Planning for Growth: Evaluating Opportunities, Funding Sources, and Business Plan

This report covers key considerations for evaluating growth opportunities, opportunities for growth applying Ansoff’s growth vector matrix, potential sources of funding available to businesses, designing a business plan for growth, and exit options for a business. The report uses Prufrock Coffee Limited as an example to demonstrate the understanding of competitive advantage within an organisational context.

Planning for Growth

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
TASK 1............................................................................................................................................3
P1 Analyse key considerations for evaluating growth opportunities and justify these
considerations within an organisational context..........................................................................3
P2 Evaluate the opportunities for growth applying Ansoff’s growth vector matrix...................5
M1 Discuss the options for growth using a range of analytical frameworks to demonstrate the
understanding of competitive advantage within an organisational context.................................6
D1 Critically evaluate specific options and pathways for growth, taking into account the risks
of each option and how they can be mitigated............................................................................6
TASK 2............................................................................................................................................7
P3 Assess the potential sources of funding available to businesses and discuss benefits and
drawbacks of each source............................................................................................................7
M2/D2 Evaluate potential sources of funding and justification for the adoption of an
appropriate source of funding for a given organisational context...............................................8
TASK 3............................................................................................................................................9
P4 Design a business plan for growth that includes financial information and strategic
objectives for scaling up a business.............................................................................................9
M3/ D3 Develop an appropriate and detailed business plan for growth and securing
investment, setting out strategic objectives, strategies and appropriate frameworks for
achieving objectives...................................................................................................................12
TASK 4..........................................................................................................................................13
M4/D4 Evaluate exit or succession options for a small business comparing and contrasting the
options and making valid recommendations for implementation of the chosen option............14
CONCLUSION..............................................................................................................................15
REFERNCES:................................................................................................................................16
Books and Journals:...................................................................................................................16
Online-...........................................................................................................................................17

INTRODUCTION
Every organisation plans for the growth within their industry. Hence, it is essential for the
companies to plan and make those strategies which help them to grow well within the market. It
is essential for companies to scan their current environment to analyse their opportunity for
growths and also to analyse threats to defend (Fayyaz and et. al., 2020). Prufrock Coffee Limited
is a busy cafe based in Central London and it is founded in the year 2010 and currently it
employs 7 employees (About PRUFROCK COFFEE LIMITED, 2022). The speciality of this
cafe is coffee, seasonal food and SCA training. The following report covers key considerations
for evaluating growth opportunities and justifies these considerations within an organisational
context, opportunities for growth applying Ansoff’s growth vector matrix, potential sources of
funding available to businesses and their benefits and drawbacks. It also covers a business plan
for growth which includes financial information and strategic objectives for scaling up a business
and exit options for a business and the benefits and drawbacks of each option.
MAIN BODY
TASK 1
P1 Analyse key considerations for evaluating growth opportunities and justify these
considerations within an organisational context
Few of the frameworks will be used to analyse growth opportunities for an organisation and
these frameworks are mentioned below-
PESTEL analysis-
Political factors- It consist of political stability of a country, their trading restrictions and
many others (Liu, Lee and Lee, 2020). In context of UK, they are having well stabled political
condition and there is less or no trading restrictions for the UK based companies. Hence, in
context of Prufrock Coffee Limited, they can import high quality of coffee from other countries
and export their coffee beans to the other nations which is supported by UK's trading policies.
Economic factors- It consist of employment rate, infrastructure condition, GDP and
many others. In context of UK, they are having high employment rate which help the chosen
company to hire skilled and talented employees for the operations of their cafe. Most of the cafe
and coffee shops are well designed and having well infra structured facilities. Hence, the good
quality of infrastructure of UK will help the Prufrock Coffee Limited to improve their interior

well to attract more customers. On the other hand, the cost of the raw material in UK is high
which is one of the biggest disadvantage for the chosen organisation to grow well.
Social factors- It consist of purchasing power of customers, their lifestyle and many
others (Mendling and et. al., 2018). In context of UK, the customers are well aware about their
consumer rights and they can raise their voice against of any unethical practices by any
company. Therefore, Prufrock Coffee Limited is required to offer quality coffee to their
customers and make them satisfied to grow their business well.
Technological factors- UK is well known for their technological factors and hence, the
chosen company can use this factor for their business development. They can purchase coffee
maker and other technological tools which can help them to prepare coffee with great taste and
faster to serve customers. On the other hand, they can also use social media marketing for their
promotional activities. Selling their coffee through online can also help them to gain more
customers because today most of the customers prefer to buy products through online mode.
Environmental factors- It is essential for the company to focus on environmental factor
and perform those activities which will help them to protect their environment and provide
benefits to social groups of communities. In context of chosen cafe, they can provide their coffee
in the disposable cups which is made up of crop cultivation waste. This will provide benefit in
many ways, first it will help to protect environment because when such cups is burned then it
will not produce harmful gasses in the air and secondly, it will also help farmers to manage their
waste of cultivation effectively.
Legal factors – It is essential to follow legal laws and regulations appropriately (Seles
and et. al., 2018). In context of UK, they are having few strict laws and regulations for the
companies so that they will maintain discipline in corporate sector and the employees or labours
will not get exploited. For example, Health and Safety Act 1974, states that employer will focus
on the health of their workers and make sure that they will not work in unsafe condition which
can impact bad to their health. Hence, according to this law, the mentioned cafe is required to
place fire extinguisher at their kitchen to protect their workers from any uncertainty related to
fire.
Basics of competitive advantage for business
It is important for a business to focus on their competitive environment and analyse the
competitive rivalry among their industry. Analysing about competitors and their strategies will

help a business to develop their strategies which can further help them to attract more customers
than their competitors and achieve a position of leader in the industry (Iqbal and et. al., 2018).
Becoming the leader of the industry is having various kinds of benefits for example highest
brand image within the industry and the customers can easily trust the company. On the other
hand the leader of the industry has power to influence other company’s decision making process
within the industry.
P2 Evaluate the opportunities for growth applying Ansoff’s growth vector matrix.
Ansoff growth vector matrix is a tool which is used by firms to analyse and plan their strategies
for growth. The elements of ansoff growth vector matrix is mentioned below-
Market penetration- This is the situation where a company mainly focuses on
increasing the sales of existing product within an existing market (Anzoategui and et. al., 2019).
In context of Prufrock Coffee Limited Company, it is essential for them to promote their coffee
varieties effectively within the UK market by using effective promotional tool. Promoting the
coffee will help them to gain the attraction of customers. They are required to focus on that they
will not convey the message through their promotional activities which will harm the personal
feelings or traditional culture of their customers.
Product development- This is one of the most used strategy for growth by most of the
companies where companies focus to develop their product portfolio within their existing
market. In context of Prufrock Coffee Limited, in case they are adopting this strategy for their
growth then they have to focus that they will start selling only those alternatives which are
having high demand in their existing market.
Market development- Here, companies are focusing to enter a new market with their
existing product (Jo and Zubairy, 2021). In context of Prufrock Coffee Limited, this strategy is
not appropriate to adopt because they are not having enough financial sources as well as other
essential resources for international growth. Hence, they are required to first develop their
business well within UK and than they should plan for international expansion of their business.
Diversification- This is the growth strategy where a company focuses to target to new
market with new product and this strategy is also considered as one of the most risky strategy for
companies. This strategy is commonly avoided by the companies because it need a huge
investment as well as research.

From the above information it is critically evaluated that the Prufrock Coffee Limited
Company can develop their business by using market penetration and product development at
recent period of time. Once they gain a huge market share then they can plan to expand their
business by targeting other market places.
M1 Discuss the options for growth using a range of analytical frameworks to demonstrate the
understanding of competitive advantage within an organisational context.
In context of Prufrock Coffee Limited, they can grow their business by using various
kinds of framework such as PESTEL analysis, ansoff matrix and many others. Through these
frameworks the company can analyse their growth opportunities like effective employment rate
of economic factor will help the business to hire skilled and talented employees which will help
them to perform their business activities more effectively (Von Delft and et. al., 2019). On the
other hand, using high quality of tools and machines will also help the company to produce
qualitative and tasty coffee with lesser or no wastage. In context of ansoff matrix, Prufrock
Coffee Limited Company can adopt market penetration which consists of offering existing
product within the existing market. All these growth opportunities can help the company to gain
competitive advantage and become the leader of the industry.
D1 Critically evaluate specific options and pathways for growth, taking into account the risks of
each option and how they can be mitigated.
A company can grow by various manners like they can hire highly skilled and talented
employees to conduct their business activities with expertise. The risk related to this growth
opportunity is that the company has to invest high for providing high salaries and wages to
skilled and talented employees (Fichter and Tiemann, 2020). This risk can be mitigating when
the company work according to a particular budget and save their cost through managing
wastage effectively. Another growth option for Prufrock Coffee Limited Company is product
portfolio where they can introduce new varieties of food products within their menu to gain more
customers. The risk related to this growth opportunity is that it might be possible that the
company may choose wrong food varieties within their menu. This risk can be mitigating when
the company will conduct effective marketing research before choosing the product to add in
their menu list.

TASK 2
P3 Assess the potential sources of funding available to businesses and discuss benefits and
drawbacks of each source.
It is essential for a business to manage funds for their business operations so that it will
be conduct smoothly. Hence, a business is required to choose effective source of fund by
comparing various options available within the market. Few of the sources of funding for a
business is mentioned below-
Funding from personal savings- Most of the small businesses use this option for funding their
business activities (Dal Mas and et. al., 2021). This is the amount which is invested by owner
from their own pocket.
Advantages of using personal savings-
 There is no risk of debts in this funding source. A business owner can make any amount
of investment at their own will.
 This source of fund can also used in emergencies. For example, an owner can invest the
money in business at anytime whenever he wants.
Disadvantages of personal savings-
 Owner has a risk of losing all money in business which he invested if the business did not
work according to plan.
 There is lack of transactional records in using personal saving in business.
Business loan- A businessman can also use banking facilities to finance their business (Jukova
and et. al., 2019). There are various commercial banking facilities which help a business to use
business loans as per their business requirements.
Advantages of business loans for SMEs-
 It is easily available and can be used by any type of business. There is almost every bank
which can help a business by providing them effective banking facilities.
 There are multiple banking loan options, hence a owner have the advantage of comparing
these each banking loans from different banks and use them as per their requirements.
Disadvantages of business loans for SMEs –
 Every bank asks for business plan first to provide business loan to any SME so that the
bank will analyses whether the business has scope for future growth or not (Cadena and

et. al., 2020). In case the business plan is considered as ineffective by their banks then
they will deny providing loans to that business.
 A business owner has to complete various kinds of formalities while taking a business
loan and it is also one of the most time consuming process.
Angel Investors- These are the individuals who show interest in business and the businessman
did not know them personally. They show their interest in business and invest in them because
they are expertise in the industry. They can analyse very well that which kind of business can
grow in future and which did not. Their prediction level is high and successful.
Advantages of angel investors-
 They make investment decision quickly. For example, if they supposed to invest in a
business than they perform investment procedure as quick as possible with all legal
formalities without putting any burden on owner.
 They are having high knowledge and good level of network for the business due to their
expertise (Inkon, 2019). Hence, this will help the chosen organization to grow faster with
effective knowledge of angel investors.
Disadvantages of angel investors for the business-
 The biggest disadvantage of using angel investor option for funding a business is that the
angel investors gain complete control of business in decision makings. Hence, an owner
has to provide them power to make decision for their business for using their
investments.
 Secondly, angel investors are too quick to invest in business that the business owner did
not get enough time to think that which investor is good for them and which is not.
M2/D2 Evaluate potential sources of funding and justification for the adoption of an appropriate
source of funding for a given organisational context.
There are various kinds of sources of funds available within the market like equity funds
which is the personal savings of owner, banking loans, angel investors and many others (Chirico
and et. al., 2020). In context of Prufrock Coffee Limited, they can use banking loans as an
effective source of funding for their business because banking loans can help them to retain the
authority to make decisions. Secondly, there are various kinds of business loans available in
market. Hence, the business has the option to compare their pros and cons and then choose that
business loan only which is having more benefits than others. Even, nowadays, banks are also

offering low interest rate loans so that the businessman will not get burden of repaying the loan
with huge interest rate.
TASK 3
P4 Design a business plan for growth that includes financial information and strategic objectives
for scaling up a business
Executive Summary This is the business plan of Prufrock Coffee Limited which is based in
UK. This business plan will help the company to grow well. The
objectives are as follows:
 To help the company to analyse their growth strategies.
 To mitigate their obstacles and grab all opportunities for
effective growth.
Company Description The founder of Prufrock Coffee Limited company is Jeremy Challender.
It is having less than 10 employees but is is planning to grow well by
offering their customers coffee which is full of quality and taste. This
will help them to gain their customers satisfaction.
SWOT Analysis Strengths
 The taste of coffee is their biggest strength.
Weaknesses
 They are lacking behind to manage their financial areas.
Opportunities
 Better promotions of business will help to gain more customers.
Threats
 The major competitors and industrial leaders like Starbucks and
many others are creating biggest threat for the Prufrock Coffee
Limited.
Market Analysis It is essential for mentioned cafe to analyse the marketing condition to
grab the factors for growth. STP model of the chosen business in
mentioned below-

 Segmentation: It consist of dividing market into various parts. In
context of the company, they can choose both male and females
of age group 16-26, 26-36, 36-46, and 46 and above. Middle
class and low class customers are also segmented.
 Targeting: Here, they target young generation basically from 16-
36 year of age group of both males and females. The prices of
their coffee is low hence, they target low class people.
 Positioning: For maintaining positive brand image they can
promote their products through social media channels and gain
feedbacks from their customers to analyse needs for change.
Marketing/Sales
Strategy
Marketing strategies: Here, company will focus to promote their brand
and aware their customers about their offerings (Lee and Mukoyama,
2018). In context of Prufrock Coffee Limited, they can use social media
channels and word of mouth by offering quality and tasteful coffee to
their customers.
Revenue sources: The cafe can earn more revenue if they offer snacks
with coffee and develop their product portfolio.
Sales strategy: They can use discounts on occasional days for increasing
their sales.
Pricing Strategy: keeping the prices lower than competitors but
maintaining the quality will help the company to gain more customers.
Marketing and Communications Strategy: The chosen cafe can use
digital mediums to communicate with their customers and collect their
feedback.
Research and
Development
Technology roadmap: It is seen that the company can conduct research
by using technology road map. They can monitor the trends using this
roadmap.
Research and Development: The research and development department
will help the company to analyse the marketing trends.
Technical partners: Social media websites are technical partners of

business organisation.
Trade mark: This assures that no one will copy their business idea and
products.
Staffing and
Operations
Employees are the essential asset of an organisation which help the
company to perform their operational activities in a appropriate manner.
Management organisational chart: Divisional structure can be
followed within the chosen organisation for dividing task between
companies according to the expertise of employees.
Staffing and training plan: The CEO is responsible to hire new
employees for the company.
Operations: The main work of Prufrock Coffee Limited is to provide
quality coffee to their customers.
Financial projections: It is most essential for a business to manage their financial activities and
prepare a budget for them to conduct their business operations appropriately.
Marketing budget
Particulars 1st year 2nd year 3rd year 4th year 5th year
Initial money 7000 7500 14000 15500 17350
Investment 11000 12000 23500 31000 16500
Total 16000 19500 37500 46500 31850
Marketing outlay
Promotion 5500 2200 4100 3200 3150
Sales publicity 2100 2000 4300 2500 2000
Direct selling 4100 2200 7000 4000 4450

Total 11700 6400 15400 9700 9600
M3/ D3 Develop an appropriate and detailed business plan for growth and securing investment,
setting out strategic objectives, strategies and appropriate frameworks for achieving
objectives
Business plan for Prufrock Coffee Limited-
Objectives-
 To gain the trust of customers and attract them toward the business by offering them
quality and tasty coffee.
 To gain competitive advantage by expanding the business well and hiring most talented
employees within the café.
4ps of business-
 Product- They can sell tasteful and fresh coffee to their customers (Sardeshmukh,
Goldsby and Smith, 2021). They are also having scope to expand their product portfolio
by selling various kinds of healthy soft drinks and baked snacks.
 Price- It is considered that the price of the food products of the chosen café will be lower
than other competitors within the industry. Customers are attracted to those café which
are offering verity of products in affordable prices.
 Place- The chosen café can choose London and Birmingham locations to open their café
because these are one of the most populated area of UK. Secondly, they can also sell their
coffee through online.
 Promotion- They can use social media marketing as they are having global reach. Hence,
their promotional message can be reached by huge number of customers if they promote
their brand through social media channels like Instagram, Facebook and many others.
Resources required achieving objective-
 Skilled and talented workforce
 High quality of tools and machines
 Attractive designing of building and interior décor
 Intangible resources such as patent, trademark and many others.
Strategies to achieve objectives-

 To attract more customers, the chosen organization is required to promote their café and
its products as more as possible to aware customers and even use discounts schemes to
attract customers to reach at the café.
 They are also required to hire skilled employees and this can be only done after offering
them a good and attractive amount of salary.
 Unique services should be adopted by the company which is different from their
competitors to gain competitive advantage within the industry.
TASK 4
P5 Assess exit or succession options for a small business explaining the benefits and drawbacks
of each option.
There are various kinds of options available for a business to exit the industry and market and
these options are mentioned below-
Liquidation- This one of the commonly used succession option for a business where business
sell their business assets to recover their loans and debts (Beynon and et. al., 2021). The buyer of
the business asset is basically that individual or a group of individual or even an organization
which are the debtor of the company.
Advantages of liquidation-
 The owner is free from debt after liquidation process.
 It avoids court processes for the business to end up the business.
Disadvantages of liquidation-
 The business assets are sold on lower prices as compared to their actual selling price.
 The employees remain unpaid and the amount which is earned by selling the business
asset is spending to close all debts.
Selling business in open market- This is another popular option for leaving a business by its
owner (Amankwah-Amoah, Boso and Antwi-Agyei, 2018). Here, a business is sold in open
market to those individuals and a group of individuals who shown interest to purchase the whole
business and continue it with the additional resources which they have.
Advantages of selling business in open market-

 The buyers are easily available in the open market to purchase the well established
business.
 The brand image and brand value remain continue even after selling the business to other
party.
Disadvantages of selling business in open market-
 The business is sold on lower prices as compared to the expectation of owner. Lots of
negotiation statements are transferred between both parties.
 A lot of time gets wasted in searching those individual who can pay the amount for
business which is expected by owner.
M4/D4 Evaluate exit or succession options for a small business comparing and contrasting the
options and making valid recommendations for implementation of the chosen option
There are various exit options for a business like liquidation, selling business in open
market and many others. First is liquidation where the owner sells the assets of business to
another person and use this amount to pay their credits. Whereas second option is selling
business in open market which consists of selling established business to someone else who is
interested in buying it. The main difference between these two options is that in liquidation the
existence of business get finished and it might be possible that the asset will be sold to different
buyers but in the option of selling business in open market, the existence of business did not
get vanished, it get continued with different owner and the whole business is sold to single
individual. It is recommended for the selected business to choose selling business in open
market option because it will help the owner to sell the business at their own selected price.
Secondly, the demand of café in food and beverage industry is growing high; hence, there is a
good opportunity for the café seller to sell the business at high prices due to café’s high demand.
It is also recommended to the owner of the chosen café that he must contact to a business
specialist and ask the actual worth of the business which should be selected at minimum level to
sell. This will help them to set the prices not too high and not too low to meet the requirements
of buyers and sellers.

CONCLUSION
From the above information it is concluded that organisations are required to scan their
current environment and analyse the opportunities for growth. Gaining competitive advantage is
one of the most essential aims of an organisation. It is also essential for an organisation to
analyse effective sources of fund for their business which help them to expand their business
well and conduct their organisational task smoothly. There are various options of sources of fund
for a business such as banking loans, angel investors and many others. It is also concluded that
preparing a business plan will help a business to identify direction of business to achieve their
business objectives. It is also concluded that there are various kinds of exit option for a business
like liquidation, selling business into open market and many others.

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Online-
About PRUFROCK COFFEE LIMITED, 2022 [Online] available through:
<https://www.linkedin.com/company/prufrock-coffee-limited/>