Bob & Berts: Growth Opportunities, Funding Sources & Exit Strategies

This report provides a comprehensive growth plan for "Bob & Berts," a UK-based coffee shop chain. It evaluates growth opportunities using Ansoff's Growth Matrix, focusing on market penetration, product development, market development, and diversification, with a recommendation for product development through healthy food and beverage options. The report analyzes potential funding sources, including bank loans, venture capitalists, angel investors, bank overdrafts, and crowdsourcing, assessing their benefits and drawbacks in relation to the organization's requirements. A SWOT analysis identifies strengths, weaknesses, opportunities, and threats, guiding strategic decisions. The report also explores various exit and succession options for small businesses, comparing and contrasting their advantages and disadvantages, and recommends an appropriate exit strategy. The business plan incorporates both financial and strategic information, essential for sustainable growth and attracting investors.

Planning for Growth

TABLE OF CONTENTS
INTRODUCTION ..........................................................................................................................3
MAIN BODY...................................................................................................................................3
P1 Key considerations for analysing growth opportunities ........................................................3
P2 Evaluating opportunities for growth using Ansoff's Growth matrix......................................4
M1 Options for growth using analytical framework....................................................................5
D1 Specific options and pathways for growth.............................................................................6
P3 Potential sources of funding along with benefits and drawbacks of each source...................7
M2 Evaluation of potential source of funding.............................................................................8
D2 Evaluation of potential sources in accordance to organization requirements........................8
LO3 Business plan for growth which includes financial and strategic informations..................9
P5 Exit and succession options for small businesses.................................................................11
M4 Comparing and contrasting different exit options...............................................................13
D4 Recommendation for the appropriate exit option................................................................14
CONCLUSION..............................................................................................................................14
REFERENCES..............................................................................................................................15

INTRODUCTION
In the emerging market growth planning is very essential for all types of organization for
sustainable growth and development of business. Growth planning is a strategy which enables
owners of business to plan growth in their revenue and profit. For expansion of business it is
very essential for organization to develop a growth plan which will enable them to attract
investors for their new project. Growth plan will also help organization to analyse and evaluate
market, customers and funding requirements. The project is about evaluation of opportunities for
business growth and development of business case for small scale business. The organization
which is chosen for the project is “Bob & Berts” which operates a chain of coffee shops in UK.
Company serves coffee, hot and cold drinks, burgers and other food items. Report contains
evaluation of growth opportunities for business using Ansoff's growth matrix along with
different sources for funding. Project includes appropriate source of funding for Bob & Berts for
development of new product. Development of business plan for growth which includes financial
and strategic informations. The project also highlights exit or succession options for small scale
business along with benefits and drawbacks of each option.
MAIN BODY
P1 Key considerations for analysing growth opportunities
There are many considerations for analysing growth opportunities. The organization
which maintains sustainable competitive advantages can remain competitive in market and
increase its market shares. The competitive advantage refers to situation where company is
different from its competitors which can through diverse products or services or price of
products. Bob & Berts is small scale chain of coffee shops and it is essential for company to
maintain competitive advantages by providing innovative products to its customers. The other
key considerations are growth option i.e. market or product development or diversification.
Collaboration can also be used by companies as growth opportunities. The key consideration
used by Bob & Berts for analysis of growth opportunities is competitive advantages through
innovative products. For gaining competitive advantage, company can make use of Porter's
generic strategy model and link it with opportunities for growth in macro environment.
Cost leadership
The cost leadership strategy focus on becoming cost leader in market by producing
products at lower cost than from competitors (Islami, Mustafa and Topuzovska Latkovikj, 2020).

This give advantage to organization to set lower price for products and increase profits.
Organization can increase its market shares by charging lower price and earn reasonable profit
by selling large volume of products.
Differentiation
Differentiation strategy refers to producing products or rendering of services which is
different from competitors and can attract more customers. To become successful in
differentiation strategy organization is required to conduct good research of market and
customers (Ali and Anwar, 2021). The organization must have ability to provide high quality
products and services and conduct effective sales and marketing.
Cost focus
Organization who implement this strategy targets niche market and try to become cost
leader in that market. The products and services provided in niche market are of low price as
organization focuses on low cost production.
Differentiation focus
The organization targets niche market with differential products and services which can
attract more customers. Entities who implement differentiation focus strategy must ensure that
products and services rendered by them are unique and with high quality.
Bob & Berts can implement differentiation strategy to achieve competitive advantage of
unique products. The analysis and evaluation of macro environment using PESTLE has revealed
that customers are becoming health conscious and there may be increase in demand for healthy
food and beverages (AKMAN, 2020). Company can use this opportunity and provide food
products with low calorie and sugar free. Company can also provide healthy turmeric coffee for
its health conscious customers.
P2 Evaluating opportunities for growth using Ansoff's Growth matrix
Ansoff's growth matrix also known as product- market matrix is used by organizations to
identify opportunities for growth in market through development of products and services or
expansion in new markets. The matrix is divided into four segments in accordance to market and
products. Bob & Berts can use this growth matrix for strategic planning and to analyse prospects
for growth.
Market penetration

Market penetration is the strategy used by organizations to increase sales of its existing
products in market in which they are familiar with (Zanjani and et.al., 2020). This can be
achieved by organization by using innovative promotion and marketing schemes or by
streamlining distribution processes. Organization can decrease the price of its products or
services to attract more customers, or they can also acquire competitors in market to decrease
competition in market. It is less risky strategy and safest of four options.
Market development
Organization which implements this strategy try to expand its business by entering into
new market with its existing products. Entities require to have good research of market in which
it is planning to enter and analyse demand for its products in that market. The approach includes
targeting different customer segments and entering into new market or country. It is less risky as
it does not involve investment in research and development for innovation of new products or
services.
Product development
The companies deal in existing market with new and unique products to attract customers
and to increase its market shares. This strategy includes investment in research and development
for production of new and unique products and services in accordance to preference and taste of
targeted customers. It is risky approach as it involves huge investment to develop new product.
Diversification
Diversification is mixture of both market and product development. Organization who
implement this strategy enter into new market with new products and services (Schawel and
Billing, 2018). It involves the highest risk with higher rewards by achieving new opportunities of
entering new market and increasing revenue through increase in market shares and expansion.
The diversification is of two types related diversification and unrelated diversification.
Bob & Berts can implement product development strategy for growth and increase
revenue. Company can provide new and unique products to its targeted health conscious
customers. Healthy low calorie and sugar free food products can attract more health conscious
customers as perspective of customers are changing, and they are moving towards healthy diets.
M1 Options for growth using analytical framework
SWOT analysis can be used to evaluate the options for growth of Bob & Berts. SWOT
analysis is used to evaluate strengths, weaknesses, opportunities and threats of organization

(Benzaghta and et.al., 2021). Using this analytical framework, company would be able to know
its strengths and opportunities that market is giving and take advantage of those opportunities to
achieve competitive advantages and success.
Strengths
 Strong brand with chain of coffee shops
 Efficient and capable employees
 Strong and loyal customer base
 High quality products and services
Weaknesses
 Cost disadvantage as there is low profit margin
 Limited market share
 Difficulty in generating publicity
Opportunities
 Change in perspective of consumers, moving towards healthy living
 Attracting new customers through innovative products
 Improving overall customers experience
Threats
 Consumers becoming price sensitive
 Entry of competitors in market
Bob & Berts can target health conscious customers by developing new healthy turmeric
coffee which can increase its market shares. Innovative product will enable it to compete in
market and remain competitive.
D1 Specific options and pathways for growth
There are different strategies through which Bob & Berts can achieve growth and
increase market shares. Market penetration can cause prices to get lowered due to competition
and to attract more customers. Market development strategy requires entering new market and
this is risky if company do not have idea of new market and this strategy involves huge
investment. To mitigate the risk involved in market development, company requires good
research and analysis of new market and customers (de Andrés, de la Fuente and Velasco, 2021).
Product development and diversification involves risk of finance, implementation and effective
decision-making risk. Company is required to analysis its customers and provide innovative

products in accordance to their needs and preferences. It is essential for company to develop a
growth strategy and evaluate all aspects which may impact the growth and development of
company.
P3 Potential sources of funding along with benefits and drawbacks of each source
Finance is very essential for business to mitigate day to day expenses and to invest in
growth and expansion of business. Organization is required to consider different sources from
which they can raise funds for mitigating working capital requirements and invest in new
projects (Dow and Shannon, 2019). The potential sources of funding available with Bob & Berts
which can be utilized for investing in new projects are:
Bank loans
Company can raised funds by taking borrowings from banks and financial institutions for
long period by paying interest on such borrowings.
Advantages Disadvantages
 Easy to access funds
 Repayment can be on instalment basis
 Loan can be taken for long term
 Financial risk involved as payment of
fixed interest
 Strict legal formalities
Venture capitalist and angel investors
Angel investors are people who are familiar with investment opportunities, and they can
be family members or friends (Chapin, 2019). Venture capitalists are group, firm or company
who collect investment from public and invest those amount in another companies or projects.
Advantages Disadvantages
 Potential to raise huge amount
 Can receive expert business advice and
help
 Easy and quick access of money
 Involvement of investors in every
decision-making process
 High rate of interest
Bank overdrafts

Bank overdrafts are short term credit provided by banks to its customers who hold current
account in banks (Halt and et.al., 2016). This source can enable company to mitigate working
capital requirements of business.
Advantages Disadvantages
 This enables company to raise money
in emergency
 Interest is payable on overdrawn
amount
 Impact on credit scoring of company
 Short term source and bank can ask for
repayment anytime
Crowdsourcing
Funds are raised from numerous of small investors but the total sum collected may be
huge. This is obtained through social media or through online means.
Advantages Disadvantages
 Simple, fast and cheap source of
funding
 Good attention from social media as
funds are raised via social media
platform
 High risk and uncertainty
 Strict legal formalities
M2 Evaluation of potential source of funding
There are different sources of funding that are available with Bob & Berts which can be
invested in growth planning strategy and new product development. Company can raise medium
and long term funds through banks and crowdsourcing. Banks can provide loans at low interest
rates than from other sources and there will be less involvement of banks in decision-making
process (MASON and BOTELHO, 2018). Crowdfunding is also potential source of funding as it
is cheap and fast source of funding and it will indirectly enable company to promote its business
through online means and social media. The short term finance which can be raised through bank
overdrafts. Amounts raised through bank overdrafts can be used to mitigate day to day expenses
of company and interest is only paid on overdrawn amount.

D2 Evaluation of potential sources in accordance to organization requirements
Bob & Berts is planning for growth through implementation of product development and
diversification strategy. Organization is planning to develop healthy coffee and low calorie sugar
free food items which can attract health conscious customers and enable company to achieve
competitive advantages. To implement this growth strategy company requires funds which can
be raised through different sources of funding. The potential source of funding which is available
with company are bank loans and crowdfunding as long term source and overdraft as short term
source (Utami and Widiyanti, 2020). Bank loans and crowdfunding are easy and quick source of
funding and which involves low rate of interest. This will enable company to with low burden as
repayment of bank loan are on instalment basis. Company can raise short term loans through
bank overdrafts as interest on this is paid only on overdrawn amounts. This source of funding is
advantages for mitigating day to day requirements and on emergency basis.
LO3 Business plan for growth which includes financial and strategic informations
Vision
The vision of Bob & Berts is to become the desired place for coffee and other bakery
items to enjoy with friends and family.
Mission
The mission statement of company is to provide the highest customer satisfaction through
high quality and innovative products and services.
Objectives
 To increase customer base through loyal customers
 To provide customers with high and innovative products and services
 To increase profitability and market shares
Stakeholders
The internal and external stakeholders of Bob & Berts are its employees, customers,
management team, suppliers, investors and banks, environment and Government. Employees- Organization has efficient and talented employees who have enabled
company to provide excellent high quality products and services and to build strong
customer relationship.

 Customers- Company is focused to provide high customer satisfaction by providing high
quality coffee and bakery items in accordance to taste and preference of its customers
(Abdullah, 2020). Company is planning to target health conscious customers by
providing turmeric coffee and low calorie sugar free food items.
 Suppliers- The suppliers company consists of wholesale supplier firms and coffee
farmers who provide good quality products at low cost. This enabled company to provide
high quality food and beverages to its customers.
Operational strategies
Bob & Berts is planning to develop growth plan after good analysis and evaluation of
external environment using PESTLE analysis tool and internal environment using SWOT
analysis. The company has evaluated growth opportunities using Porter's generic growth strategy
and Ansoff's growth matrix. After analysis and evaluation of all aspects of growth and
expansion, company is planning to implement differentiation strategy by providing customers
with new and unique products which will ensure customer satisfaction and higher profit margin.
Company is planning to target health conscious customers by providing healthy coffee and food
items (Götz, 2020). Company is also planning to expand its business in new market. The
efficient workforce and management team will enable company to achieve success in this growth
and expansion plan.
Technology plan
Company is planning to use the opportunity of online and social media platform to
expand and promote its business. Organization is trying to expand its business by accepting
orders online and providing home delivery services of food and beverages. Company is also
going to install new and customized coffee making machine for making turmeric coffee.
Resource plan
Resources for developing business plan are good research of market and customers along
with their needs and feedback from customers about new products.
Risk factors
The risk that are involved in development of new product are financial risk, market risk
and organizational risk (Cerdeira, 2018). The success of project will be achieved if product is
launched on time and customers are satisfied with new product.
Marketing plan

Marketing plan refers to advertisement and promotion strategy implemented by
organisation to attract customers. Marketing plan and strategy involves 4Ps of marketing mix i.e.
product, price, place and promotion. The product that is going to be developed by Bob & Berts
are turmeric coffee along with this healthy low calorie and sugar free cakes and muffins. Entity
is going to use penetration pricing strategy for its products. Coffee and other bakery items will
be made available at coffee shops and there will be home delivery services too (Marques, 2020).
Company is going to promote its new products through online and social media platform and
also going to develop company website where there will be information regarding every product
along with its price. Customers will be enabled to place order using company website.
Time frame
Activities 1 2 3 4 5 6 7 8 9 10 11 12
Vision &
mission
Research
Operational
strategy
Technology
planning
Resource
planning
Marketing
planning
Financial information
Budget
Particular Amount (£)
Research and development expenses 2500
Product development expenses 650