportunities and justify these
considerations within an organizational context.
The company of Syon Coffee House, should inculcate effective planning in such a way that it
leads towards growth of the company. There should be different varieties of coffee so that it
matches to different taste of people. These different varieties of coffee should fulfill the needs
and demands of the people according to their taste of flavor (Demmou, Stefanescu and Arquie,
2019). This will help the company in gaining profit which will further enhance its growth and
development. The implementation of strategic model is necessary for growth of a company
which is PESTLE analysis.

This strategic model or PESTLE analysis include factors such as political, economic, social,
technological, legal and environmental. They help in evaluating growth of the company in order
to enhance its development. The objectives and aim of the market can be
achieved though this medium. The Syon Coffee House, has used PESTLE analysis in order to
evaluate the strategic framework for establishing a productive business environment. The
different factors that help in growth and development of the company are mentioned below:
 Political factor: The current political situation of the UK government in reference to
political factor of stable government, administrative system, associate and allies with
impact of Brexit. The policies and rules of the government with its different factors
determine the political factor of Syon Coffee House, Taxation policy and custom duty
helps in evaluating the financial capacity of the company. These political factors will help
in expanding the business in international market. The quality of products should be
maintained in such a way that it can be introduced on an international level by
maintaining the standards of coffee products.
 Economic factor: The current economic factor of UK government in reference to GDP
of the country, diverse economy, foreign direct investment, tax rate, inflation and
unemployment affects the economy. The company of Syon Coffee House, is influenced
by the changing rate of interest with change in foreign exchange rates which determine
the economic factor of a company. The rate of unemployment also plays a major factor in
affecting the economic growth of a company.
 Social factor: The current situation of UK government in reference to population, health
care system, education and income level determines social factors. The changing needs
and demands of the public should be identified by the company of Syon Coffee House.
They must lay their main focus on satisfying the customers as it will help in increasing its
production. The expectations of the customers should be met in such a way that it fulfills
the social obligations of the customers.
 Technological factor: The current situation of UK government in reference to
technological advancement affects the technological factor. There must be
implementation of technologies in order to produce a qualitative product (Ehsan and
Yang, 2019). The use of innovative and creative ideas with aid of technology can help in
producing qualitative coffee products for the company of Syon Coffee House, the proper

blend of coffee with help of technical machines can produce quality products for the
customers.
 Legal factor: The current situation of UK government in reference to Employment Act
of 1996 determines the legal factor. The company of Syon Coffee House, can be
influenced by the different legal policies. The growth of the company may be affected by
the laws of company law, labor law and employment law. The enforcement of these laws
must be in such a way that it regulates the working capacity of employees in the
company.
 Environmental factor: The current situation of UK government in reference to
industrialization affects the environmental factor. The major changes in the climate with
geographical conditions may affect the environmental factor the company of Syon Coffee
House. The company focuses on producing coffee in a very Eco-friendly manner. There
should be less wastage in consideration of healthy environment for maintenance of
sustainability. The company implies its focus on preventing pollution by product
environment friendly products.
Porter's Generic Model: This model was founded by Michael Porter. It was developed to
strategically implement the goals of organization. The Syon Coffee House is required to
implement the growth model to achieve the growth opportunities to expand their business in the
international market. They are required to applies the three common strategy in order to use cost
effective method to reduce the wastage of resources.
 Cost leadership – There must be reduction in cost while manufacturing the product in
order to release an efficient and cost friendly product. The Syon Coffee House can use
cost reducing strategy and must focus on their profit maximization.
 Differentiation – The making of product must be different with services in order to seek
uniqueness in product by giving importance to the buyers. In context to Syon Coffee
House is required to introduce new product that is unique and novel to attract the
consumer for their coffee taste.
 focus Strategy – The selection of segments in industry will allow to focus on the narrow
competition within the industry. In context to Syon Coffee House, they are required to

focus on production and quality of product by using various marketing tactics to targe
the new audience.
Therefore, the Porter's model is most effective method to achieve growth and expansion of small
scale industry to target the large consumer base.
Business Resources: Resources play significant role for conducting business activities. It is
used to convert raw material into finished product to make them useful for the potential
consumers. In context to Syon Coffee House, there are various resources are available to operate
a business.
 Physical Resources: This resources is useful to perform various function of Syon Coffee
House, It is an tangible asset that are crucial to run a business. It includes machinery,
equipment and other raw materials that helps to process and manufacturing of product.
 Financial Resources: Finance is required to meet day to day expenses of the business.
The Syon Coffee House is required to manage their financial resources to deal with
dynamic and uncertain business environment. It is a great source of expansion of
business.
 Human Resources: Human resource is considered as one of the most important asset of
an organization. The Syon Coffee House must ensure safety and protection to their
consumers to create strong relation among the employees. The human resource is
essential to provide the better services to their consumers.
Illustration 1: Porter’s Generic Strategy

Therefore, all the above mentioned growth strategy is a key to achieve the growth opportunities
of the small scale industry to grow their business at international level.
Evaluate the opportunities for growth applying Ansoff’s growth vector matrix.
The Ansoff's growth vector matrix is used to achieve the objectives for running the business.
The Product and Market Expansion Grid also verifies the name of Ansoff's growth matrix. This
plan mainly focuses on expanding the market by implementing effective plans for growth and
development of the organisation (Feather and Meme, 2019). It aims at extracting the risks of
business while enforcing better and effective performance. This tool is very effective as it helps
in promoting sales of the company and also maintaining its position by competing in the market.
There are four different ways that may help in expanding business which are mentioned below:
 Market Penetration: As the word, itself suggested that product is introduced and
launched in the market to increase competition. The Syon Coffee House , has been
introduced wide variety of coffee in the market to bring unique taste in their product. It
can be done by decreasing the prices and improving the distribution channel to smooth
en the flow of product . The growth opportunity to Syon Coffee House includes
Maximization of profit, brand value and goodwill in the market.
 Market Development: The Syon Coffee House, developed many products to provide
adventurous coffee to the beverages lover. It can be possible through investing in
research and development to understand the consumer behavior to meet their needs. The
Growth opportunities for small scale industry includes diversification of product ,
improve in the quality of work.
 Product Development : The Syon Coffee House is required to make changes in their
existing product to make it more attractive and unique. It is done with the help of using
advanced technology and transfer knowledge to leverage into new market. The Growth
opportunity for Syon Coffee House includes establishment of brand in the international
market and expansion of business.
 Diversification: It is necessary to provide wide range of products to its customers to
cover large consumer base. In context to Syon Coffee House, their main aim is to attract
the coffee lover by providing them best quality of coffee taste. The growth opportunity
includes growth of business, large consumer base in the international market.

The Ansoff growth model will help Syon Coffee House to introduce new product to reach the
new customer the international market (France and Hong, 2020). Further, it will ensure the
penetration and diversification of product in the market. It helps to understand the risk involved
in the business and implement the plans to overcome such risk. The growth opportunities is
available which includes brand loyalty, expansion of business and goodwill in the market.
Discuss the options for growth using a range of analytical framework?
There are various option available for growth which includes Technological factor analyse
with the help of PESTLE. With the help of innovative techniques and method Syon Coffee
House can enhance their growth. By using Porter growth model , company can reduce the cost
by optimum utilizing the resources. There is another growth model that is Ansoff growth model
that are helpful for the Syon Coffee house by introducing the new product in the market in order
to achieve higher growth and development of product in the market.
TASK 2
Assess the potential sources of funding available to businesses and discuss benefits and
drawbacks of each source.
To ensure potential growth, the Syon Coffee House is required to arrange the funds to
meet the requirement of expansion of their business. Finance is an important source for
operating the business. The uncertain and undesirable situation can be handled with the help of
Illustration 2: Ansoff Growth MAtrix Model

using the available funds. The company acquires fund from various sources such as financial
institution and commercial bank in case of small scale industry. The financial position of the
company can be ascertained with the help of its profit and revenue which is earned by the
company in a financial year.
There are sources of funding that are available for small scale industry are mentioned
thereunder:
Bank Loan : It is taken from the commercial bank or other financial institution that provide loan
at low rate of interest to meet the availability of funds whenever it is needed to the small scale
industry. Business loan are common sources of funding which includes short term loans and long
term loans for the Syon Coffee House. Benefits: The biggest advantage of bank loan is that, it is most convenient way to grow
their business. It provides favorable interest rate which is easily payable and no
interference of bank till company paid the interest and loan amount (Geddes and Schmidt,
2020).
 Drawbacks: There is some drawbacks of bank loan which includes length procedure to
advance loans as it carry some risk that may affect the functioning of the coffee industry.
However, the Syon Coffee House is required to raise their funding with the help of bank loan
because it is easily available and secure the asset of the organization. The liability does not fall
on the organization to pay off from their personal asset.
Venture capital : There is another source of funding that Syon Coffee House can raise to
increase their financial capacity to operate their business. It is the best opportunity to expand
their business. It is more advanced than the bank loans as it allows the investor to bear the risk to
achieve the long term success of the company. It is the best source of funding for the start ups
and small scale industry and it reduced the burden of loss over the company. Benefit: The biggest advantage of venture capital is that build strong connection with the
business community and helps to grow business at large level. There is no compulsory
obligation to repay the investors for the venture capital.
 Drawbacks: There is chance of reduction in the value of shares . It is quite lengthy
procedure and required proper document to apply for venture capital.

However, the Syon Coffee House can raise funds from this source because as it is specifically
provide benefit to the small scale industry to grow their business at large level. If the company
has the good investors, then they can choose this option to avoid the risk of repayment .
Angel Investment: It is an important source of funding for small scale industry to grow their
capital to survive in the competitive market (Zhao, Pan and Chen, 2018). It add value in the
business to achieve higher growth in the coffee industry and good option available for them. It is
basically a group of individual who invest in company to provide financial assistance at initial
stage to bear the risk of undesirability. Benefits: It involves less formality and simple process to raise funds form angel investors
(Kildase, 2020). It is a best source to promote innovative ideas and skill of Syon Coffee
House as they already cover all the aspect of creativity and design to provide the quality
services to their consumer for tasty coffee.
 Drawbacks: There is chance of loss of control from the ownership. It involves higher risk
which may affect the functioning of Syon Coffee House.
However, the Angel investment is the most suitable technique for small scale industry as it
involves less risk and minimum legal formality to raise the funds. The Syon Coffee House can
easily allocate their resources and funds by using Angel investment technique to minimize their
financial resources to grow their business at large scale.
During the unpredictable event of COVID -19, the UK government had made the policies
and regulation for small scale company to meet their financial obligation to survive in the
market. The Government announced support package to the businesses in order to raise their
funds. They provided the direct grants to leisure businesses. Local authorities distributed funding
to support small and medium scale businesses during COVID 19 pandemic.
Evaluate potential sources of funding and justification for the adoption of the appropriate
source of fund?
The potential source of funding is essential for the purpose of raising funds from many
sources. The company is required to adopt the funds which is less risky and involves less
procedure. The Syon Coffee House is a small scale company and expansion is possible through
adopting appropriate sources of funding such as bank loan and venture capital to build strong
relation with other business community to create the large consumer base to diversify the

business. There are advantages and disadvantages of Bank Loans and Angel Investment that
helps the small scale industry to grow their business, it includes: Benefits: The bank loan and Angel Investment required less formality and easily
available to meet the financial requirements. It is the best source of funding for the start
ups and small scale industry to the burden of loss over the company.
 Drawbacks: In bank loan, repayment of interest is compulsory in a specified period of
time. In case of Angel investment, the Syon coffee House may loss their ownership.
TASK 3
Design a business plan for growth that includes financial information and strategic objectives
for scaling up a business.
The business plan is important to formalize strategies and plan for effective functioning
of the organization. These plans are not only ensure the growth but also give them good
reputation in the competitive market. The business plan made by the Syon Coffee House defines
the necessary steps that ideaised the success in order to achieve the long term and short term
objective of a Syon Coffee House.
Executive Summary: The Syon Coffee House is a small scale company that are dealing with
the variety of coffee taste and other related products to their customer (Komorowski, 2020). In
UK, the coffee of the Syon Coffee House is famous among the local lite.
There are some plans and strategies that are made for the effective running of a business are
discussed below:
Business overview: The Syon Coffee House is founded in the year 2011 with aim to provide
quality coffee taste to reduce the stress of people with their exotic taste. The are beautifully
representing their coffee by making it more attractive and creative to make it unique form others.
Mission: Their mission is to conceive quality coffee for the adventurous drinkers to overcome
their hurdles and anxiety. They are making a plan to design a variety of range of strong coffee to
enthusiast them for their taste.
Vision: They have future vision and objective is to provide fastest services of coffee at home by
increasing its production at reasonable price. They have a vision of expanding their business at
large scale and aims to establish brand loyalty in the market.

Objectives: They have ultimate objective to earn higher profit to make expansion of their
business. The main objective of Syon Coffee House is to build brand and goodwill in the market
at large by improving their quality and product. They are planning to adopt new techniques and
ways to reduce the workload by increasing their productivity and profitability.
Funding: The funding is arranged by them through various means which includes bank loan and
money from investor who are ready to invest in their company because of its popularity among
the local lite of the United Kingdom.
Growth strategy: The growth strategy will help them to make effective business plan by
applying PESTLE analysis and determining the external; factor that helps them to strengthen
their performance in the competitive market. There are Ansoff growth matrix that are helpful for
the small scale industry like Syon Coffee House to diversify their business.
Marketing Plan: It is formed for the purpose of marketing the product by using various factors
like advertisement and using marketing mix. The Syon Coffee House must implement the
marketing plan to design their budgets , marketing research to cover all the business aspects.
Plan of Action: The Syon Coffee House is required to made their plan of action to easily
implement for the success of small scale industry (Kildase, 2020). These plan helps to strategies
the growth opportunities in relation to price and production of the product. The plan is the most
effective tool to achieve growth and expansion of their business.
Marketing Strategy: It is the wider term that are used to promote and strategies the product in
the market. It is used to create large consumer base to increase the sale and production of their
product in order to earn higher profit. It includes various factors that Syon Coffee House m ust
follow:
Product: It is important tool that the Syon coffee House must consider to achieve the growth
opportunities. They should focus on their product in order to satisfy the need and demand of
consumer to gain competitive advantage in market.
Pricing : Price is crucial factor that is the great source of attracting the consumer. The price must
be reasonable so that the potential consumer can easily purchase the product. They should
provide them discount , offer and other promoting scheme by reducing their prices.
Distribution Strategy: It refers to the distribution channel that target the new place and
geographical area in a new location to enhance cover large market share of consumer to earn

revenue. They can provide the coffee product by home delivery and distribution channel so that
the product can easily be available for all the consumers.
Promotion Strategy: it is a marketing tactics that are used to promote the product at large scale.
The promotion can be done through advertisement, hoarding and through online medium such as
social media etc. Promotion can be done to convince and aware the people about their products
so that they can purchase their product. The Syon coffee House will earn the profit by using such
strategy tool.
Financial Plan: It is the most important factor for Syon Coffee House to manage their financial
sources to achieve higher growth in order to operate the day to day operation of a business. The
uncertainty and dynamic business environment can be easily handles with the help of effective
financial planning.
Therefore, the business plan is formed by the small scale coffee House to achieve their long
term goal. It helps in establishing the various plans that directly connect with the expansion of
business.
Develop an appropriate business plan for growth and securing investment , setting out
strategic objectives, strategic and appropriate framework for achieving objectives ?
Business plan is a written document that lay down all the strategies and growth model that
contributes in the growth of the Syon Coffee House . Financial plan and marketing plan helps the
coffee house to evaluate their budget and finance to manage all the business activities. (Mahabir,
and Pun, 2022). It is a tool that is used to avoid the uncertainties of market. So, it is important
the company to consider all the factor to make better business plan to survive in the competitive
market for a long run.

TASK 4
Assess exit or succession options for a small business explaining the benefits and drawbacks
of each option.
The exit and succession option is used to take the benefit of finance and expansion to either
transfer it to the third party or to success the business into various other forms. The exit and
succession option is used to according to the type and size of the business. By using the exit
strategy, the business comes into end by selling it to the third parties or by succession , they can
expand the business. The Syon Coffee House can either use exit strategy or succession to expand
and achieve the objective of the organization.
Both the strategy are discussed below:
Exit strategy: The use of business exit strategy includes selling of ownership to the investors or
to another company for the purpose of reducing the liquidity of the asset. The Syon Coffee
House is a small scale industry so , it is important for them to avoid exit strategy and focused
more on increasing their asset and technology to achieve higher growth in the competitive
market.
In exit strategy ,following option are available that includes: Liquidation: In this the Syon Coffee House, all asset are converted into cash due to
shortage of funds to pay off the debts of the creditors.
Benefits: It is advantageous to pay outstanding debts if suffered by the Syon Coffee House.
Disadvantages: The major drawback of such strategy is that , it make the directors of company
personally liable. Merger and Acquisition: It is the medium in which ownership of company is sold to the
large scale company to increase the value of the large scale company. But the merger and
acquisition may create cultural dispute among the companies and may mislead the
employees.
Benefits: The Syon Coffee House can enhance the competition advantage in the market. It
allows them to access new markets to reach the new consumers.
Disadvantages: It may increase the financial burden over the Syon Coffee House. Sometimes,
it may distress within the employees of an organization.

The succession strategy is a most useful to ensure the advantage in the competitive market. It
is important for Syon Coffee House, to expand their business at large scale by choosing any of
the factor that are mentioned below:
Succession Strategy: it is considered as one of the important strategy that helps to increase the
brand value and loyalty in the market (Rosamond, 2019). The effective planning strengthen the
financial position of hat company in order to increase the performance of that industry at large
scale.
There are various option available through which succession is possible for Syon Coffee House ,
includes: Franchising: This strategy can be useful for the Syon Coffee House to diversify their
business. It is less risky procedure and best opportunity for the company to achieve
higher growth. But there is chances of violation of privacy of the company.
Benefits: It provides business assistance to the small scale business in order to guide them for
operating a business. It gives brand recognition among the consumers.
Drawbacks: Franchising requires higher investment at initial level which may prove to be
expensive for Coffee house in the beginning. Also, there is a chances of violation of privacy
rights of Syon Coffee House. Licensing: It is a tool through which authority is given to other person to use, sell,
manufacture and produce goods on their name and charged loyalty over the product.
Benefit: The IP owner grant their right to other person through license. It promote innovation
and idea , cost saving procedure.
Drawbacks: There is risk of IP violation of the owner of the IP holder.
Therefore, the Syon Coffee House is required to use succession strategy to expand their business
at large level . With the help of this, small scale industry can grow easily and opportunity to
expand can be achieved.
Evaluate the exit or succession options for a small business comparing the options and
making valid recommendations?
The succession strategy is best form of growth opportunity to expand their business at
large level. It helps to promote the goods among the consumer to create brand loyalty and
goodwill in the market (Sandhu, Al Ameri and Wikström, 2019). They can use franchising and
licensing to succeed their business. It provides brand loyalty and reputation in the market The

resources can easily be utilized with the helps of succession strategy. The performance can be
improved in the market and changes to survive in the competitive market is increased.
 Benefits: It helps the Syon Coffee House form sudden marketing change. It promote long
term future plan to retain in the competitive market. It preserves the brand loyalty and
reputation in the international market.
CONCLUSION
From this above report, it has been concluded that planning is most effective tool to
achieve higher growth. The growth model helps them to evaluate the performance and enhance
the chance to grow in the competitive market is also increased. There are various strategic model
such as PESTLE and Porter generic model that helps the small scale industry to experience the
growth. The funds also plays significant role to meet the operation of a business .It helps to deal
with the dynamic business environment. The succession strategy is appropriate for the small
scale industry to convert their small scale industry into large one to diversify the business in the
international market.

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Online References
SYON Coffee House, 2020 [Online] Available through <https://www.syoncoffeehouse.com/>