Planning for Growth: Factors, Opportunities, Funding, and Business Plan

This report discusses the factors for analyzing growth, opportunities for business growth, sources of funding, and creating a business plan for growth. It focuses on Tesco, a British multinational retailer, and provides insights into their strategies for growth. The report also highlights the importance of market penetration, product development, market development, and diversification in achieving growth. Additionally, it explores various sources of funding such as banks, financial institutions, and crowdfunding. The report concludes with a detailed business plan for Tesco's FMCG range and outlines their mission, objectives, SWOT analysis, marketing strategies, budget, and risk factors. Subject: Business Management, Course Code: N/A, Course Name: N/A, College/University: N/A

PLANNING FOR GROWTH

Contents
INTRODUCTION...........................................................................................................................3
LO 1.................................................................................................................................................3
P 1 Factors for the analysis of growth.........................................................................................3
P 2 Opportunities of growth for the business..............................................................................5
LO 2.................................................................................................................................................6
P 3 Sources of funding that have potential for business development........................................6
LO 3.................................................................................................................................................8
P 4 Business plan.........................................................................................................................8
LO 4...............................................................................................................................................12
P 5 Exit or succession options for a business that maintains their operations on a smaller level
with the merits and demerits of each factor...............................................................................12
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
Planning for growth is a strategic activity of business that helps the owners to plan and
monitor growth that is organic in their revenue. It allows businesses to allocate their limited
resources in a proper manner that is toward a centered effort so that they can adapt to changes in
the industry driven by digital disruption and can highlight the unique points from other
competitors that are serving in the market. Tesco serves in the sector of supermarkets and it is a
British multinational groceries and general merchandise retailer with headquarters in United
Kingdom. The company has been successful in attaining the position of third-largest retailer in
the world on the basis of gross revenues earned by them and the ninth-largest retailer in the
world measured by revenues. This report includes topics such as Factors for the analysis of
growth. Opportunities of growth for the business. Sources of funding that have potential for
business development. Business plan and Exit or succession options for a business that maintains
their operations on a smaller level with the merits and demerits of each factor (Popov, 2020).
LO 1
P 1 Factors for the analysis of growth
Opportunities of growth are considered as those things which can be external or internal
to the company which are linked to the operations of business through which they can improve
the brand recall in the market. Factors that is external to the business leaves impact which
reflects that whether or not they will reach the point of growth.
Product development-
Development of products that are new can also lead to opportunities for the growth and
the organizations of its business. Product development is concerned with the development of the
products that are already existing in the market as well as the upcoming ones. Tesco works on
providing better products and services to their consumers. Management of the company can
increase the opportunities of growth by increasing the services offered or varieties of products to
their consumers (Rudolf, 2017).
. Management of portfolio-

It is a tool that is done strategically so that company can analyze and assess their current
position in the market in comparison with their competitors. This aspect is also concerned with
the branding of the company in order to enhance the opportunities for achieving growth. The
matrix by Boston Consultancy group with the analysis of growth opportunities for business.
Boston Consultancy Group Matrix-
It helps in guiding the management of the company about the portfolio of the brand.
Portfolio of brand is considered as an effective tool in order to evaluate the presence of the
company in the market. BCG is a tool that is productive so that position of the brand can be
identified and how much potential it has for growth can be assessed (Gallagher and et.al., 2016).
Brand quadrants-
It is a tool that are used to make a investment that is viable for the business and take
better decisions for the business.
Dogs- In order to take decisions for the respect of the business they can be identified when the
products that are offered by the company has low share in the market. The products that are
offered by this category needs improvement in their quality and changes are required in the
strategies of marketing in order to attract consumers (Pan and Li, 2016).
Cash Cows- This aspect is concerned with those products of the company that has high amount
of share in the market but low opportunities for growth. Products that comes under this aspect
turns out to be profitable for Tesco but rate of growth is low. The junk food products that are
offered by Tesco is concerned with this aspect as they have high share of market now but they
have low rate of growth.
Stars- This aspect states that all the products that are offered by the company has high share and
high rate of growth in the market. These products help the company to maintain the level of
profits in the market in order to achieve growth. The affordable FMCG products comes under
this aspect which is the reason company is profitable (Bajracharya and Hastings, 2018)
.

Question mark- all the products of the company that has low share but the rate of growth will
rise with time. The reason behind it is because it is not considered as useful in the minds of target
audience. It is necessary that Tesco enables in order to improve its reach into the market.
P 2 Opportunities of growth for the business
Ansoff growth matrix
This tool of Ansoff Growth Matrix is used so that they can increase the potential of of the
company in the market. this model helps the company to focus on both markets that are existing
and new. The strategies of growth which are involved in this model is
Market Penetration-
This tool helps the company to increase the opportunities of growth in the market that
they are serving in. When the stages of saturation cycle is achieved then the sales of the product
were declining in such a market penetration which is developed effectively so that Tesco can
achieve growth in the market. It is necessary that the company decreases the prices of their
products. They focus more over the aspect of marketing of the product. This aspect of
development leads to aggressive strategies such as acquiring competitors of the company in the
same market so that they can increase the base of their consumers (Anguelovski, Irazábal‐Zurita
and Connolly, 2019).
Product Development-
This aspect helps the company to focus on the launch of new products in the market that
they are dealing in. It is necessary that they analyze the potential of the market and focus on
launching of the product that is new so that they can attract the consumers. For example, in order
to launch a product that is new it is necessary that company undertakes both primary and
secondary research for it as they will help to assess the base of consumers for the product and its
potential in the market. Tesco also has the option to come into a partnership with other
businesses that are operating in the sector so that they can offer different products and implement
the strategy that is better.
Market development-

This helps the companies such as Tesco to focus on tapping new markets so that they can
serve in different and more locations where the potential of consumer is more. It is an effective
way to improve the base of the market of the company which can also support the expansion of
the company. For example, to comply with this aspect other than UK Tesco needs to make
another base of market in different country. This way they will be able to serve mix segments of
consumers by offering them their discounted rates.
Diversification-
This aspect is another aspect of the model that allows the organization so that they can
achieve opportunities for growth in the market. This process helps them to enter into new
markets with the products and services they already offer. This aspect helps the company to offer
their services into new markets that is both domestic and foreign. For instance, management of
the company can enhance the potential of growth by launching the products and services of the
company in the international market. Company can address that consumers that are targeted are
easily reached.
All the aspects of Ansoff Matrix are useful for the company but it is necessary that Tesco
focuses on the strategy of market penetration and product development as they are the ones
which will result and help the company to enhance their potential and serve according to that.
LO 2
P 3 Sources of funding that have potential for business development
Banks-
They are considered as one of the major sources whenever a business needs funding for
the organizations that invest in the growth and development plan of business. This sector is
trusted because they are considered as the safest method to get investment for the business.
Company approaches banks so that they can get their repayment structure in the form of EMI.
Benefits-
 For repayment of loan companies such as Tesco is able to get loan that is personalized.

 Rate of interest is affordable
 The schedule that is made for repayment is effective.
Drawback-
 EMI that is charged in bank loan is not constant and changes on the basis of demand and
supply of other forces in the market.
 For the foreclosure of loan, it is considered as expensive.
Financial Institution-
This aspect is also considered as effective way to get funding for the business for the
purpose of growth and development. Financial institution that are based in UK such as Barclay
invest in corporate sector so that these companies can meet their goals and objectives. Funding
with financial institution is approach that is convenient because they are able to get better funds
in comparison with bank. For instance, management of Tesco can approach companies such as
Barclays so that requirements of funding can be met (Andarge, 2017)
. Benefits-
 Better schemes and better funds are available than bank.
 This is also trusted source for finance.
 Approach for finance towards financing is fast.
Drawbacks-
 Sources of finance that is expensive.
 They require many things at the time of repayment of loan.
Crowd Funding-
This aspect is among the major sources of funding for the companies. it involves
collecting funds by selling the shares of the company to the public. Many people look into this
area for making an investment so that they can earn good returns over the investments and
companies. Companies take the advantage of this aspect so that they can attract the people for
crowd funding and meet the concerns which are related with the financial aspects of the

company. For example, Tesco can release their shares in the market to offer it to general public
so that they can raise money with this aspect and for the growth that needs to be achieved (Pettit
and et.al., 2018).
Benefits-
 Considered as an effective tool so that they can meet the requirement of funding in order
to get good investment.
 It enables the organization to keep a check on the activities that are related to control the
receiving of funds and their repayment.
Drawbacks-
It leads to break in the ownership as the funds that are invested by people allows them to gain a
per cent of ownership.
Justification-
In order to get safe and trusted form of investment it is necessary that banks and financial
institutions are the options that need to be considered by Tesco. Also the rate of interest will vary
upon the economic condition of the market.
LO 3
P 4 Business plan.
Executive Summary-
Tesco is planning to develop their FMCG range which is concerned with the categories of
junk food so that they can improve their quality and increase their sales. The charges of the
products that are going to be offered by the company will be same with their discounted offers as
they are looking to serve more people at an affordable range so that they can form a large no of
customer base. Tesco has worked on the strategies so that they can develop their target audience.
They are also seeking the support of their loyal consumers so that they can improve their services
and achieve growth in the market.

Mission and Vision-
To create value for customers so that they can earn their lifetime loyalty.
Objectives-
 To achieve 20 per cent of the share in market by the end of 2021.
 To maintain 50 per cent of the customers that are already existing and those that are
acquired so that they can get repeated business by them by May 2021.
 To increase the sales of the company by 30 per cent till May 2021.
SWOT Analysis-
Strength-
Products are available in many varieties and discounted rates which attracts a large base of
customers (Jamal, 2018).
Weakness-
 The operating profit of the company is reduced which is affecting their ability to attract
investors.
 Other than this they are making errors in finances which is affecting the management of
debt.
Opportunities-
 To expand the operations and the scale of business.
 To focus on the aspect of development of products and services.
 Management of the company needs to look under the aspect of rate of growth so that it
can be improved.
 Manage the relationship with their customers.
 To build and improve the base of customers.
Threats-
High level of competition which is affecting the revenue of the company.

Marketing strategies-
Management of Tesco will take the help of social media marketing, advertisements
through radio and television so that they can highlight the attributes of the brand in the market.
Other than this they are looking for selling their products online and this is the reason why
internet is going to be an important aspect of the campaign of marketing.
Budget
The estimated budget of the company for their plan of growth and development is more than 1
million Euros.
Sources of Finance-
Taking finance either from bank or financial institution is the final decision of the company.
Risk factors-
The factors of risk which can affect the business of the company such as high level of
competition in the market is reduced at its possible stage so that they can work on expansion and
improve the brand and sales of the company (Boulange and et.al., 2018)
Monitoring and Control-
Strategies such as KPI will be used by the company in order to monitor their sales and
performance so that they can make the effective changes which improves their performance and
helps them meet their expected results.
Target Market: The target market of the company are middle class and upper class people who
easily invest their money to buy a product. As a result, the higher section of UK is the target
market of a company.
Competition: In order to stay ahead in the competition, Tesco offer innovative product and try
to cope up with new and advance technologies which in turn leads a business towards a further
level of success.

Segmentation: To attain the define aim, company segment the entire population on the basis of
demographic information. For that, Tesco chooses male, female and family with high income.
Targeting: For targeting, Tesco uses differentiated target marketing strategy that will assist to
sustain the brand image and attract most of the customers towards it.
Positioning: Its innovative product and low range of price makes the company unique and also
draw attention of many customer towards it.
Operational plan: In order to execute the plan, Tesco uses its hierarchical organization structure
which in turn assist to determine the roles and responsibilities of each team members so entire
team work together. Also, duties are define to each and every member, while manager identify
whether the task is attain or not.
Key milestone: The work need to be completed within next year (May) and for that strategy
needs to be develop that assist to meet the define aim.
Exit plan: For exit planning, selling the business to other will be chosen.
Financial information: The company have a strong financial performance and that is why, it
uses its personal saving and hire new employees with a target of 2 lac euros so that they show
their skills and motivate them as well. The financial plan is as mention:
Particulars Amount (£)
Personal saving 256
Hiring of Employees 20
Technological resources 52
Stationary 12
Miscellaneous expenses 35
Total 375
Critical risk and success factor: As per the plan, Tesco faces risk with regards to employees,
low budget. Moreover, the success factor are its competitive strategy and strong management
which assist the company to meet the define aim.

LO 4
P 5 Exit or succession options for a business that maintains their operations on a smaller level
with the merits and demerits of each factor
Liquidation-
This aspect will allow the company to shut down their business and all the assets
possessed by Tesco needs to be sold so that they can leave the market. Companies such as Tesco
can avail this option when all the possibilities seem dark. It is necessary that the company
maintains their machineries and production facilities so that they can make it ready for the buyer
(Gunder, Madanipour and Watson, 2017).
Advantages-
 This method is fastest if compared to all the other methods.
 It is simple.
Disadvantages-
 Sometimes this method fails to give the returns that are expected by the company and its
management.
 After the machines are liquefied money will be paid to the creditors of the company then
rest of the amount left will be divided between the owners of the company.
 The assets possessed by Tesco in any form such as machinery or other equipment will be
considered as second hand and because of the yearly depreciation they will loose their
value at the time of selling.
Sell it to another business-
Companies such as Tesco has the option to sell their maintained operations to other
business which is ready to acquire the properties of the firm. Many of the businesses choose a
different path that is to implement the strategy of expansion or synergy in order to reduce the
level of competition in the market.
Advantages

In order to acquire other business level of motivation will be high so that they can purchase the
competition in the market which will turn out as a profitable deal for Tesco.
Disadvantages-
 If the buyer of the company focuses on reducing the level of competition than it may lead
to shutting down the operations maintained by the company which will also lead to loss
of many jobs.
 Sometimes it is done for only one purpose and that is to get the contacts of the business.
Valid recommendation:
Among all, the company chosen selling a business so that it will assist others and they
may take an advantage for the same. Moreover, as comparing to other modes of exit plan, this is
most suitable because once the entire ownership has transferred to other, then existing owner do
not have to worry about the company. As a result, it is also evaluated that If the business is
profitable at the time of selling its operations then it will be helpful for the business as they will
be able to find a buyer fast and get a profitable deal for themselves (Okuno, 2018). On the
critically note, it is also analyzed that in order to settle the case with this aspect, it consumes a lot
of time. But, in order to get returns in high form business needs to keep in mind that their assets
can be incorporated. While, in its comparing side, it is not easy to come up with a deal so that
value of the business can be assessed and in order to get the expected return is more difficult.
CONCLUSION
On the basis of above studies it has been analyzed that there are many options and
strategies that needs to be considered by the company in the aspect of planning for growth. This
way they will be able to come up something that is required in the market or develop the
products on the basis of needs and wants of consumers. This report also covers the highlights of
strategies that are required to get investment for achieving growth and if by any chance business
is not able to meet its goals and objectives and survive in the market then the options for leaving
the market after selling the assets are also mentioned. It is necessary that Tesco makes an
effective business plan so that only path that leads to is their success and leave the competition
behind.

REFERENCES
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