Planning for Growth: Key Considerations, Ansoff Matrix, Funding Sources, and Business Plan

This report discusses planning for growth for Prufrock coffee café, including key considerations for evaluating growth opportunities, Ansoff growth matrix, potential funding sources, and a business plan. It also explores strategies for growth and funding options.

PLANNING FOR GROWTH

TABLE OF CONTENT
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
LO2..................................................................................................................................................3
P3 Potential funding sources.......................................................................................................3
LO 3.................................................................................................................................................5
P 4 Business plan.........................................................................................................................5
LO4..................................................................................................................................................9
P5 Exit strategies for SMEs.........................................................................................................9
CONCLUSION..............................................................................................................................11

INTRODUCTION
Planning for growth is very important task to a business or company in the market place.
Without preparing a specific plan, no business can be achieved higher growth in the market
place. This is the main reason that, upper management within most businesses has fully focused
on making a very productive business plan, in which after considering that business plan, a
person can simply grow its business in the selected marker place (Picard, 2016). However, this is
very prime responsibly for upper management of a business that, it should include some very
effective business strategies in its plan of business, because strategies are essential in order to
deal with existing competitors of market. This report discusses planning for growth topic for
Prufrock coffee café, this is a small coffee café business situated in London, England, United
Kingdom. There are key considerations for evaluating growth opportunities to business also has
been discussed in this report. Ansoff matrix, potential funding sources and a very effective
business plan also has been included in this report for the overall growth of Prufrock coffee.
Lastly, some productive exits or succession options also has been discussed below.
MAIN BODY
LO1
P1. Key consideration for evaluating growth opportunity
Growth is denoted as enhancing the overall potential outcomes of the organisation. This
is about to boost the overall growth and profitability of the organisation. Following are the
factors that needed to analyse while evaluating the growth opportunities.
McKinsey 7 S Model
McKinsey 7 S Model is an effective tool that can be used to identify various growth
opportunities associated with organisation. Management at Prufrock Coffee must analysis the
factors associated with this model in order to address all potential growth opportunities
associated with the organisation (Pieroni, McAloone and Pigosso, 2019). This model evaluate
factors like structure, systems, style, staff, skills and strategy. On the basis of all this factors

company can identify the best possible way to approach growth against the business operations
undertaken by company.
Structure: Structure of the Prufrock Coffee is more like flat. In the small organisation this is the
best suitable structure that follows. This structure allows the organisation to manage all its
operations as the work fore in these organisations is minimum so coordination between
employees play an important role to achieve the best level of work efficiencies. This structure
supports the organisation in achieving the satisfactory services of the organisation.
Systems: System is denoted as the services of the Prufrock Coffee. They always try to cater the
best level of services which can meet the best level of customer satisfaction against the
operations.
Styles: Style is denoted as the approaches of organisation to achieve the best level of work
efficiencies. Company follow the style which allow the organisation to achieve the best level of
growth in the market (Cooper, Cheung and Gartland, 2020). It focuses over innovation and
customer satisfaction that denote the operational styles company undertake.
Staff: Prufrock Coffee try to motivate and give training at professional level to its work force.
This support the organisation in achieving the best level of operational efficiencies.
Skills: Management at the Prufrock Coffee always try to give emphasis over improving the skills
and capabilities of the employees and human resources associated with the organisation. The
skill development program and campaigns run by organisation give emphasis over developing
and improving the skills of employees and human resources associated with the organisation.
Skills are among the key tool which supports the employees of company to deliver the best level
of operations against the functional activities associated with the organisation.
Strategy: In order to achieve the best level of growth opportunities company form different
strategies such as social media marketing, digital marketing, innovation and various other
strategies. All these various strategic tool company has used would support the organisation in
achieving the best level of work efficiencies.
The above mentioned aspects and factors denote the potential of organisation in order to
achieve the best level of growth opportunities in market.

Business life cycle
Business life cycle denote the stage of the organisation that can support the company in
forming the best level of strategies for entertaining growth in business.
Start up: This is the initial time of the business. It is the initial stage where company has just
started the business. Its been many years since the Prufrock Coffee have started its business
operations (McLeod, 2020).
Growth: Company is under the growth stage of business life cycle. This is a good indicator for
the Prufrock Coffee in order to channelize various business operations.
Maturity: This is the stage where company generate the profitability that is sufficient to meet
the expenses of company. In this stage aggressive and immediate policies and strategies needed
to implement by organisation.
Renewable: This is the post maturity stage. Company started incurring losses against the
business operations.
P2. Ansoff growth matrix
Ansoff growth matrix model indicate different strategic options and choices company
carry in order to entertain growth in the business. This involve different strategic choices such as
market penetration, product development, market development and diversification.
Market Penetration: In this strategic choice company try to increase its sale in the existing
marketing. In this discount strategies are channelizes by organisation. At low prices all products
are offered to customers by the organisation (Pivorienė, 2017). This is an important strategic tool
that can be channelizes against all such products that contain lesser demand in the same market
as compare to the earlier response monitored against the sale of such respective products.
Product development: In this strategic choice organisation tries to launch new product in the
existing market. This is a key strategic option which allows the organisation to improve its sales
and growth in the existing dealing market. Product development allows the company to improve
the growth of the organisation.

Market development: Market development is another key strategic choice in which business is
expanded in the new market. In this strategic choice existing products are launched in the new
market. This allows the organisation to boost its growth rate in the market (Atewamba and
Boimah, 2017). This allow to cater the new potential customers in the market against entering
best possible growth opportunities in the market.
Diversification: In this strategic choice new products are launch in the new market. This is the
most aggressive strategic option associated with the organisation against the growth
opportunities organisation is looking for. Diversification makes the organisation more strong and
aggressive against the operations entertained by the organisation. It improves the overall scale of
the business. This strategic choice also support organisation in boosting sale over all existing
products offered in market.
Prufrock Coffee can approach to the market penetration strategy against the growth
opportunities it is seeking. This would support the company in enhancing and boosting the
growth rate in the market.
LO2
P3 Potential funding sources
A business cannon run its different operations and activities within market place without
having proper source of funding, in which this is upper management of Prufrock coffee also need
to take steps towards accessing different potential sources of funding (da Silva Sales, 2017).
Currently there are many effective sources of funding simply available in the market place, in
which some major and potential sources of funding have been mentioned below. The
management at Prufrock need to choose an appropriate funding source according to its own
business comfortability.
Banks
This is one of the most finest finding sources to all types of businesses, like; small scale,
medium-sized, and large-sized etc. In this situation, upper management of Prufrock coffee café
simply adopt this source of funding. Basically, currently many banks exist in market place which

provides fund to all types of businesses, and also provides for both terms, long or short, in which
coffee business can simply access fund from banks. Firstly, the business has to research about
which bank is providing fund on very low interest rate, because this is very necessary reduce the
unnecessary efforts of business. Currently many businesses and companies are taking lots of
advantages from this source. Banks provides fund for long term as well as short term to any type
of businesses, so this is the benefit of existing funding source. On the other side, when any
business raises fund from banks, then they have to complete a very complicated paper work
formality, so it is the drawback of this source.
Investors
Many people within the market place has considered investors also as potential funding
sources, in which upper management of Prufrock coffee can adopt and use this source also for
raising fund in its workplace (Bean, 2016). Basically, investors always like to invest in that types
of businesses which can really provide them better outcomes, so existing management of
business need to share its vision and aim of higher growth with different investors for convince
them to invest in the Prufrock coffee venture. However, while raising fund from investors, there
are business will no need to complete complicated paper work formality as bank loans, so it is a
benefit of this source. On the other side, most investors demand for sharing in the business, and
after giving shares to investors, the real owner of business can be lost its whole ownership on the
business, in which this is the drawback of investor source of funding.
Personal savings
The management of business can use its savings also as potential funding sources, and
this is the safest way to a business for accessing the fund in market place. Most the companies
and businesses always have savings, in which there is Prufrock coffee also currently has huge
savings. In this situation, upper management of business need to adopt this way of funding, and
need to start using it. Basically, when existing small coffee business use savings as funding
source, then it no need to pay interest, so this is benefit of personal saving source. On the other
side, this source is not efficient to a business for fulling the need to large fund, because Prufrock
has limited fund in savings, so this is drawback of personal savings funding source.
Justification

Currently personal saving is the most appropriate and potential source funding, because if
Prufrock coffee raise fund from banks and other financial institutions, then it will need to pay a
large amount in interest, and currently this small business is not able to pay high amount in
interest (Hashem and Brigden, 2019). That’s why upper management of existing business have
to steps towards raising fund from its personal savings, because savings are its own fund.
LO 3
P 4 Business plan
Executive Summary
Prufrock café is going to make the right decisions and strategic measures for themselves
so that the company will be able to operate effectively. The company will have to make sure that
they are reducing the risks therefore the following report is going to consist of the business plan
of Prufrock café so that the company can analyse and then make the right decisions accordingly.
Objectives
 By the end of 2023 there is going to an increase in the profit margins by 25%.
 The sales will increase by 45% by the end of 2026.
 There is going to be a market share increase by 55% by the end of 2024.
 It is going to make the organization have a better strategy and objectives for the
organization by the end of 2025.
Marketing mix
 People
There are has to be good transparency with the employees, customers, stakeholders, etc so
that there can be higher functioning and the company is going to have good status in the market
as well which is good for the strong branding of Prufrock Café (Kazmi and Shin, 2017).
 Price

Prufrock café is putting in competitive pricing strategy so that the company is going to have
higher stability and sales. Unique factors are present in the products and services of the market
and make the brand image.
 Place
The company has placed themselves in the centre of London which is a great advantage for
the café since they would be able to get in more customers.
 Promotions
There are a lot of discounts and offers which are being provided to the customers and also
loyalty cards for the daily customers which is going to be good for the sales of the café.
 Product
Prufrock café is going to maintain the quality and standards of the products and services so
that the company can have a higher reputation and stable performance in the market (Wann-
Ming, 2019).
 Process
Satisfaction of the customers and the employees is very important in Prufrock café so that
there is going to be a competitive advantage in the market for a long run of business.
 Physical Evidence
The company is having excellent interiors not just for the customers to get attracted but for
the employees working environment as well so that there is going to be higher productivity.
Marketing strategy
 Segmentation
There are a lot of strategic changes which are coming in the organization so that there is
informational technology which can help the company be able to achieve their target.
 Demographic Segmentation- Student, working age, etc are going to be focused upon so
that there is going to be higher loyal customers.
 Geographical Segmentation- Culture, population density, values, etc so that the product
and services will be reaching the customers faster.

 Behavioural Segmentation- The aim of Prufrock café is to satisfy and make the customers
loyal in the organization so that there is going to be well maintained operations taking
place (Loures, 2019).
 Targeting
The company is going to be targeting the travelers and students in the locations which is
going to make the sales and operations of the organization increase.
 Positioning
The company has already made a place for themselves online which is going to make the
company be able to communicate and take feedbacks from the customers effectively which is a
very good factor.
PEST
 Political Factors
The decision making and stability is going to be present in the organization since there is
stability in the political power of the company which is a great factor. The policies and laws have
not been changed therefore the existing laws for the employees and customers well have to be
focused upon by the café for brand value and image.
 Economic Factors
The company has been able to have a strong base for themselves since the unemployment
rates and GDP in the country is improving which is why the company will be able to place their
products however they want to (Flannery, Clarke and McAteer, 2019).
 Social Factors
Customers lifestyle has changed therefore it is important for the organization to follow the
trends and needs of the customers from time to time and also respect their culture and value.
 Technological Factors
There are a lot of technological changes which are present in the company which is going to
make the efficiency and operations more effective which is a great factor for the company to
have in the market.
SWOT

 Strengths
Having the right skills is the strength of the café and that is going to help the café be able to
have higher competitive advantage in the market and brand value. There are a lot of right
decisions as well which would be present for effective working.
 Weaknesses
There are not many experienced employees in the organization which is going to impact on
achievement of the objectives and goals and also make the standards of the customers be
matched from the café (Milano, Novelli and Cheer, 2019).
 Opportunities
Products and services of Prufrock café is being focused upon and improved with time so that
the demands and expectations of the customers is matched so that there is going to be higher
operations for higher future decisions.
 Threats
The competition in this industry is very high which is why the company will not be able to
operate effectively in the market which is a great losing for the organizations long run. The sense
of direction is also going to get affected which is not a good factor for a long run.
Finance
Basis Amount
Labour €2,000
Raw material €3,000
Technology €4,500
Components €1,700
Total €11,200
Sourcing Finance
Prufrock café is going to opt for capital working funding so that there is going to be
higher investment amount so that there is going to be functioning. There is good stability which
economic factor so that there is going to be longer performance.
Monitoring and controlling

Managers and leaders of Prufrock café will have to control and monitor the employees by
using the right measures and techniques which are 360 degree and bench marking so that there is
going to be effective working (Rijal and et.al., 2018). Satisfaction is very important of customers
and employees which is important.
LO4
P5 Exit strategies for SMEs
It is important for firm to have a proper succession strategy so that business can easily be
handover to someone with deserving profile. Every company is setup by devotion of owner and
long term effective so emotional attached remain to it. Before selling an organisation firm owner
look into option that are available for him and also depends on his needs for example someone
wants to continue legacy while other focuses on earning money.
Liquidation
In this founder of organisation emphasizes on selling of assets to people and increase his
bank financial by it (Lea, 2020). There are number of organisation which run same business and
hence can easily ready for purchasing firm’s property and other related things. However, after
selling assets amount has to be pay to shareholders, investors etc.
Pros
Founder tension decrease as new owner of property will be responsible for running the
business. It is also one of the quickest methods for shutting down organisation.
Cons
Organisation is founded by long devotion of owner and selling by this method will affect
on legacy. Finance earns by liquidation will not so large that can help in opening any other
business.
Continuing the Legacy in the Family

It is one of the best ways to free from business and Handover Company to someone in
family which can easily run firm. Legacy of organisation will not break and founder can mentor
new owner. Successor will make new changes but it doesn’t affect primary structure of firm.
However, owner inclusion might be not liked by new founder which can effect on business of
firm.
Pros
Founder has option in selecting new owner and cal also train him for running the
business. Mentoring business be ex CEO with new ideas from young generation of family highly
impact on growth of organisation.
Cons
New person might not have business acumen which can effect on company and hence it
can suffer various types of competitive challenges in market. Owner still feel stress because
mentoring new founder and hence will get less time for himself.
Merge or Become Acquired by another Business
Organisation is merged by another company which is running same type of business or
investing in this (Hsu and et.al., 2016). It decrease responsibility of owner as well as negotiation
chances increase in this case which can help in gaining more money for by selling his property.
However, legacy of firm might not be understood by new owner and hence personal emotion of
ex-owner might be hurt.
Pros
It easily release owner from his roles and responsibility and can focus for running new
business. Negotiation help in increase finance which can be invested in new firm or can be use in
future.
Cons

It is one of the time-consuming process as owner has to talk to many company for
merging and business cannot easily be handover because it has to pass from various
documentation process.
Justification
Prufrock coffee business is small in size and hence best option will be allow new
generation in family to run business. Mentoring by ex-founder will continues follow legacy of
firm hence emotional attachment cannot be hurt. Combination of new and old generation ideas
will take business to next level and increase profit share as well as create impactful market image
of organisation.
CONCLUSION
On the basis of above findings, it can be concluded that each business or organisation
cannot survive in the current highly competitive market place without having a specific business
plan. Basically, planning for growth always enables to a business for effectively growing in the
market place. Currently the Prufrock coffee café business has great growth opportunities in
market place. For example; people like to drink different flavours of coffee in their daily lives, so
after producing an exclusive range of coffee flavours, it can simply attract many new customers
towards its brand. On the other side, currently many potential sources of funding simply
available to this business in market. A very productive business has been added to Prufrock
above for gaining excellent profit margins and huge competitive advantage in the market place.

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