Planning for Growth: Strategies and Funding Options for SMEs

Planning For Growth

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Key considerations for evaluating growth opportunities and justify these considerations
within an organisation............................................................................................................1
P2 Opportunities for growth applying Ansoff’s growth vector matrix..................................3
M1 Options for growth using analytical frameworks to explain competitive advantage.......3
D1 Specific options and pathways for growth, considering the risks of each option and how
they can be mitigated..............................................................................................................5
TASK 2............................................................................................................................................6
P3 Potential sources of funding available to businesses and benefits and drawbacks of each
source......................................................................................................................................6
M2 Potential sources of funding and justification for the adoption of an appropriate source of
funding for a given organisation.............................................................................................9
D2 Potential sources of funding with justified argument for the adoption of a particular source
or combination of sources, based on organisational needs.....................................................9
Task3..............................................................................................................................................11
P4 Business plan for growth including financial information and strategic objectives for
scaling up a business............................................................................................................11
M3 Appropriate and detailed business plan for growth and securing investment, setting out
strategic objectives, strategies and appropriate frameworks for achieving objectives.........13
D3 Coherent and in-depth business plan that demonstrates knowledge and understanding of
how to formulate, apply and achieve business objectives successfully...............................14
TASK4...........................................................................................................................................16
P5 Exit or succession options for a small business explaining the benefits and drawbacks of
each option............................................................................................................................16
M4 Evaluate exit or succession options for a small business comparing and contrasting the
options and making valid recommendations........................................................................18
CONCLUSION..............................................................................................................................18
REFERENCES..............................................................................................................................20

INTRODUCTION
Planning for growth is very much necessary in business because it helps an organisation to
expand and grow its market, gain competitiveness, diversify products and services etc. The
following assessment will consist of various methods for achieving competitiveness of these
small medium enterprises for which Porter's Genetic Theory will be used to explain the strategies
of organisations to achieve competitiveness in the market. Along with this, Ansoff's Vector
growth Matrix will be used for planning for the growth of the organisation. The report will
present a strategy for organisational growth with the help of Igor Ansoff's Matrix which focuses
on identifying the ways by which the products and services of the organisation can help to
achieve greater market coverage (Morison, 2020). Furthermore, it demonstrates various ways of
raising finance as well as their negative and positive aspects. It will also focus on demonstrating
a business plan that will include the goals and objectives of the organisation to be achieved in
future. The business planning for the Bridge House Hotel will be included in the report along
with business goals, mission and vision. The Bridge House Hotel is a three star hotel that was
established in the 1760s and is headquartered at Bridport, UK. It will also reduce a SWOT
analysis, financial plan and marketing mix for the business. In the end, it will include an exit plan
and succession strategy for the business that plays a very important role in business.
TASK 1
P1 Key considerations for evaluating growth opportunities and justify these considerations
within an organisation
Competitive advantage
For analysing the main aspects of growth opportunities of an organisation it is necessary
to understand the profitability of an SME organisation so that its competitiveness can be
evaluated (Linnik and et. al., 2020). There are various strategies that can help small medium
enterprises like Bridge House Hotel to achieve greater competitiveness that are as follows.
 By implementing the invention and innovation of new products and services in the
market, companies can become more competitive.
 Organisation can improve effectiveness of their processes and operations for producing
optimum results within their business.
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 Use of the latest technology that can help to bring greater customer experience and
increase competitiveness in the market.
Porter’s Generic Strategy
These methods can be connected to various strategies of Porter's Generic.
 Cost leadership: The Bridge House Hotel can produce goods and services at cheaper cost
so that competitiveness can be achieved. If the organisation focuses on economies of
scale, effective raw material acquisition, supply chain, and better use of technology then
it can produce cheaper cost products (Haider and Tehseen, 2022). But developing a cost
leadership company can improve its performance in the industry and will lead in a cost
effective segment of the industry.
 Differentiation is another strategy that can endure Bridge House Hotel to be exclusive
with its products which lead to its exclusiveness among the buyers that will bring greater
competitiveness of the organisation in the industry. The company can raise its target
segment and can fulfil the desires of the organisation (Young and et. al., 2020).
 Focus strategy is based on choice of the organisation to move towards niche market
segments so that competition is low. For this Bridge House Hotel can move towards a
specific target group within the market so that they stay away from the competition. This
strategy consists of two segments that are cost focus where the company can look after
lowering down the cost in the market and differentiation focus where customers look for
different kinds of products where the company focuses on different markets.
After considering the opportunities for growth of the organisation it can be stated that Bridge
House Hotel can adopt a differentiation focus strategy for gaining competitiveness in the market
by producing diversified and differentiated products and services. The hotel is small and it could
focus on a particular market area to achieve higher market coverage. It must be considered that
cost leadership strategy is very risky for the organisation because this strategy may hinder the
strategic decisions of the organisation, but this strategy can be useful in targeting niche markets
by offering low rates for services.
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P2 Opportunities for growth applying Ansoff’s growth vector matrix
Igor Ansoff introduced a growth matrix so that an organisation can achieve greater
competitive strength by using various growth strategies. This matrix mainly synchronises certain
methods by which an organisation could achieve growth in the market by using existing or new
products in the markets (Olesen, 2022).
 Market penetration is focused towards improving the range of existing products to cover
a greater market area so that organisations can achieve opportunities for growth in your
market. For instance, fast moving food counters within the UK have achieved huge
business profits by using market penetration.
 Market development is helpful for SME organisations because it can achieve a greater
level of growth by focusing on the existing market area. The SMEs throughout the world
have adopted this strategy for achieving competitiveness in their existing market area. It
is also discovered in the SME ITC companies that they use this strategy to achieve
competitiveness in the existing market.
 Product development is a strategy where an organisation tries to develop a complete new
product and focuses on placing that product in the existing market so that it can achieve
greater competitive advantage (Rienzo and Chen, 2018).
 Differentiation is a completely dynamic strategy that was introduced by Ansoff because
in this method the organisation tries to achieve competitiveness in the New Market by
introducing new products or services.
M1 Options for growth using analytical frameworks to explain competitive advantage
To analyse the major intrinsic and extrinsic factors that affect the competitiveness within
Bridge House Hotel certain frameworks like SWOT, PEST and Porter’s five Forces analysis can
be used.
SWOT Analysis
Strengths Weaknesses
 Higher competitiveness due to positive
culture of the business
 Advancement of technology helps to
provide better customer experience and
 Increasing turnover of the employees
 Chances of increased workload due to
improper management within the
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