Planning for Growth: Evaluating Opportunities and Funding Sources for Laynes Espresso Cafe

This report discusses the growth planning of Laynes Espresso Cafe, including evaluating opportunities and funding sources. It also covers competitive advantages, Ansoff growth vector matrix, business plan, and exit/succession options. The report includes analysis of VRIO framework and Porter's Five Forces. The chosen SME is located in the United Kingdom.

PLANNING FOR GROWTH

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
LO1..................................................................................................................................................3
P1.................................................................................................................................................3
P2.................................................................................................................................................6
M1................................................................................................................................................7
D1.................................................................................................................................................7
LO2..................................................................................................................................................7
P3.................................................................................................................................................7
Sources of funding.......................................................................................................................7
M2................................................................................................................................................9
D2...............................................................................................................................................10
LO3................................................................................................................................................10
P4...............................................................................................................................................10
Business plan.............................................................................................................................10
M3..............................................................................................................................................13
D3...............................................................................................................................................13
LO4................................................................................................................................................14
P5...............................................................................................................................................14
Exit or succession options- .......................................................................................................14
M4..............................................................................................................................................15
D4...............................................................................................................................................15
RECOMMENDATION.................................................................................................................16
CONCLUSION..............................................................................................................................16
REFERENCES................................................................................................................................1

INTRODUCTION
The planning for growth is the strategic activity of business that enables the owners of
business to make plan and track the organic growth in their revenues. The growth planning helps
in allow the business to allocate their resources and adapt the changes in the business
organization. The chosen small medium enterprises is Laynes Espresso cafe located at United
Kingdom. This report will discuss the evaluating growth of company, competitive advantages
and evaluating opportunities with the Ansoff growth vector matrix. This report will also
elaborate the different types of funding with the benefits and drawbacks as well as elaborate the
business plan that includes the strategic objectives and financial information. These report will
also discuss the exit or succession option with the drawbacks and its benefits as well as choose
the best option for the Laynes company.
LO1
P1
Introduction of company
Laynes Espresso cafe is the coffee destination in the United Kingdom. It provides the
various services to its customers such as online stores and provide the online booking. The
company mainly focus on the two quality ingredients such as milk and coffee as well as
company offer some lunch and breakfast options.
SME
SME is referred as the small medium and enterprise that plays a major roles in contribute
to the global economic developments and contribute to the job creation in the corporate world
(Álvarez Jaramillo, 2019). The SME consist low numbers of employees and its turnover also not
more.
Business developments
Planning and growth of the Laynes organization will to provide the full time chef at
Laynes. Employees of company can work in close contact with the general manger, head chef
and business director as well as every people who involved in the professional team to develop
and maintain the food offering at Laynes (Hanák and Grežo, 2020). The company will launch the

new flavour products as well as they will also ensure that food must deliver to table on accurate
time.
Competitive advantages
Competitive advantages is referred as that allow a business to produce the goods and
services better and cheaper than its competitors in the competitive marketplace. It allows
business to generate the mire sales and increase profit margins as compare to its market rivals.
There are various competitive advantages such as cost based advantages, tines based, technology
based and first mover advantages (Meskin and Liao, 2018).
There are various frameworks in planning the competitive advantages such as strategic group
analysis, porters five forces, perceptual mapping, customer journey map, business model canvas
and growth hare matrix and swot analysis.
Unique resource in organization
There are various unique resource in coffees shop such as automatic drip coffee maker,
commercial espresso machine, commercial blenders and pumps and containers, etc.
VRIO frameworks
The VRIO framework is business analysis framework that helps business to identify the
resources and advantages that give them a competitive edge. The VRIO framework is the
measurements of success that relate to the business and it considers the internal analysis of
business. VRIO framework is stands from value, rarity, imitability and organization.
The VRIO analysis helps in analysis the competitive advantages of Laynes (Chatzoglou, 2018).
 Values: Value relates with the requirements that drive company products and services
and the company use the human management data to retain and hire productive,
innovative employees. These employees help in create the popular consumer products
and services.
 Rarity: The company have the rarity data based employees management that cannot be
used by others and it is extensively.

 Imitability: The human capital mid-management in Laynes is costly and difficult to
imitate. The companies have to invest and build on training the staff on the strategy and
technology.
 Organization: The employees must skills to maintain and collect the customer data. The
leaders and HR team also focus in use the data to manage, promote and improve the
performance of employees in coffee shop.
There are various benefits of VRIO to companies such as that allows taking advantages
of competitiveness, it helps in set the future plans for business and allocate resources in better
ways (Ariyani and Daryanto, 2018). The VRIO framework helps in identify the threats and
opportunities to determine the business importance.
Porter five forces
The porter five forces is the competitive framework that helps in analysis a company
competitive environments. It helps in identify and analysis the competitive forces that helps in
shape the industry.
 New entrants: the new entrants in the external factors in market that can affects the
company volume and its sales as well as their market shares. There are high risk of new
entrants because the smaller cafe have low labour, supply and facilities cost as compare
to the large coffee shops. The new entrants depend on o the larger and smaller coffee
shop chain.
 Competitive rivalry: the competitive rivalry also the external factors and that affects on
the business and there are various companies which compete with the Laynes such as
cranberry, sift, house of koko, etc. Laynes competitive is only high because most the
companies compete with the business to provide and offer the similar products and
services as Laynes.
 Power of buyers: the customers of company can easily switch according to their tastes &
preferences (Isabelle, 2020). The customers can easily switch to going in other coffee
shop for breakfast and lunch and it can impact largely in the business so the bargaining
powers of the buyer are also high.

 Power of suppliers: in the coffee shop, the business have the low numbers of suppliers.
Company can choose from the various suppliers and work with those are more
convenient. The power of suppliers for the coffees shop are weakened as well as they also
cannot impose the high because they can lose their customers so, bargaining power of
suppliers are also low (Bruijl and Gerard, 2018).
 Threats of substitutes: there are various substitutes that customers can choose, and he
cost of switching to other coffee provide low as well as the substitutes are highly
affordable. The threats of substitutes for company are very strong. It means that the
threats of substitutes are high.
P2
Ansoff matrix
The Laynes company grow and promote its business across the globe. The Ansoff matrix
is the toll that helps in promote the growth strategies in combinations of products and services
and its market Laynes is operating. The matrix helps business to choose the best growth strategy
for the future expansion of business, market share growth and revenues.
 Market penetrations: the Ansoff suggested that the market penetration is low risky
growth strategy because it helps in encourage the business sales and its products in the
current market place. The company can adopt this strategy in unique ways. The company
cam adopt this strategy by giving loyalty and rewards cards to its customer (Dawes,
2018). Company can give them some attractive cups to more connect with customer.
 Product developments: This is the growth strategy for business and encourage business
to expand its products as well as introduce new products for customer. In other words
company can relaunch the same products in different versions.
 Market developments: It is another ways of market expansion. This strategy suggests
that the company needs to enter in new market with current products it can be done
demographically and geographically. Laynes company able to expand itself in new
market as well as helps in earn great profits.
 Diversifications:
 This strategy helps business to launch new products for new market. It is riskier strategy
because business operates in new markets so, it riskier than other strategies. The
company can offer the different versions of coffee and flavours as well as they can

diversify itself in food industry. It is opportunities to enhance sales and grow its market
share.
M1
The porter five forces of competitive analysis are mots significant for the coffee shop to
analysis the business competitiveness and it helps in understand the competitive advantages
within the organization (Gumel, 2019). There are various frameworks which are helps in analysis
the competitive advantages but the porter five forces is options for the business growth.
D1
The specific option for business Ansoff growth matrix taking the riskiest of each option
in the market developments, product developments, diversification and market penetrations so,
this risk can mitigate with the helps by applying the strategies to mitigate the risk.
LO2
P3
Sources of funding.
There are various types of funding for small and medium business that some of financial
methods such as follows:
Own capitals
The own capital is also known as the personal savings. The company seek to borrow the
personal money and own capitals of partners, shareholders and owners for the business financial
requirements and that types of financing is known as personal savings (Tandi and PasandaTandi,
2022).
Benefit
 No paperwork needed.
 It can be interest free.
 There are no requirements of paid back.
Drawbacks
 Own capital and saving is not an options if larger amounts of sources are needed.
 It is consisted an informal agreement.
 It can cause the cash flow problems for company.

Bank loans
The loans can be borrowed form the financial institutions and banks for long term and
short term investments for business expansion and its developments. The ban loans are more
suitable for the coffee shop.
Benefits
 It is more suitable for the long term investments.
 The interest rate are loans lower than the bank overdrafts.
 There is no fixed time period for paid back.
Drawbacks
 Interest rate is charged.
 The loan must repaid on agreed date.
 The loan amounts can affects the business gearing ratio.
Venture capital
The business can use the initial stages of business in uncertain situations. There are high
risk of failure the business so, the venture capital helps in return for the investors. It is the types
of private equity forms. It invests on the merging companies in exchange for ownership stake
and exchange for equity.
Benefits
 It invests large money in business.
 It also brings an expertise and experience along with the money.
 They get equal interest in business success.
Drawbacks
 The profits of business must share with the investors.
 The venture capital firms take control of business and strategic decisions.
 It is the complex and length process where the financial and business plan.

Bank overdrafts
It is provided by bank on the short term capabilities for current account holders. Its allow
company to withdraw more money than their bank accounts holds (Langemeier, 2019). The

interest has to be paid by business and amount overdrawn. It is most effective and ideal sources
of finance for the short term cash flow issues.
Benefits
 Quick and easy to arrange.
 There is no security require for bank overdraft.
 Interest is only paid when overdrawn.
Drawbacks
 Calculate cost of borrowing is difficult.
 There is limit to amount that can overdrawn.
 The overdrafts can be recall by the bank.
Retained earning
It is the undistributed profits of business and accumulated portion of business as well as
the amount of profit a company has left over after the paying income taxes, indirect cost, direct
costs, etc. as well as left after the distribution of dividends to its partners and shareholders.
benefits
 It is the permanent sources of funds that avail to business.
 It helps in enhance the capacity of company to absorb the unexpected loss.
 It leads in enhance the market price of the equity share of business.
Drawbacks
 The profits of business fluctuate and it is uncertain sources of finance.
 The business can fail to recognize the opportunities cost.
 It consists the imbalance growth.
M2
There are evaluated the various sources of funding such as venture capitals, retained earning,
owns capital, bank overdrafts and bank loans that are more significant sources of funds for the
SME business (Alkhoraif and Rashid, 2019). The Laynes business adopt the own capital and
retained earning for the sources of funds because the coffee shop not require the large
investments so, the company use the saving amounts and profits amount for business.

D2
Laynes business require the retained earning and saving or own capital for business because
there are no requirements of large amounts of investments so, the company will use the own
saving amounts and profits amount after paid all other costs.
LO3
P4
Business plan
Vision of company
Company will become the leading company in coffee shop and that will become the
largest cafe leading company in united kingdom.
Mission of company
The vision of company to provide customer fresh roasted coffee with quality services as
well a committed towards the environments.
Objectives
To serve the bets quality services to customer and providing them varieties of coffee as
well as treat their guest service in effective and friendly.
Goals of Laynes Espresso company
The main aim of company to provide the high quality drinks and comfortable furnitures
with internet provides that helps in attract more customers as well as creating an engaging
membership programs for customer (Das and Deora, 2019).
Stakeholders
There are various main stakeholders of Laynes company such as customer, employees,
suppliers, investors, governments and environments. The stakeholders help in manage the
business and service business because without stakeholders the business not able to run their
company (Lindeque and Samuel, 2022). The company improve its CSR corporate social
responsibilities to address the concern on the different stakeholders groups.
Capital funding
The business capital funding consist the both equity and debt and company use this
money for operating capital. There are various types of capital funding such as equity capital,
debt capital, retained earning, venture capitals, personal capital, etc. The Laynes is the coffees

shop company and it is the small medium enterprise's company. The company may be required
the 5000 to 25000 dollars and its is the initial amounts for coffee shop.
Budget plan-
Budget for Laynes espresso company
particulars Amount (in £)
Row material 3500
salary 4000
Marketing expenditures 2600
Ingredients 450
New equipments 6200
Administration expenditures 3500
Monitoring expenditures 2750
Total expenditures 24000
The company can raise their capital with the helps of various sources of funding such as
bank loans, bank overdrafts, own capitals, venture capitals etc. The Laynes company will raise
their amount from the retained earning and personal saving or own capital because the self-
financing helps in gives control to the own company rather than other finance control (Owusu
and Ismail, 2020). There are no requirements of borrowing money as well as there is no interest
payments need to make.
The company can also raise capital through the retained earning because it is also easily access.
It helps in enhance the stock value and it helps in boost the corporate liquidity as well as funding
for growth.
4Ps of marketing plan-

 Products- Laynes Espresso coffee shop would be offering flavoured coffee, soft ice
cream, breakfast, lunch and sugar free coffee products consist a range of items such as
caffeine, candy, desserts, etc. The products will be made in chef with the flavoured ingredients in order to meet the
need of such customers who are drinking coffee on daily basis. Pricing- As Laynes Espresso decided to go with “penetration pricing policy” so in initial
phase the prices will be kept lower, so the market can cover with the significant customer
where prices of competitors also will be considered and focus. Promotions- To promote the new products and services of company a holistic approach
has to be applied where both non-traditional and traditional approaches shall be practical
(Lahtinen, Dietrich and Rundle-Thiele, 2020). For marketing the products the social
media platform are more relevant and real marketing.
 Place- the products will deliver at cafe to customer at the relevant time and provide them
at customer place.
Technology plan
 In the technology plan for Laynes business that there are various technology which must
adopted by the coffee shops to sustain in the competitive marketplace.
 The company should establish the engaging and responsive app for the company where
customers can know about the company, and they can connect with company for work
efficiently.
 The customer also can improve the customer experience data collection technology that
helps in that cafe can send the personal message to customer such as birthday and attract
them towards the business.
 The company also provide the convenient payments options to customer such as credit
and debit cards options.
 The company also have to provide the online ordering systems to their retain customer
and that convenience bring more coffee lovers.
SWOT analysis- to analyse some associated aspects of the coffee product SWOT analysis is
being carried out as-

components
strengths  Having good quality to produce it.
 The sugar free products with flavoured
can be offering on lower prices.
 It will help to meet demands of
customers.
weaknesses  The sugar free coffee products are not
offered ever by it.
 It is a new product so there is low
customer's awareness.
opportunities  May get larger share of the market
(Benzaghta, 2021).
 Company can improve the products by
hiring the better chef.
threats  Low prices may flowing issues.
 There may be insufficient result from
the customers.
M3
For the Laynes company the vision, mission and its objectives as well as capital raising, budget
plan and technology plan are also evaluate for growth planning. The capital raising are own
capital and retain earning for securing investments with the business stakeholders.
D3
The business objective can achieve successfully through the business plan that are most
important for formulate and achieve business objectives and goals successfully. The company
will adopt the new strategies and comes with new products and developments that helps in
achieve effectively.

LO4
P5
Exit or succession options-
While introducing a new business plan there is necessity to appraise all available exit or
succession plans in command to guide entity correct.
There are various exit policies available for Laynes coffee shop business-
Pass to family-
With the helps of passing business in family helps in continuing the legacy in the family business
(Kaciak, 2021).
Benefits-
 There are no requirements of take drastic and rapid decision that helps in makes it's
effective to get exit.
 This strategy is most reliable rather than company intimacy.
 This decision never take long time.
Drawbacks-
 There are the lack of competency and it can affect the business.
 Irrational and rapid decisions are also taken place.
 Due to the competent family, business can go in loss.
Selling business to a friendly entity-
This is the most general plan having some benefits such as-
 The business plan would not hinder and would be carried out.
 For the smallest enterprise it is the easiest way.
 It is the best opportunity for business to get back business.
Drawbacks-
 If the market face the large competitiveness in corporate than there is no business friends
for the company.
 Selling business to friends can damages to the business plan.
Become part of acquihire

This strategy is the traditional acquisition because its retain the talented and skilled employees.
Benefits:
 It is beneficial for employees successful future.
 Company not have to worry about the obligations and responsibilities.
Drawbacks:
 The company can lose their company legacy.
 This process is costly, difficult and time-consuming.
Contingency succession option-
Benefits-
 In the emerging condition it is the most helpful for business.
 It is best for unpredictable situations and it is taken as considerations.
Drawbacks-
 For applying the existing plan their must be crisis which is having its bad and negative
repercussions too.
 In such difficulty a business may take unproductive or wrong decision.
M4
Laynes company can pass business to its family business because it helps in generate
profits as compare to selling business to friends. It is beneficial for the company that they will
pass their business to family for gain business succession. From the analysis above it is
recommended to the structure that it must go with selling business to family (Pickard, 2019).
Since pass to family will be helpful to expand the business. There are a range of goodness to
practise it such as pass business to family would eliminate market competition and will setting
way to make faster growth of business.
D4
The exit and succession options are best for business to pass their business to family
because it is the small enterprise and that can easily recover with the family business so,
recommend that they should pass their business to family gain recover and business succession
in the competitive marketplace through the family business.

RECOMMENDATION
 The company should adopt the exit or succession strategy to pass business their family
for regain the market share and profits.
 The company should use the retain earning and personal saving for the sources of
financing.
 The small business should evaluate the porter five forces for critically evaluate the
competitive analysis of business.
 The company should provide other quality services to customer for better growth and
developments opportunities for business.
CONCLUSION
As the conclusion, planning for growth for Laynes Espresso coffee shop company at
united kingdom comes with the new flavoured coffee for business growth. The report elaborated
the competitive advantage with the competitive frameworks such as porter five forces and VRIO
framework. The report also discussed the business plan and sources of funding that helps
business to raise funds for planning growth as well as suggested the exit or succession plan such
as pass business to family, selling to friends and become the part of acquihire. Recommend to
company choosing the best option for business through pass business to family.

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