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

This report discusses evaluating growth opportunities using Porter's generic and VRIO frameworks, opportunities for growth using Ansoff's growth vector matrix, potential funding sources with benefits and drawbacks, and a business plan for growth including financial information and strategic objectives for scaling up a business. The report also includes a PESTLE analysis for bringing a new product to market.

Planning for Growth

TABLE OF CONTENT
INTRODUCTION...........................................................................................................................3
1.Evaluating the growth opportunities from Porter generic framework......................................3
Evaluating the Growth opportunities from VRIO framework.....................................................4
2.Opportunities for growth applying Ansoff's growth vector matrix..........................................5
3.Potential sources of funding available to businesses with its benefits and drawbacks............6
4.Business plan for the growth including the financial information and strategic objectives for
scaling up a business....................................................................................................................8
5.Various exit and succession routes for small business withn its benefits and drawbacks......11
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
Planning for growth is the major aspect for every business entity as every business needs
growth in its work. It allows the business to make new and innovative product for increasing
growth in the market. Marshfield bakery is situated in Chippenham in United Kingdom. It has
almost eight two employees at this location in U.K. This report will outline the key
considerations for evaluating growth opportunities and justifying those considerations within the
organization and opportunities for growth applying the Ansoff's growth vector matrix. Further it
will outline the potential sources of funding available to the businesses with its benefits and
drawbacks. This report will also outline the business plan for growth which will include financial
information and strategic objectives for scaling up a business and exit or succession option for
the small business with its benefits and drawbacks.
1.Evaluating the growth opportunities from Porter generic framework
Porter’s generic strategy
This method is used by company in order to determine a competitive advantage across its
market and business scope. These strategies allow the company to gain benefits of
competitiveness from various bases. Marshfield bakery utilizes these techniques so that the
management of the company can plan about cost, uniqueness and quality products or services.
This method can be used by every organisation and applied to services or product.
Cost leadership- This strategy is used by the present company so that it can increase profits by
decreasing costs of the product or services. Marshfield bakery increasing its market share rapidly
by charging lower prices for their services. They are still making a profit margin offering
minimum cost. The company has achieved success when it involves being the leader in terms of

cost in the competitive market. If the company utilizes cost leadership strategy, then they can
easily access to the capital in order to invest in new technologies.
Differentiation- This method is used by the bakery to provide unique services or
products in order to attract the customers (Visedsun and Terdpaopong, 2021). Marshfield bakery
make their services different from other it involves features, quality, quantity and brand image.
The present company become successful with the help of differentiation method. The company
adopted research method, innovative idea in order to develop quality. The present firm offers
effective selling and marketing strategy so that the customer understands the benefits offered to
them.
Focus strategy- Marshfield bakery focus on this strategy by understanding the dynamics of
market and the unique needs of customers as per their taste, preference and interest. They
become successful in developing unique product at low cost. It includes that the company is
adding something extra as a result of serving facilities to customers and market niche.
Evaluating the Growth opportunities from VRIO framework
VRIO Strategy
The bakery offers food items such as cakes, pastries and other flour-based items. The
company major strengths include experienced staff, used latest equipment’s and offers variety of
products or services (Ariwibowo, Saputro and Haryanto, 2021). VRIO analysis is method used by
present firm in order to maintain competitive advantages. This strategy helps to identify the
capabilities and resources that give company’s sustainable advantages in order to compete in the
market. With the help of this technique company can evaluate the various resources in an
effective way. The firm can evaluate the weaknesses so that proper action can be taken.
Value – The company needs to create a strength for the business in relation to other
company. For being valuable the company must follow better process, supply chain
management, strong access to raw material supply, brand recognition and reputation, better and
skilled employees.
Rare- If the resources are not easily purchased on the market by competitors of the
company. It indicates that there is rare or limited supply of that resources. Thus, this method is
called rare resources.

Inimitable- A resources are called inimitable when there is no substitute at low price or it is
not easy for other to make duplicate products or services. It is said that high brand or reputation
of the company with positive organisational culture can be involved here.
Organised- If the company take full benefit of resources that are rare, valuable and
inimitable in nature then it is known as organised. Here, Marshfield bakery will need to change
its focus strategy in order to pursue full advantages to compete in the market.
Resources value rare inimitable organised
Differentiation yes yes yes yes
Focus strategy yes No yes yes
Competitive
advantages
yes yes yes yes
Sustainability yes yes No yes
2.Opportunities for growth applying Ansoff's growth vector matrix
Ansoff's matrix is a technique that provides a tool for planning which helps the heads of
the organizations like seniors managers and executive to plan for the growth of the business
(Loredana, 2017). There are four types of growth strategies which helps the Marshfield Bakery
to get an opportunity for growth. The four strategies of Ansoff's matrix are:
Market penetration: In this strategy, the company makes and increase its market share in
the existing market only.
This basically involves that company will increase its market share with its existing
products and services. This strategy has advantage that it can be used by finding the new
customers in the market and selling its existing products and services.
Marshfield can use this by decreasing the price of product for selling more in the market
and increasing market share so it is drawback that company will reduce the prices.
Market development: In this strategy, an organization decides to do expansion of its
business in the new markets that can be new country or and geographical areas (Filippov, 2017).
By doing this company can increase its customers and make and expansion of its business
in the foreign markets so it is the big advantage for the entity. This strategy can be used by the
bakery in order to plan a growth of the organization.

Product development: In this strategy, the organization tries to bring new product in the
already existing market in which the firm is doing its business.
It requires to have investment to bring new product in the market by doing proper
research and development of the macro-environment so it is drawback for the company.
There is advantage that company can do joint ownership with another company if both
the companies are agreed in order to bring new product in the market. The cited organization can
use this option for introducing the new product in the existing market.
Diversification: In this strategy, the company expands its share in the market by
introducing something new in the new market.
It has disadvantage like it is most risk strategy of the matrix as in this both product and
market are new for the company but it has advantage that company can expand its business in
new market. There are two types of diversification that are related diversification and unrelated
diversification. If the organization wants to expand its business by producing new product in the
new market than company can use this strategy option for planning of growth for the entity.
For the Marshfield Bakery, the product development strategy is the best option to expand
its market and plan for the growth in the existing market. As company want to introduce some
new and innovative product in the market so for developing that product company can use this
development strategy option. On the basis of this strategy the company is bringing the new
product in the existing market which helps the company to grow and increase its market share.
The company can also use joint ownership with the other firms which will help the company in
the investment for introducing the new product for expanding its business. This is somehow
risky for company as it is introducing new product in the market.
3.Potential sources of funding available to businesses with its benefits and drawbacks
Organization always wants the sources of funding in order to expand its business in the
competitive market. There are various funding available for the organization which includes the
following:
Loans: These are the most used funding used by the organization in order to increase the
market growth and market share. If the company wants to do make its business for the long-term
than company can take loans from the banks (Yigitcanlar and et.al., 2018). There are some
benefits and drawbacks of this source of funding which are as follows:
Benefits

1.The company can take large amount of money from the bank and can use that money to
expand its business.
2.Interest rates of the bank are lower than the loans taken by other loaning sectors.
Drawbacks-
1. For taking the loans from the bank collateral security is needed.
2.The company has to pay interest amount also with taken amount as it affects the
profitability.
Hire-purchase: This sources of funding allows the organization to use an asset without
paying full for that asset(Nippa and Reuer, 2019). In this the company has to pay monthly
amount in order use that asset. After giving all the instalments of that asset the company owns
that asset as of its own. There are benefits and drawbacks of this source:
Benefits
1. It makes the company to use that product without paying full amount of that asset.
2. Instalments are easy for the company to pay rather than to pay the big amount for purchasing
that asset.
Drawbacks
1. The ownership of that asset remains with the lender till the payment of last instalments.
2. With paying instalments the organization has to pay interest amount as well.
Venture capital : It is the source in which capital is given at the starting stage of the
business for any uncertainty. This is contributed in order to gain high return in the future. The
investor expects that the organization will give higher return and will earn good profit. It has
some benefits and drawbacks which are:
Benefits
1. The investor invests large amount of money in the starting stage of the business.
2. This makes the company experience and expertise that how to start the business.
Drawbacks
1. The earned profits of the company will be shared with the investor.
2. It is very hard and complex process to start the business and to manage the
financial position.
Bank overdraft: In this source of funding, the company can take short term credit facility
from the banks and the company must be having current account in the bank (Blut, Teller and

Floh, 2018). This allows the organization to withdraw the money more than there available
balance. Some benefits and drawbacks of this source are:
Benefits
1. The company is not required to give any collateral security in order to take more.
2. The company can easily arrange the amount required to them.
Drawbacks
1. Bank overdraft facility has also the set limit beyond that limit company cannot do
overdraft.
2. Interest rates are high as compare to the loans taken from the bank.
The organization can take loan from the bank to make the potential sources in order to
make something new and innovative product in the market. In this interest rates lower than
compared to bank overdraft which company can will manage to pay. If the company wants large
amount than it can borrow from bank no set limit is there in taking loans.
4.Business plan for the growth including the financial information and strategic objectives for
scaling up a business
A business plan is a statement or planning which helps the organization to know what
they have to do in there business (Elavarasan and et.al., 2020). Marshfield bakery is the
organization which was started in 13 January 2005 in Chippenham. It is an active company since
from it is incorporated and started its business. The organization is introducing a strawberry
sugar-free cookies as a new product which helps the company to increase the customers who
prefer to eat sugar-free products.
Vision of the company: A vision statement describes the importance of product that why
this product is launched in the market. The vision of the company to differentiate its bakery
products from its competitors in the market.
Mission of the company: A mission statement is for short term in order to make the and
increase the profit of the company. It tells the customers about the new product that is sugar-free
cookies which the organization is introducing in the market.
Objectives: The objectives of the business are as follows-
1. It tells the organization where it is and where it has to be in the future.
2. It increases the effectiveness in order to bring the new product by the company in
the tough market.

3. The company must earn at least 70% of profit by introducing new product.
PESTLE analysis of the company
PESTLE analysis refers to the factors which are political, economical, social,
technological, legal and environmental factors which affects the market in order to increase
the profitability of the company. The PESTLE analysis for bringing new product by the
company is as follows:
Political- These factors are related to the areas
covering tax rates, labour laws, trade
restrictions, tariffs etc. There is interference of
the government in order to bring new product
in the market.
Economic- This includes growth rate,
exchange rates, inflation and deflation rate,
interest rates in the market (What is PESTLE
Analysis?, 2021). The company must check the
growth and market rate in order to bring new
product in the market.
Social- These factors includes health
consciousness, population, age etc. as the
product is sugar-free it helps the diet conscious
people to buy that product.
Technological- It includes the change in
technology by bringing automatic machines for
the production. The company can bring
automatic machines in order to produce the
new products at a large scale.
Legal- It includes the laws related to
consumers, discrimination law, employment
law, safety law etc. (Phan, 2021). The
company must give quality of products which
does not affect the right of the customers.
Environmental- It includes weather, change in
climate which affects the quality of the
products. As in summer seasons the cookies
taste changes and get rotted which makes the
consumers to buy less in that season.
SWOT analysis of Marshfield Bakery
Strengths- It includes brand name of product,
uniqueness of product, technology used etc.
For bringing new product company must
ensure that the product should be unique in the
market.
Weaknesses- This includes the weak points of
the company (Swot Analysis: What it is and
when to use it, 2021). The company must see
the weakness in order to bring the new product
in the competitive market.
Opportunities- This includes the opportunities Threats- Threat for the company includes

of the company increase its profitability. To
bring that sugar-free product it creates an
opportunity for company as diabetic patients
can buy that products.
factors affects to bring something new in the
market. The organization must check its
competitors and their products before
introducing the new product in the market.
Marketing mix of the organization
Marketing mix are the actions that company uses in order to promote its new products
and brand in the competitive market (Rosado-Serrano Paul and Dikova, 2018). It includes the
4P's that are place, price, product and promotion. Marketing mix of the company are:
Price: The organization must decide the price of the new product according to the quality
of the cookies and quantity of cookies in one pack.
Product: The quality and Quantity of the new product must be good as customers will
buy product having good quality and quantity.
Place: It makes the company to know where to sell there new products who are their
customers.
Promotion: It can be done through advertisements or by selling samples of the packets
free to the customers in order to promote cookies.
STP Approach
Segmentation: the organization must check the market and select the target market in
order to sell its new product.
Targeting: The target customers of this new product is mostly the diet conscious people
and diabetic people.
Positioning: The organization can use the tag line as healthy cookie at wealthy price,
which attracts the customers to remember that product and buy that product.
Budget of the organization
Resources Amount
Raw material 120000
Wages 5000
Marketing expenses 2500
Total 125700

Monitoring and controlling
Monitoring and controlling is the process which helps the company to monitor and check
the achieved goal with the planned goal. Marshfield bakery is bringing the new product so it
must monitor and control the profit of the company as how much profit is increased by bringing
new product in the competitive market. This helps the company to know the achieved profit with
the planned profit.
Risk matrix with contingency plan
Type of risk Likelihood Impact Person
responsible
Contingency
plan
Technological
risk
3 2 Technology
department
If any machine
or equipment is
not working
than company
must have
substitute of that
technology to
continue the
production of
new product.
Market risk 4 3 Research and
development
department
The R&D must
check the macro
environment and
consider the
solution of the
market risk in
order to bring
new product.

Scaling up the business plan
Scaling up the plan of the business defines that how the company will handle the with the
increasing work, increasing sales in the effective manner. Some tips are:
1. The company must analyse the new product with the competitors before bringing
it in the competitive market.
2. The company must ensure about the quality and quantity of the new product
which satisfied its customers.
5.Various exit and succession routes for small business withn its benefits and drawbacks
The various exit and succession routes for the organization are as follows:
Merger and acquisition: In this route on company merge with the another company or
acquire the shares of another company in order to take ownership of the another company. It is
one of the most common used strategy route used by the small business. In order to the
acquisition, the owner of the company decides the price in order to acquire the industry. Some
benefits of merger and acquisition are:
Benefits- Creates an opportunity to increase the share in the market. It divides the risk
and loss by merging with another company.
Disadvantages- It increases the legal cost of the company. By merging company lost its
name and new opportunities.
Joint venture: In this route the one company do partnership with another company for a
definite period till the goal is achieved. It is a type of collaborative business in which companies
collaborate in order to achieve more profit by doing the same type of business (Nippa and
Reuer, 2019). The risk and profits are share between them in their sharing ratio. Benefits and
drawbacks of this route are:
Benefits- It creates an opportunity for the company to have better and innovative
resources. Both the companies shares the risk and required cost for doing that venture.
Drawbacks- Both the parties may not invest equally which is the greater disadvantage
for the company which is investing more. Objectives may vary of the company for doing that
venture.
Franchising: In this route, the concept can be taken by the company in order to expand
its business organization. It requires the licence in order to take control of the franchise. There is

an agreement between both the parties as profits are required to be given to the franchisor. There
are some benefits and drawbacks of franchising are:
Benefits- Risk of the organization reduced by giving license to another firm. Can use the
name and trade mark of the already existing business which makes the company to earn more
profits in the market.
Drawbacks- To enter this route the cost required sometimes is very high as the franchise
products are always costly. Profits of the organization is to shared with the franchisor.
The cited organization can use merger and acquisition exit and succession route. By this
the company can merge with the another company and increase the investment of the company
and earn more profit in the competitive market. The organization can also acquire the shares or
asset of another firm in order to increase the profitability of the business. As this route has some
benefits like it makes the company to increase the share in the market and also to share the risk
between the agreed companies.
CONCLUSION
To conclude, every entity needs growth in its business and it allows to make innovative
products in order to increase market strength. By evaluating the report, it is summarized that
Ansoff matrix technique is used by company to plan for business growth. The company focus on
vision mission statements in order to achieve future success. With the help of pestle and swot
analysis company determine various factors, weakness and strength of the firm. Marketing mix
and segmentation of the company helps to determine the customer base and target market. The
present company monitor and control planned goal to achieve competitive advantages. By
analysing the report, it is summarized that firm needs to focus on differentiation method.

REFERENCES
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Online
Swot Analysis: What it is and when to use it. 2021. [Online]. Available through:
<https://www.businessnewsdaily.com/4245-swot-analysis.html>
What is PESTLE Analysis?. 2021. [Online]. Available through:
<https://www.analyticssteps.com/blogs/what-pestle-analysis>