Business Expansion Plan: Marvin and Smith Coffee Shop

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Business expansion

Table of Contents
Introduction...................................................................................................................... 3
Selection of the country which can be suitable for Marvin and Smith's coffee shop.....4
Marketing mix in relation to the coffee shop expansion plan in Finland........................6
Key factors and challenges of business expansion......................................................8
Concluding summary about the overall viability of overseas expansion.....................10
Conclusion..................................................................................................................... 11
References.....................................................................................................................12

Introduction
Business expansion can be referred to as the opportunity for the company to get
success and growth. The approach of expansion could be positive or negative for any of
the organization. Despite the fact that making the expansion this is most necessary to
determine the estimated idea of the approach on the company. Hank Marvin and Patty
Smith worked together from past some year to make coffee shop and they had started
their business on low level subsequently establishes their own coffee shop in
Wandsworth in South London by January 2017. They had expended their business in
London as they opened other two coffee shops and used initial information system that
helped them to facilitate a different type of customers in a significant manner. They are
going well in London and now looking to expand the business in some other country.
The report will give concise information about the different aspects of expansion.

Selection of the country which can be suitable for Marvin and Smith's coffee shop
Precise information about the different countries
This is most necessary to analyse different countries ratios as it will help to make the
selection of the right country to expand the business.
Country GDP (%) Coffee Consumption(kg per
person per year)
Austria 0.542 6.1 kg
Belgium 0.632 6.8 kg
Bulgaria 0.120 2.9 kg
Croatia 0.0794 5.1 kg
Cyprus 0.0282 4.9 kg
Czech Republic 0.293 4.0 kg
Denmark 0.222 8.7 kg
Estonia 0.0327 4.5 kg
Finland 0.326 12 kg
France 3.29 5.4 kg
Germany 4.75 5.5 kg
Greece 0.257 5.4 kg
Hungary 0.184 3.1 kg
Ireland 0.432 3.5 kg
Italy 1.77 5.9 kg
Latvia 0.0404 3.4 kg
Lithuania 0.0717 3.3 kg
Luxembourg 0.0813 6.5 kg
Malta 0.0168 2.3 kg
Netherlands 1.07 8.4 kg
Poland 0.648 3.1 kg
Portugal 0.243 4.3 kg
Romania 0.282 1.9 kg
Slovakia 0.9 2.5 kg

Slovenia 0.0648 5.8 kg
Spain 1.38 4.5 kg
Sweden 0.401 8.2 kg
This is the analysis of the different countries of Europe and the description of their
respective GDP and coffee consumption. This analysis is necessary to be prepared as it
helps to make the understanding of the coffee needs in different countries. As Marvin
and Smith want to expand their coffee business in some other place selection of right
place is most necessary as it will play a vital role in terms of growth and success
(Hertel-Fernandez, et. al., 2016). The above table of different countries analysis had
driven the information that the country Finland is having the high requirement of coffee
as per person average of coffee consumption in the country is nearly 12 kg. Which is
the largest in the Europe countries. That is the major reason behind indicating the
country Finland justified the choice for business expansion.
This had been discussed that coffee consumption in the country Finland is the largest
which can be one of the reasons for expanding the business in the respective country.
The economy rate of the country is also impressive as the country has a highly
industrialized economy which is nearly equivalent to countries like France and
Germany. This is the better place to expand the business and also gives opportunities
in the context of economic balance. The other reason behind choosing the country is
that the stability criteria as the country is comparatively balanced and stable in the
context of the coffee market and growth. This stability will be followed by the time will be
passed and it will help the company to grow in a significant manner (Prokhorova, et. al.,
2016). Marvin and Smith are successfully running their business in London and know
the way to establish the business in a significant manner but have to make an analysis
of the culture of Finland.

Marketing mix in relation to the coffee shop expansion plan in Finland.
Marketing mix
The marketing mix is necessary to be analysed while expanding the business in a
different country as it gives the idea and strategies to make the expansion in a
significant manner. There are some different scenarios which needs to be followed and
managed while implementing the strategies of business expansion. The expansion of
the coffee business needs to follow different strategies to attract more customers
towards the business. The marketing mix is the collaboration of different aspect which
needs to be analysed and maintains while making the expansion of business (Zias, et.
al., 2012). Hank Marvin and Patty Smith wanted to expand their coffee business
overseas and to attain such an approach this is necessary to make a determination
about the marketing mix in a significant manner.
Product: The major concern while implementing the business is about the
determination of the quality of the product. In the context of Hank Marvin and Patty
Smith, they are running the business of coffee so the major product of their business is
coffee and this is necessary for them to understand the needs and requirements of the
customers so that they can attain more success and development.
The company had introduced some different facilities in their coffee shop which make
them different from there competitor. Marvin and Smith do not only made advancement
in their productivity apart from that they also introduced some other unique selling
approaches (Venter, et. al., 2014). As in their previous workplace, they are applying the
concept of theme nights which is successful and innovation they apply the same
approach to the new workplace.
Price: This is the major factor to be determined the price plays a vital role while
attracting the customers towards products and services. The current society is
sophisticated and standardized and their major concern is related to the productivity not
to the prices. In simple words, if Marvin and Smith want to make their products
successful then they have to give more and unique facilities and services.

The business of Marvin and Smith previously running in London and now they want to
expand their business in Finland which is a completely new place for them and they
have to make a determination about the justified price of the different varieties of coffee
(Gold, et. al., 2012). This is for sure not necessary that they will get the same price
slabs in a different country and this price calculation requires critical research over the
country.
Place: The place is the most essential requirement to start any kind of the business as
this is the medium of making the business expanded in a significant manner. Finland
will be the new place for Marvin and Smith and this is necessary to start a business
from the place which has a high range of population or have the good scope of business
(Hassan, et. al., 2013). This determination requires proper research over the different
places of Finland.
There are many places in Finland which are already accumulated with different coffee
shops but at the same time, some places can be the good option to be used as coffee
business and can be used by Marvin and Smith. In this advanced word, Marvin and
Smith should also use the way of online availability of their services this will help them
to expand their business in a significant manner.
Promotion: The effective and impactful promotion of the business is most necessary as
this will the major element to attract the customers of a different country. The promotion
approaches need to be very innovative and relevant to speak about productivity as the
business will be new in the country. Marvin and Smith can use some online and offline
strategies. The offline strategies could be the advertisements and campaign which will
give concise information about productivity (McDonald, et. al., 2013). The online method
could be social sites like Facebook and YouTube. This will help to attract more
customers as the current generation mostly likes to be on social sites.

Key factors and challenges of business expansion
The business expansion in the different country includes some different positive and
negative aspects all of such aspects needs to be determined and resolved by the time
so that business can grow and develop in a significant manner.
Human resources management
Human resources management plays the most vital role in the expansion of business in
the new country. If the company will have strong HR management then they can attain
more and justified staff for the company and also can manage the changes in the
applicable manner (Li, 2016). The business expansion in a different country will require
some belongings who can understand the needs and requirements of the local
customers which require to hire relevant candidates and it depends on the HR
management.
The expansion includes some issues and challenges like cultural differences and
increasing competition and this is necessary to overcome such issues to attain growth
and success. Human resource management to reduce such issues. The cultural
differences can be resolved if the company hire talented and local people who can
understand the mindset of local customers (Cardoza, et. al., 2015). Another thing which
can reflect while expansion is the issue of a balanced workplace as the new place will
require a new journey to settle the staff. The convincing power and management tactics
of human resource management can help to make the workplace issue resolved.
The other issue is related to the increased competition as the expansion at new place
increases the market and it needs to be managed. In this particular condition, the HR
department and higher authorities collaboratively can take some decisions which can
help to reduce the issue (Kozhikode and Li, 2012). Thus, it can be stated that the
expansion of business can be tricky for internal and external work culture but at the
same time the effective HR management can help to make approaches to reduce the
issues.
Marketing

The marketing is the most necessary element in the context of business expansion in a
new country as the business in completely new and different for the specific country and
the local market will also unfamiliar to the business owners and their productivity. The
marketing is the way to make the popularity of the business in a new country as this is
the approach to making the people aware about the services. In the current time, the
competition is comparatively high and it needs to attain some innovative strategies to
reduce the challenges. The approaches of marketing help the companies to sustain in
the market (Auerbach and Gorodnichenko, 2012). As the coffee shop of Marvin and
Smith can sustain if they have the strong market value and these can be attained if
people will be aware of the company which requires marketing.
Business expansion in a different country requires to make an impactful place in the
new market in front of new people. The current generation is most educated and if the
talk about Finland and coffee then Finland in the largest coffee consumption place and
already have a stable market (Suzuki and Okamuro, 2017). In that particular case, the
expansion needs to follow some sensible strategies to attract the existing market and
these can only be achieved if the company will implement effective marketing
approaches.

Financial analysis over the company.
Profitability
Ratios:
Particulars 2017
Return on
Assets
23.72
%
Net Margin 7.44%
The profitability of the company decides the performance of the company over the
period and hence the financial stability of the company. Marvin and Smith's Coffee
Shop has been in business for many years and shown significant growth over the years.
In 2017, the company generated a net margin of 7.44%, which is more than the industry
standards in which it operates in. Net margin showcases the overall profitability of the
company and hence the financial performance and stability of the company. Net margin
helps the company to analyse the current profit-earning capacity of the company and
hence helps the company to formulate and implement the long term strategic goals of
the company (McDonald, et. al., 2013). Return on Assets comes out to be 23.72% for
the year, suggesting that the company have been efficiently utilising the assets of the
company in generating income and that the investment made into the assets is
generating a return of 23.72%. Profitability analysis will help the company to identify the
current capabilities of the company and hence help in deciding future plans and
projects. Company is stable and performing well over the year and hence may go
forward with the expansion project.

2017
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
Profitability Ratios
Return on Assets Net Margin
Liquidity Ratios:
Particulars 2017
Current Ratio
5.7
1
Quick Ratio
4.4
2
Liquidity ratios comment on the liquidity and the solvency of the company and its ability
to pay off its debts on a timely basis. Liquidity of the company suggests that the
company is able to generate funds to meet its liabilities on time, such that it helps the
company to stay liquid and solvent in the market. Company's liquidity ratio has turned
out to be 5.71 for the year, suggesting that the company is highly liquid and suggests
that there is a huge margin in the current assets and liabilities of the company. This also
suggests that the company has huge funds blocked in its working capital, and hence,
this may not be an ideal situation from the operational efficiency point of view. But as
the company is planning to expand, the company will require generating funds for
meeting expenses and liabilities (Prokhorova, et. al., 2016). For this purpose, the
company is required to depend on the results of the quick ratio, which has turned out to

be 4.42. Quick ratio calculates the company's ability to generate funds on more short
notice and hence more helpful in a situation where the company is planning to expand.
2017
-
1.00
2.00
3.00
4.00
5.00
6.00
Liquidity Ratios
Current Ratio Quick Ratio