Unit 42 Planning for Growth: Business Development Report

This report provides a comprehensive analysis of business growth strategies, focusing on the application of Ansoff's growth matrix, potential funding sources, and the development of a detailed business plan. It explores various growth options, including market penetration, product development, market development, and diversification, while considering associated risks and mitigation strategies. The report also evaluates different funding sources like loans, personal savings, and working capital, justifying the adoption of specific sources based on organizational needs. Furthermore, it presents a business plan demonstrating the successful formulation and achievement of business objectives, including relevant financial information. Finally, the report offers a critical evaluation of exit or succession options for small businesses, providing recommendations to support implementation.

Unit 42
Planning for
growth

Contents
INTRODUCTION...........................................................................................................................3
TASK-1 Critically evaluate specific options and pathways for growth using a range of
analytical frameworks (Ansoff‘s growth matrix in particular), taking into account the risks of
each option and how they can be mitigated.................................................................................3
TASK-2 Critically evaluate potential sources of funding with justified argument for the
adoption of a particular source or combination of sources, based on organizational needs........5
TASK-3 Present a coherent and detailed business plan that demonstrates knowledge and
understanding of how to formulate, apply and achieve business objectives successfully.
Suitable financial information should be included......................................................................6
TASK-4 Provide critical evaluation of the exit or succession options for a small business and
decide appropriate course of action with justified recommendations to support
implementation............................................................................................................................8
CONCLUSION................................................................................................................................9
REFERENCES................................................................................................................................9

INTRODUCTION
Planning for growth refers to the situation when small business start thinking of achieving
the goal in the long run and helps in checking the targets on the daily basis so the decision
are to be taken regarding the future growth (Aguzarova and Aguzarova, 2018). Steps are
to be taken carefully in the starting so that in the future no risk will arise and the decisions
are to be taken properly in the business. If the external funding is taken by the business or
from the partners it helps in creating the clear vision in the mind of the customer so the
targets will be achieved in an easy manner. The water house restaurant is studied in this
report to know all its details regarding its planning and the growth in the near future. The
topics covered under this report are the specific options and the pathways used by the
organization and the Ansoff matrix, potential source of funding from where the money is
generated, business objectives so that the company may have the growth and can earn the
profit in the long run easily. The source of funding the marketing plan is also study in this
report to know the actual position and the growth of the company while establishing the
new business.
TASK-1 Critically evaluate specific options and pathways for growth using a range of analytical
frameworks (Ansoff‘s growth matrix in particular), taking into account the risks of each option
and how they can be mitigated.
The Ansoff matrix helps in analyze the plan and the growth strategies of a market in a
particular manner (Zhou, 2017). It helps in accomplishing the growth of a business and helps
in reaching the goal. There are four strategies in this matrix which helps in analyzing the risk
in proper manner and help in accomplishing the task in an organization. It helps in creating a
good understanding of an organization to analyze the risk in a proper manner. The four
strategies are market penetration, product development, market development and
diversification. Below these strategies are described in detail (Baschat, 2018).
Market penetration: this refers to the increase of the sale of the product that is already in the
market. It helps in identifying the growth of the particular product which helps in increasing the
competition and earning the profits by the company. It helps in increasing the share in the market
and helps in building the image so that the company have its competitive advantage and can
easily run the business for the long run. The company chosen for the topic is the warehouse
restaurant which is a hidden hackney gem and helps in providing the spacious place to the busy
urban peoples with calm surrounding and an exclusive menu. The restraint is only the one in that
area which helps in building the competitive advantage and helps in increasing the sales of the
restaurants. Because of its menu and the surrounding the people like it most and come there to
spend their time. The services provided are amazing which may attract the customers to build the
relationship for the long run. The new services are also added like the dishes which may attract
customers and which are in demand. Ansoff matrix in market penetration with the aim of market

share through its present product in an established. This concept is generally about selling more
of restaurants present product to existing market. In order to penetrate as well as grow its
customer base existing market it of restaurant could decrease its prices to attract more customers,
enhance its distribution network, invest more in marketing operations, acquiring competitors
operating in food and beverages market increase in production capacity.
Market Development: It is an strategy in which the firm with its existing products enter the new
market and helps in differentiating the products with the other. In this the Waterhouse café open
the branch in the domestic as well as in the foreign region so that the customer will know about
the and start going the restaurant in which they see the uniqueness (Perveen, 2017). It helps in
building the overall image of the water house restraint and makes the customer more attracted by
providing them services which are unique and different. The area should be calm enough like the
main branch h which make the customers more excited to go the restaurant. As when a company
enters into a new market with its present product. As entering into a new market could seem to
be on basis of geographies, customer segments as well as regions. It uses in catering a different
customer segment, entering a new domestic market in order to expand business regionally as
well as entering into a foreign market for expanding internationally.
Product development: It refers to the development of the product in the existing market which
helps in building the good image and helps in providing the services which may attract them.
The cafes or restaurant should firstly decide and do the proper research on the product they are
developing in the market on that basis only they should developed otherwise there is a chance the
company may go on the loss. If they are developing the new the product they should the proper
expense and the expecting profit in the future (Biddle and Taylor, 2018). The dish or the
innovative things may attract the customers and helps in building the competitive advantage in
the future. It helps in meeting the needs of the customers in the proper manner and makes them
attract easily so the company may have the chance to earn the profit. The uniqness of the product
is a better way of reaching the customer. Company should develop the product that is
environmental friendly so that the targets are to be accomplished in a proper manner and helps in
reaching the goal and satisfying the needs and the desires of an individual. In terms of ansoff this
element will help in company to develop new products in order to enter into an existing market.
It generally consists of extensive research as well as development in order to expand their

product range. It leads in investing research and development activities to to design new products
for entering existing markets, acquiring a competitor's product which are able to meet
requirements of market, having joint venture with other companies in order to merge resources
for developing new products along with making strategic partnerships with other companies to
gain access to each partner distribution channels.
Diversification: It is a strategy in which they is an entrance with the new product in the new
market which helps in accomplishing the goals and reaching the target market easily. In this
strategy there are high chances of the risk as the product is new and the product is growing the
new market so there are chances the company may have the growth or the company may suffer
from the loss. It helps in building the market share and helps in reaching the customer in a proper
manner (Chapin, 2017). There are the two types of diversification related and unrelated
diversification. Related diversification refers to diversify the market with the related product
only which may increase the chance of growth and the company may earn the profit. Unrelated
diversification refers in which the unrelated product is sold in the market which is risky enough.
The Water house restraint may enter the new market or shift to new place by making the thinks
unique which helps in increasing the competition and the risky one as the company has invested
the large money the company may suffer from the loss or from the profit. Diversification
strategies are related about entering new markets through new products which is related to an
unrelated company for their existing offerings. It could be carried in concentric, conglomerate as
well as vertical diversification. As companies could carry diversification in their related
segments for potential synergies along with and related diversification that could be carried
between existing business as well as new product.
TASK-2 Critically evaluate potential sources of funding with justified argument for the adoption of a
particular source or combination of sources, based on organizational needs.
There are different sources of finance which are used by the business and the small enterprise
to run them for the long run and helps in increasing the profit. There are various sources of
finance like loans savings, investments, overdraft facilities, share capital which are used by the
individual while opening a new business. Water house restaurant may take the loans, or savings
or any other source of investment (Park and LaFrombois, 2019).
 Loans: Loans helps in providing the longer finance for the start ups or for the small
business over the period of 5 years and have the fixed rate of interest and the time period.
The bank needs the security when the money is taken by the individual as loan. It is a

person guarantee of and entrepreneur and a low rate of interest. Water house restaurant
may take the loan for the bank and can repay them after some years with the fixed rate of
interest. The main advantage of the bank is the large amount of the loan can be taken by
an individual. The interest rate is lower than the bank overdraft. The disadvantage of the
loan is the amount decided is to be repaid on the date of agreement and the high rate of
interest is charged.
 Personal savings: Personal savings refers to the money that is bought by the person as
the owner share holder in which there is no risk. From the past savings the person saved
money and has invested in it. There is no interest rate and has no burden on the people
regarding the repayment of the money. Water house restaurant may use the personal
saving as the source of funds as there is no risk in it. The advantages of the personal
savings are there is no collateral regarding the lending of money to the business, no
paperwork is there and interest free and have no stress regarding the repayment of the
loan. The disadvantage of the personal saving is that the personal savings cannot be used
where large funds are required and the business may face the cash flow problems in the
future (DODDS, DIMANCHE and SADOWSKI, 2018).
 Working capital: it refers to the money need by the business to meets its day to day
activities which helps in running the business in proper manner and helps in reaching the
goal in an organization. Working capital refers to the current assets- currents liabilities
and it is also a source of finance which helps the business to run in the long run. The
water house restaurant may use the working capital as the source of fund as its helps in
meeting the day to day expenses and helps in business to run in the long run. The
advantages of the working capital are as no cost will involved as it is an internal source of
finance, there is no repayment is required of the money, and no other person can take the
decision. The disadvantages of the working capital are that the cost of opportunity is
involved, this type of funding is not required for the long run, and the risk is of the
company alone (Gumel, 2019).
 Bank overdraft: It helps in providing the facilities of the short term credits to the account
holders by the banks to fulfill the requirement in a proper manner. In this the person can
withdraw the money from the bank more then he actually holds. And the interest is to be
charged on the extra amount withdrawal by an individual. It helps in solving the
problems of the short term cash flow and helps in making the decisions properly. The
water house restaurant may with drawl the money when they are in need this facility is
available to them. The advantages of the overdraft facility are there is no need of security
while withdrawing the money from the bank, it is n deficit of the short term cash flows, it
is easy and arranged quickly. The interest is to be charged only when the extra amount is
withdrawn from the bank. Disadvantages of the overdraft facility are there is no limit of
the extra amount withdrawn. Some time the bank charge the overdraft facility and the
interest are to be calculated on the regular basis. Overdraft facility helps in recovering the
short term objectives not the long term goals of an organization (Olmos, 2020).

TASK-3 Present a coherent and detailed business plan that demonstrates knowledge and
understanding of how to formulate, apply and achieve business objectives successfully. Suitable
financial information should be included.
Business plan helps in identifying the future opportunities and helps in achieving the targets
in the proper manner so the company may have the growth and can run the business in long
run (Wu, 2018). Every company, café, restaurants first builds the business plan after that only
they will apply that plan into real. The water house restaurant builds the business plan decide
its mission vision strategies so that the targets are to be achieved properly and have the long
term growth in the market. Below is the description of the detailed business plan which helps
in achieving the targets in the proper manner:
 Vision of the company: The business plan started by analyzing the vision of the company
in the future their dream. It helps in doing the planning accordingly. What the café look
like? How it will be decorated? Locations? Items for sale? These all things are to be
observed in the first step it helps in proper raising of the funds and helps in decision
making so the targets are to be achieved properly (Krumholz and Hexter, 2018).
 How will the café succeed: It helps in identifying the strategies used by the individual so
that the café can run for the long time and have the good image in the market? This is the
second steps which are to be taken by an individual so that the business can be run and
have the market share and the brand image.
 Studying the competition: To know about the competition is the biggest step it helps in
knowing the competitors around the café and what are the strategies they are adopting to
have a market share so that they can run their business in long run. The individual should
know there competitors so that they cannot beat in future and have an healthy
competition the market (Li, Xu and Li, 2020).
 Analyzing the target market: The main of the individual while opening the business is
selecting the target market so that they can understand the demand of that thing in those
areas. Target market can be analyzed easily by surfing the market their competitors which
help in analyzing the growth. The water house café should analyze its competitors in that
area and know the customers weather they are interested in going the restaurant or not.
Tell what you sell and how will you sell it: The individual should know what they are selling
in the market as they have to decide their menu so that they should know the actual expense
that occur in the food preparation. If the restaurant has the liquor then they have the license
of that too and have government permission so that no issue will arise in future. After the
restaurant will open the individual can make the changes later on but in starting the actual
amount of the one dish is to be calculated properly so that in future it will not get affect.
Proper research should be done by the water house café so that there will be no future loss
(Syssner and Meijer, 2017).
Create a marketing plan: Marketing plan should be decided of how to advertize about the
restaurants, the pamphlets should be sold. Loyalty and the promotional programs are to be

organized which helps in attracting the customers in a proper manner. Marketing plan is a
most important part of the business plan. The water house café should have the proper
marketing planning which helps in making the customer attract so that the restaurants helps
in beating the competitive market and helps in building the brand image. The restaurants
have new technology which helps in reaching the customers easily. Adopting new
technology makes the work easier.
 Talk about yourself: The individual opening the business make the persons know about
its structure of ownership. The individual should that how much it are experienced and
innovative so the customers may increase their loyalty and helps in building the good
relationship and tell them how they choose the right person for the right job. The water
house restaurant should choose the person for the job carefully who have enough
knowledge about the work and are experienced enough (Olesen and Carter, 2018).
 Your plan of operations: They should have the high operating cost. The direct and the
indirect cost are to be managed properly so that there is a competitive advantage. The
inventories are to be managed properly and have the chances the increase the result of
growth and help in building the brand image and have the competitive structure.
Operating cost is to be calculated carefully as the business can run for the long run. The
water house restaurants should maintain its operation cost in proper manner so that the
company may not suffer from the loss in the future. Operations are to be calculating and
maintain its accounts properly (MacDonald, 2018).
 Money talks: Before going for a business plan the individual should know what the
source of fund internal or external is. These are to me decided carefully as money is the
most important part while establishing the business and may have the growth in the
future. The cost included are start up cost, income statement, cash flow so the decisions
are to be taken properly. The water house restaurants should maintain the proper books of
the account so that the there will be no mistake and have the regular recording of each
and every transaction that will occur so that the no problem will rise in the future.
The business plan is very important as its helps in deciding the business and satisfying the
needs of the individual and earns the profit for the long run (Rudolf, Kienast and Hersperger,
2018).
TASK-4 Provide critical evaluation of the exit or succession options for a small business and
decide appropriate course of action with justified recommendations to support implementation.
 There is various exit strategy that are adopted by the business during its failure as
it helps in getting the back money they have invested while opening the business. Small
business have the chances that they may suffer from the losses and should be recovers
after selling all its assets in an proper manner so that in the future some amount of return
will get and the credit payments are to be made easily. Liquidation is one of the strategy
which should adopt by the small business by selling the assets the money can come it is
the best option when there is an individual owner of the particular business. The

individual can sell that business to the manager or the employee so that the person may
have the benefit and can run it for long run. It also helps in increasing the profit for the
company and the capital will rise automatically and reach the customers in the proper
manner (Nikolopoulos, 2021). If the business is profitable then it can sell to the open
market which helps in increasing the goodwill and can get the good price from the
market. The person can sell the business to the business so that the business can expand
and helps in increasing the profits and helps in reaching the target market easily. It has
been recommended that the person should use the strategies in a proper manner and
should research the market properly so that in the future they can run the business and if
any issue arises it will be sort at that time only. Before starting the business the individual
should know about the taste, needs and the demands of the people accordingly the
innovation should take place so the business should have the good market share and
growth. Business plan should be prepared properly and the source of the fund is an
important factor by which the person invested in the business. Loans and the personal
saving are the best source of finance used so that they can do the work accordingly.
Loans the person has to pay the interest rate and should have to deposit something as
security money as the bank should have the guarantee that the money will be back. As
well there are some benefits and drawbacks of the succession of the small business is as
follows- ‘
 Benefits- the succession plan of the small business is regarding the circumstances gives
the succession that takes the specific place and the specific dates. As well as provide the
list of the potential successors that include the strengths and the order of the
considerations. Apart from this, the succession planning of the small business helps to
align the strategic goals at the right people at the right place in order to achieve the
desired goals. as well as the development of the business because this is the important
part that operating the business as well as the business succession helps on the
arrangement to make the smooth transition and to reduce the any of the negative effects
of the departure of the company.
 Drawbacks- there are some of the key problems of the succession action that is related to
the creation as well as the identification of the sufficient skills. That helps the people in
the together. apart from this appointing the wrong person that can lead the various
problems within the organization, that will lead the result for the poorer company
performance and the turnover of the employee. This succession part also selects someone
too quickly and appoint someone that result not better candidate later.
CONCLUSION
From the above report it has been concluded that the planning for growth helps in
reaching the task of the business in proper manner and helps in achieving the goals in the future.
Business starts thinking about the future and there long term prospective so that they can beat the
competitors in the proper manner and helps in indulging in the activities. The ansoff matrix helps

in finding out the actual position of the company and its growth which helps in reaching the
target properly. Various source of findings like savings, loans are studied so that the business
man can take the long and can run in the long term. It helps in achieving the targets and helps in
measuring the performance of the company from the past results. The risks are taken by the
company as they have invested the high amount so they are expecting high returns if they work
step by step in achieving the targets of an organization in proper manner. If the risk is high the
company may have the high returns in the future because of that the company may earn the
profits also. There are various source of money are studied like loans, personal saving, overdraft
facility which helps in investing the money properly and the business plan which helps in
knowing what are the things the individual should do while prepare the plan all the steps are to
be studied properly while thinking about the business so that it can run for long time and can
gain the profit easily. Business targets and the goals are to achieved which helps in reaching the
targeted customers easily and should follow the strategies in an proper manner so that the goals
can be achieved.

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