Planning for growth

Planning for growth

INTRODUCTION
A small business is said to an organisation which is understanding the needs and wants of
customers in small areas and provide them products accordingly. This is important for
management to focus on their activities and function so it can be operated properly (Cowan and
Eder, 2020). In competitive business environment it is suggested to management to take the key
consideration which can help to take growth opportunities and enhance the business in other
country. Every organisation has dream to operate their business and increase the profitability by
growing business. For this, it formulates different planning and strategies in managing task and
activities in business environment and develop the business. The growth of business mainly
depends on funding resources, planning, analysis of factor, competition and marketing strategy
that should be develop by company for attaining advantages. This report is based on The Coffee
Roasters that is small size organisation in UK providing special coffee to customers with
different flavours which attracts customers and operating the business. The aim of organisation
to to capture larger market share and serve all over the nation by attracting number of customers.
Therefore, management of such organisation arranges business activities and develop planning
which can help to complete the goals. For taking growth opportunities and expanding business
this organisation is making plans and arranges funds which helps to maintain the activities. This
report covers understanding about key consideration for evaluating growth opportunities,
assessment of potential funding resources and a business plan by involving financial resources
and strategic objectives.
Task 1
Determination of growth opportunities and justification
Growth definition: This is the act and process which is required in small organisation
who have established and operating at small level. Growth is the way of increasing business size,
scope and organisational profitability in changing environment. A business concern always
thinks about development and growth of business by formulating plans and strategies that can
help to increase performance. The Coffee Roasters is small organisation that seek towards
growth by formulating plans and marketing tactics.
Competitive advantages is the benefited point for organisation for which company
develop plans and implement by considering their rivals that can help to attain the business goals
4

and objectives. The chosen organisation is suggested to use attractive and competitive planning
which can help to provide the competitive advantages.
A business is required to focus on their activities and function which can help to operate
the business and maintain the profitability by growing the business (Heymann and et. al., 2019).
Every companies wants to grow their business buy entering in to larger market and filling the
customer’s needs. The Coffee Roasters is small organisation, providing coffee in UK’s that
wants to increase their sale and business opportunities by expanding business in other country
and places. For growth opportunities PESTLE analysis is uses by such organisation that are as
defined:
PESTLE analysis – This is a tool which uses by small and larger size organisation for
operating business and finding which factor can affect their business activities. This helps to
state how each factor can impacted on activities and how it can manage the performance. In
context to The Coffee Roasters, this analysis is defined below:
Political factor – This factor is defining political rules and regulation which are made by
government involving trade tariffs, tax rates, labour regulations, government rules and regulation
that are important to follow. In UK, there are free trade tariffs and low tax rates which are giving
the opportunities to The Coffee Roasters to operate its business successfully and increase their
business in other country due to flexible regulations. This factor is giving the advantages to
expand their business sin challenging environment and maintain the performance (Onodugo and
Ezeadichie, 2019).
Economical factor – This is related to economy that involves inflation rates, interest
rate, employment rates, GDP rates, and other factors which arises at the time of operating
business. In UK, after Brexit the rates of interest are reduced as European countries are
eliminated their business which have taken the opportunities for small business to run and
operate by taking loans at less rates. The Coffee Roasters is operating its business successfully
and can grow in other place as low interest rates are having which helps to take the loans for
running activities. The chosen organisational is maintaining profits by increasing activities and
delivering best services.
Social factor – This factor is stating some aspects which are related to economy and may
support the business. The containing elements are education level changes in demand,, lifestyle,
fashion etc. that is important for organisation to manage the activities. In context to The Coffee
5

Roasters, the needs and taste of customers are changing on which management of such
organisational are focusing that help to operate the business and increase the profitability by
satisfying them. This can be opportunity for chosen company to operate and expand their
business effectively (Fang and Shaw, 2019).
Technological factor – This factor is illustrating technical services such as technology,
advancer activities, innovation etc. that are uses to provide the new products and services so
activities can be managed properly. The Coffee Roasters should uses new technology and
innovation in their coffee making process that can help to serve more customers in one time
which helps to grow the business. Moreover, growth opportunities is taken by organisation by
brining innovation in distribution process and channel that can help to reach the customers and
managing the performance in other places also.
Legal factor – The involvement of legal regulation such as employment, health and
safety, labour laws, data protection and any other laws are followed to operate the business. The
Coffee Roasters is operating the business by following all regulation and provide a satisfaction
that helps to maintain the activities and satisfy the customers who are working in organisation
that can be opportunity for business (Hall and et. al., 2019).
Environmental factor – The person and owners who are running is required to follow
the environmental rules that are important and increase the brand image in challenging
environment. The Coffee Roasters is uses cost management and inventory management rules by
reducing wastages that can help to operate the business and increase the activities by creating
opportunities.
From the above discussion about external factor and key consideration it has been
consider that all SME's should evaluate their growth opportunities by using PESTLE analysis
that can help to define that which factor may have affected the business. This can help to make
plans and strategies accordingly so can survive in challenging market and operate the business.
Moreover, this can help to conduct research about competitor and and understand business
environment that gives opportunities to establish business and make it successful.
Evaluation of growth opportunities by applying Ansoff growth Matrix
The meaning of growth is expansion and development of business by applying business
strategies and theories which can help to operate the business. For instance, The Coffee Roasters
is a small organisation that aims to grow and develop the business by selecting a best growth
6

option which are available in market. Therefore, a market analysis is required to evaluate the
growth opportunities in changing environment and develop the business. Ansoff’s growth matrix
is a tool which uses by chosen organisation for evaluating the growth opportunities that are as
defined:
Market penetration – The illustration of such strategy is related to sale of products and
services in existing market at low cost that can help to attracts the customers and increase the
organisational productivity. It can be opportunity for The Coffee Roasters to operate their
business in UK and existing market where is its already established by reducing the cost that can
help to operate the business and increase the profitability by increasing the number of customers.
With the help of this cost of organisation in producing, serving and delivering the products can
be save and maintain the activities properly (Sharma, 2020).
Product development – This strategy is related to bring new products and services
which should be provided by organisation in order to attracts the customers and increase the
buying process. This can be growth opportunity for selected organisation such as The Coffee
Roasters by introducing new products and taste of coffee as per customers demand that can help
to operate and grow the business in challenging environment. This can help to increase the
profitability and market share in business environment that supports to grow the business.
Market development – This strategy is related to growing the market by evaluating
opportunities and focusing on activities which can help to manage the activities and operate the
business successfully. In this, management is required to provide the products and services in
new market that can help to manage the activities and increase the sale by adding new customers.
The Coffee Roasters have option to use market development strategy that can help to operate and
increase the customers (Pınarbaşı and et. al., 2019).
Diversification – The growth of business is related to product development and market
development in which management bring new product in new market that can help to operate the
business and increase the profitability. This is highly risky and challenging for organisation to
manage the activities and functions which helps to operate the business. The Coffee Roasters can
be adopted by introducing new products in new market that can be opportunity for company and
increase the competitive advantages.
From the above, it has defined that The Coffee Roasters is adopting the market
development strategy by entering in to new market and expending the activities which helps to
7

operate the business and increase profitability. In market development strategy, management of
such organisation are selecting a market which can be opportunities for company and
maintaining high profitability. This is appropriate strategy that can help to develop and grow the
business by developing the market. Diversification can be more risky because it may be difficult
to select the right market and adding the new customers.
Task 2
Potential sources of funding which are available in businesses
Funds are important for business which can help to operate and continue the activities in
changing situation. This helps to perform all functions and fill the demand of business. The
sources of funds in context to The Coffee Roasters are as defined:
Bank Loan – This is defined a sources of funding which can be use by organisation for
arranging the fund that can help to operate the business and increase organisational performance.
The Coffee Roasters is having option to use bank loans by taking loans from bank that can help
to manage the activities (Weber and Sciubba, 2019).
Benefits – The Coffee Roasters can increase their activities and functions by arranging
funds that supports to run the business. By using this, managers can operate and increase the
performance.
Drawbacks – For taking loans there is requirement collateral security which can be debt
for person and business owners. This can be reduce the productivity as banks are charging high
amounts.
Crowd funding – This source of finance can be uses by organisation which can help
small business to operate and increase the organisational productivity. In this source, company is
focusing on raising the funds that helps to perform all activities and functions (He and et. al.,
2019).
Benefits – This can be defined as simple way of funding that can help to perform and
manage the activities. The Coffee Roasters is small size organisation that have option to run
business and grow activities by using crowd funding. With the help of this, funds can be raise in
less time.
8

Drawbacks – If business do not reach the target then it can be pledge then need to pay
return to investors. This provides a fixed amount for operating business, if there is need high
amounts then it is not good option.
Equity finance – This source of funding is uses by organisation for getting the funds and
growing the business opportunities. The Coffee Roasters can use this source for making money
and performing the activities.
Benefits – This source reduce the burden of money as there is no worry to repay. This is
most suitable source than debt financing which can help to manage the actions. With the help of
many stakeholders keep connected with organisation that helps to increase the brand image.
Drawbacks – There is less control over activities that can reduce the profitability ratio.
In equity many people who invest share their profits that create conflicts in business.
Task 3
A business plan for growing the business by involving financial information and strategic
planning
In context to The Coffee Roasters, a small business is operating by management which
wants to expand their business in other places that can help to maintain the good performance.
For growing business and developing the activities management are formulating business plan
that are as defined:
Executive summary: The Coffee Roasters is UK based company that is providing
different flavour of coffee with different taste that can help to operate the business and increasing
activities. The management are planning to grow and expand their business as it is adopting the
market development strategy that helps to increase the sale and profitability (Miessner, 2020).
Vision and mission- “To satisfy the customers by providing best taste of coffee and
challenging the others”
Strategic objectives:
 Expansion of business by entering in to international market.
 To expand the business and managing the activities in challenging environment.
 Increase sale by 40% within 2021 by offering best quality of coffee.
 Retain the employees who are skilled and talented that can help to manage the activities.
 To operate the business and functions within 2021 that increases activities.
9

STP Analysis – The management of The Coffee Roasters are using the STP analysis that are as
defined:
Segmentation- The management of chosen organisation are selecting the geographical
areas that helps to operate the business at different places which can help to increase
organisational profitability.
Targeting – The management are targeting the people between the age of 10 to 60 years
who wants coffee.
Positioning –For maintaining position this organisation is selecting the wider areas that
will attracts the customers.
Situation analysis:
Strength Weakness
 The Coffee Roasters is larger size
organisation that is operating the
business by offering better taste and
flavour of coffee.
 Uses of new process and experienced
employees.
 Focusing on taste and preference of
customers.
 This is small organisation that has small
customers base.
 Lack of financial resources and
employees.
Opportunities Threats
 Uses of digital marketing and activities
which help customers to order online
and operate the business.
 Having ideas to grow to business and
developing activities.
 Changes in government policies and
regulation
 Low income of business.
Financial project/ Budget – The management of organisation are preparing budgets for their
performance and activities that are as defined:
Activities Amount
Operating activities 5000
Investing activities 7000
Financial activities 8000
10

Total 20000
Evaluating and controlling – The management of chosen organisation are evaluating
and controlling activities by using KPI tool that can help to measure the performance and
increase the profitability. This tool will help to increase organisation productivity by managing
activities which helps to maintain the business performance by delivering best quality of coffee.
The Coffee Roasters is going to expand its business in international market by offering best
quality of coffee and grab the opportunities (AR, 2019).
Task 4
Assess the exit and succession option for small business by explaining the benefits.
A business is required to conduct many activities in relation to a business that can help to
operate the business and increase profitability. Small businesses are those business which are
operating at small areas and performing their activities effectively. The Coffee Roasters is a
small organisation that is making the plans to increase activities and performance by adopting
appropriate strategy and maintaining profitability. A business plan is prepared by managers for
developing and growing the business by adopting the marjet development strategy which can
help to manage functions and performance. Therefore, managers are having exist options in case
of not implementing plans and attaining the objectives.
Exit plan – This refers as activities and options to close their running business in case of
not running properly. In this, organisation is having different options to exit their business by
selecting best one that are as defined:
Liquidation – This is defined as processes that brings a business to an end and distribute
its assets to claimant which can help to exit the business. in other words, it is an event that occurs
at the time of insolvent of company that create a heavy loss for organisation to pay of liabilities.
Advantages Disadvantages
 By using liquidation the debts of
company get write off that manage the
activities.
 In liquidation there is low cost of
organisation because no more
 In small organisation directors and
owners are personally liable to pay of
liabilities by any ways.
 In liquidation the assets of business is
not possible to retain.
11

formalities are required.
 When assets of business are sold out
then remaining amounts can be use to
start a new business and taking the
opportunities.
 Once productive labour and employees
are goes out from the organisation then
it become difficult to retain them.
Selling in open market – This is mostly defined strategy in relation to exit for small
business that can help to sale the business in open market. When a person or business owner
ready to retire and not succeeding in business activities then they put their business in open
market which can help to continue the activities and deliver the performance. The Coffee
Roasters have option to use this aspects in order to exist their business in case of not success and
reducing profitability (Terrill, 2019).
Advantages Disadvantages
 The business should be profitable and
attractive that can help to sell quickly.
 In this, assets of business can be
incorporated at the time of valuing
assets for sale.
 This can help to continue the existing
business by other person that can help
to maintain the brand image.
 To find out the selling is difficult in
open market.
 In selling open market, lower amounts
are valued than expectation.
 This is long process that take time in
existing the business.
Succession plan
IPO – This means initial public offer which can be used by organisation for collecting
funds and entering in to market at first time. This can help to get the business success by inviting
public to buy the shares and get higher return. The Coffee Roaster can use IPO nfor getting
success in establishing their business and managing all activities appropriately.
Advantages Disadvantages
 IPO provide a benefits of gathering
money by issuing shares publicly.
 This can help to grow the business by
 In IPO there is need to additional
regulatory requirements and disclosers.
 This can be market pressure for small
12

attaining publicity and credibility.
 Stock as a means of payment.
business and do not meet with
objectives.
 Higher transaction cost.
Sell to another business – This strategy is uses by small business for making high
profitable by selling to other business. this can be said as acquisition in which a large
organisation has option to acquire the small business for continuing its activities and increasing
brand image by considering a new name. The Coffee Roasters have options to sale its business to
other business which can help to operate the business and maintain the activities (Gunjal, 2019).
Advantages Disadvantages
 This can motivate the small business
as its business will be operated by
larger organisation and will maintain
high profitability.
 This can be challenge for organisation
to sale its business as it create the
competition in market.
 No right amounts are received by
existing business.
The Coffee Roaster is suggested to use IPO to get success in their business where it has
to get registered its organisation from ROC and bring use IPO. This will help to collect money
from public and organise all activities effectively. This will be a succession option for chosen
organisation that would help to collect the fund from public and organise all activities.
CONCLUSION
From the above report it can be concluded that planning is needed at every place which
can help to operate the business and increase organisational productivity. For taking key
consideration PESTLE analysis is required which helps to state how businesses affect the
business. There are many resources of funding such bank loan, crowd funding, equity finance
etc. that are important for business and maintain the high profitability.
13

14