Business Growth Plan: The Little Square Restaurant
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Planning for growth
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TABLE OF CONTENTS
No table of figures entries found.....................................................................................................3
Introduction......................................................................................................................................4
LO1..................................................................................................................................................5
P1 Analyse key considerations for evaluating growth opportunities and justify these
considerations within an organisational context..........................................................................5
P2 Evaluate the opportunities for growth applying Ansoff’s growth vector matrix...................8
LO2................................................................................................................................................11
P3 Assess the potential sources of funding available to businesses and discuss benefits and
drawbacks of each source..........................................................................................................11
LO3................................................................................................................................................14
P4 Design a business plan for growth that includes financial information and strategic
objectives for scaling up a business...........................................................................................14
LO4................................................................................................................................................16
P5 Assess exit or succession options for a small business explaining the benefits and
drawbacks of each option..........................................................................................................16
Conclusion.....................................................................................................................................18
References......................................................................................................................................19
No table of figures entries found.....................................................................................................3
Introduction......................................................................................................................................4
LO1..................................................................................................................................................5
P1 Analyse key considerations for evaluating growth opportunities and justify these
considerations within an organisational context..........................................................................5
P2 Evaluate the opportunities for growth applying Ansoff’s growth vector matrix...................8
LO2................................................................................................................................................11
P3 Assess the potential sources of funding available to businesses and discuss benefits and
drawbacks of each source..........................................................................................................11
LO3................................................................................................................................................14
P4 Design a business plan for growth that includes financial information and strategic
objectives for scaling up a business...........................................................................................14
LO4................................................................................................................................................16
P5 Assess exit or succession options for a small business explaining the benefits and
drawbacks of each option..........................................................................................................16
Conclusion.....................................................................................................................................18
References......................................................................................................................................19

LIST OF FIGURES
Figure 1: Four dimensions to a core competence 6
Figure 2: Porter generic strategies 7
Figure 3: Ansoff matrix 9
Figure 1: Four dimensions to a core competence 6
Figure 2: Porter generic strategies 7
Figure 3: Ansoff matrix 9
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Introduction
The businesses need to plan the growth to ensure high profitability, expansion in the service area
and to retain the values associated with the business. The growth is required to make the business
competitive and capable to drive the profitability and mission to the end customers. The
presented report will discuss the context of ‘The Little Square’ restaurant which is operating in
Shepherd. The report will discuss the key considerations for growth opportunities. The report
will discuss how the organization can use the Ansoff matrix to determine the risk in the growth
and how it can align to the opportunities to ensure high profitability and sustainability. The
report will discuss potential sources of the funding including bank loans, venture capital and
angel investments. The business plan for the growth also will be discussed along with options for
the exit and succession. The report has main purpose to provide knowledge on the planning to
achieve business growth with consideration of the suitable strategies.
The businesses need to plan the growth to ensure high profitability, expansion in the service area
and to retain the values associated with the business. The growth is required to make the business
competitive and capable to drive the profitability and mission to the end customers. The
presented report will discuss the context of ‘The Little Square’ restaurant which is operating in
Shepherd. The report will discuss the key considerations for growth opportunities. The report
will discuss how the organization can use the Ansoff matrix to determine the risk in the growth
and how it can align to the opportunities to ensure high profitability and sustainability. The
report will discuss potential sources of the funding including bank loans, venture capital and
angel investments. The business plan for the growth also will be discussed along with options for
the exit and succession. The report has main purpose to provide knowledge on the planning to
achieve business growth with consideration of the suitable strategies.
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LO1
P1 Analyse key considerations for evaluating growth opportunities and justify these
considerations within an organisational context
Growth is the fundamental expectation while establishing and running a business even at a small
scale. Therefore, the growth opportunities are required to grab with proper identification and
alignment to the organization to achieve the competitive advantages. For example, ‘The Little
Square’ restaurant has small scale operations and services at the heart of Shepherd. The
organization has growth opportunities such as entering into developing market, franchise to
others, development of own business chain and to integrate with others for expansion (Blackburn
et al., 2013). The organization can consider the following major things while evaluating the
growth opportunities:
Basis of competitive advantages
The competitive advantage for the organization is that it can expand the business functions and
operations in the form of a restaurant chain and can improve the earning. The basis of
competitive advantages becomes the foundation of growth. The organization has to consider the
following two major things under the competitive advantages to achieve the growth
opportunities:
Resources: The organization has to ensure that there is selection and recruitment of the skilled
and capable resources at workplace to attain the goals. The lack of the skills, resources and
support from them can hinder the business to meet the competitive advantages. ‘The Little
Square’ needs to analyze the capabilities in resources to foresee and plan the growth (Ward,
2016). The competitive skill set, professionalism, alignment to the international market
expectations and legal framework and coordination with other functional departments within the
business are essential to consider.
Capabilities: The organizational capabilities in term of the customers, employees, physical
assets, infrastructure and corporate connections are also significant to consider during the
competitive advantage. In the context of the organization, the capabilities are good enough for
P1 Analyse key considerations for evaluating growth opportunities and justify these
considerations within an organisational context
Growth is the fundamental expectation while establishing and running a business even at a small
scale. Therefore, the growth opportunities are required to grab with proper identification and
alignment to the organization to achieve the competitive advantages. For example, ‘The Little
Square’ restaurant has small scale operations and services at the heart of Shepherd. The
organization has growth opportunities such as entering into developing market, franchise to
others, development of own business chain and to integrate with others for expansion (Blackburn
et al., 2013). The organization can consider the following major things while evaluating the
growth opportunities:
Basis of competitive advantages
The competitive advantage for the organization is that it can expand the business functions and
operations in the form of a restaurant chain and can improve the earning. The basis of
competitive advantages becomes the foundation of growth. The organization has to consider the
following two major things under the competitive advantages to achieve the growth
opportunities:
Resources: The organization has to ensure that there is selection and recruitment of the skilled
and capable resources at workplace to attain the goals. The lack of the skills, resources and
support from them can hinder the business to meet the competitive advantages. ‘The Little
Square’ needs to analyze the capabilities in resources to foresee and plan the growth (Ward,
2016). The competitive skill set, professionalism, alignment to the international market
expectations and legal framework and coordination with other functional departments within the
business are essential to consider.
Capabilities: The organizational capabilities in term of the customers, employees, physical
assets, infrastructure and corporate connections are also significant to consider during the
competitive advantage. In the context of the organization, the capabilities are good enough for

the physical assets, customers and employees to meet the current requirements but the growth
opportunities also need improvements in the infrastructure, technical tools and techniques and
strong corporate connections for the smooth execution with high profitability.
Core competencies: The organization has to consider the core competencies during evaluation of
growth opportunities. For example, the organization has strong managerial system to select,
manage and control the skilled resources whereas the managerial system also aligned to retain
the employees with high satisfaction at workplace. Besides to this, the organization also needs to
consider technical capabilities as well as skills and knowledge to acquire the growth
opportunities (Cassidy, 2016). In the context of ‘The Little Square’, it is determined that the
organization has good management to achieve the growth opportunities but there skill need of
strong technical and knowledge values. For example, facts, figures and experience are essential
to evaluate the growth opportunities so that the returns, investments and future risks can be
estimated with high precision.
Figure 1: Four dimensions to a core competence
Generic strategies
Porter’s generic strategies are also essential to consider for the planning. According to the model,
the organization can consider the broad and narrow market to compete with others in the industry
whereas source of the competitive advantage is differentiation or cost. For example, ‘The Little
Square’ follows differentiation leadership where the organizational products such as recipes and
opportunities also need improvements in the infrastructure, technical tools and techniques and
strong corporate connections for the smooth execution with high profitability.
Core competencies: The organization has to consider the core competencies during evaluation of
growth opportunities. For example, the organization has strong managerial system to select,
manage and control the skilled resources whereas the managerial system also aligned to retain
the employees with high satisfaction at workplace. Besides to this, the organization also needs to
consider technical capabilities as well as skills and knowledge to acquire the growth
opportunities (Cassidy, 2016). In the context of ‘The Little Square’, it is determined that the
organization has good management to achieve the growth opportunities but there skill need of
strong technical and knowledge values. For example, facts, figures and experience are essential
to evaluate the growth opportunities so that the returns, investments and future risks can be
estimated with high precision.
Figure 1: Four dimensions to a core competence
Generic strategies
Porter’s generic strategies are also essential to consider for the planning. According to the model,
the organization can consider the broad and narrow market to compete with others in the industry
whereas source of the competitive advantage is differentiation or cost. For example, ‘The Little
Square’ follows differentiation leadership where the organizational products such as recipes and
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pre-cooked food items are different in taste and quality to attract the broad customer market. The
organization also can explore the cost leadership concept in which the organization can increase
the cost per product to create and manage the brand values (Minja and Mutunga, 2015). It can
help to present the products and services as the premium products in the market. In new markets
where growth opportunities seems feasible, the organization also can become ‘cost focused’ in
which the cost is varied according to the market trends, challenges and opportunities. It allows
attaining the goals with customer-oriented pricing on the products to boost the sales (Tanwar,
2013). Differentiation focus strategy is also useful for the business when the variant of the
existing product is capable to drive the market profitability.
Figure 2: Porter generic strategies
Linking competitive advantage with opportunities for growth
The organization also can link and analyse competitive advantage with external business
environment. For example, the political environment is stable in American market whereas the
increasing flexibilities in the international business regulations are in favour to attain the growth.
The small businesses are being exempt from taxation when they are not capable to meet the
certain limit of the turnover whereas the governmental programs and subsidies on the small and
medium size businesses are major advantage (Salavou, 2015). From the economic aspect, small
businesses are the major shareholder in the national economy as they form ninety nine percent of
the private sectors with largest employment provider. The organization has strong roots in the
organization also can explore the cost leadership concept in which the organization can increase
the cost per product to create and manage the brand values (Minja and Mutunga, 2015). It can
help to present the products and services as the premium products in the market. In new markets
where growth opportunities seems feasible, the organization also can become ‘cost focused’ in
which the cost is varied according to the market trends, challenges and opportunities. It allows
attaining the goals with customer-oriented pricing on the products to boost the sales (Tanwar,
2013). Differentiation focus strategy is also useful for the business when the variant of the
existing product is capable to drive the market profitability.
Figure 2: Porter generic strategies
Linking competitive advantage with opportunities for growth
The organization also can link and analyse competitive advantage with external business
environment. For example, the political environment is stable in American market whereas the
increasing flexibilities in the international business regulations are in favour to attain the growth.
The small businesses are being exempt from taxation when they are not capable to meet the
certain limit of the turnover whereas the governmental programs and subsidies on the small and
medium size businesses are major advantage (Salavou, 2015). From the economic aspect, small
businesses are the major shareholder in the national economy as they form ninety nine percent of
the private sectors with largest employment provider. The organization has strong roots in the
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local market and so that it has economic strengths to compete for the desired growth
opportunities. The social-cultural environmental diversity, high disposable income, employment
and other things are supporting the business growth.
Technological advances and organizational capabilities to update with the technology are helping
to reduce the cost and efforts on the practices. However, it is also creating a threat of data
disclose. The legal frameworks are also supporting small businesses to contribute effectively in
the economy (Storey, 2016). The organization has most of the waste in the form of organic food
product which is being recycled whereas the increasing focus on the crop growing is helping to
deliver a more cost effective and quality products to the customers.
Innovation
The alternative is to develop new product or service as a basis of growth. The organization can
consider the use of Boson matrix to determine the value of the products and services so that
accordingly development and investment can be considered. For example, the cash cow products
those are high profit generating products can be promoted whereas the products with inactive
profitability can be discarded for a while on current stage to attain the profitability. Similarly, the
use of McKinsey matrix is also considerable in the growth opportunity evaluation because it can
help the organization to understand the business position and industry attractiveness so that the
organization can decide between harvests or invest approach. Besides to it, the organization has
to analyze product life cycle to determine the durability of the investment in the market to
generate profitability (Burns and Dewhurst, 2016). For example, suppose a particular dish is
prepared to serve the Asian market during Olympics in the country then there is no life of the
products when visitors go back to their countries after event. Also, the diffusion of the
innovation with time is also required to consider.
P2 Evaluate the opportunities for growth applying Ansoff’s growth vector matrix
‘The Little Square’ restaurant has opportunities for growth but it is also essential to uncover the
risks those are hinder the business growth. Ansoff matrix is a significant tool to analyze the
business market while the business is thinking to conquer the customers through differences. It
means that the matrix is useful to estimate the outcomes of the differences in the product or
services with respect to the market conditions (Hussain et al., 2013). The matrix helps to
opportunities. The social-cultural environmental diversity, high disposable income, employment
and other things are supporting the business growth.
Technological advances and organizational capabilities to update with the technology are helping
to reduce the cost and efforts on the practices. However, it is also creating a threat of data
disclose. The legal frameworks are also supporting small businesses to contribute effectively in
the economy (Storey, 2016). The organization has most of the waste in the form of organic food
product which is being recycled whereas the increasing focus on the crop growing is helping to
deliver a more cost effective and quality products to the customers.
Innovation
The alternative is to develop new product or service as a basis of growth. The organization can
consider the use of Boson matrix to determine the value of the products and services so that
accordingly development and investment can be considered. For example, the cash cow products
those are high profit generating products can be promoted whereas the products with inactive
profitability can be discarded for a while on current stage to attain the profitability. Similarly, the
use of McKinsey matrix is also considerable in the growth opportunity evaluation because it can
help the organization to understand the business position and industry attractiveness so that the
organization can decide between harvests or invest approach. Besides to it, the organization has
to analyze product life cycle to determine the durability of the investment in the market to
generate profitability (Burns and Dewhurst, 2016). For example, suppose a particular dish is
prepared to serve the Asian market during Olympics in the country then there is no life of the
products when visitors go back to their countries after event. Also, the diffusion of the
innovation with time is also required to consider.
P2 Evaluate the opportunities for growth applying Ansoff’s growth vector matrix
‘The Little Square’ restaurant has opportunities for growth but it is also essential to uncover the
risks those are hinder the business growth. Ansoff matrix is a significant tool to analyze the
business market while the business is thinking to conquer the customers through differences. It
means that the matrix is useful to estimate the outcomes of the differences in the product or
services with respect to the market conditions (Hussain et al., 2013). The matrix helps to

understand the market and services during the growth planning. Following are four major
quadrants of the matrix those are discussed in the context of the organization:
Market penetration is most safe approach in growing strategies because the organization has to
boost the sales in the existing market whereas there is no additional cost on the market leading
and attraction and product development. However, the growth needs significant consideration of
the profitability because sometime there is need of cost reduction in price even for a small time is
required to attract the market. Besides to it, the cost is consumed in the marketing, distribution
and other operations to make operations growing (Gianos, 2013). It is also determined that the
organization has slightly higher risk in the product development because there is need of
innovation whereas the market and product both are new to each other. Here, the organization
has high risk to market and sustain the products.
Figure 3: Ansoff matrix
Market development strategy is seems significant for the organization. The restaurant can use the
existing products and services to cover the market which is much similar to the existing market.
The strategy has benefits to reduce the cost and efforts whereas there is high assurance of the
return on the practices. For example, the organization can promote the existing products or can
add a few new features to make it compatible in the new market (Shaw, 2012). There is lower
quadrants of the matrix those are discussed in the context of the organization:
Market penetration is most safe approach in growing strategies because the organization has to
boost the sales in the existing market whereas there is no additional cost on the market leading
and attraction and product development. However, the growth needs significant consideration of
the profitability because sometime there is need of cost reduction in price even for a small time is
required to attract the market. Besides to it, the cost is consumed in the marketing, distribution
and other operations to make operations growing (Gianos, 2013). It is also determined that the
organization has slightly higher risk in the product development because there is need of
innovation whereas the market and product both are new to each other. Here, the organization
has high risk to market and sustain the products.
Figure 3: Ansoff matrix
Market development strategy is seems significant for the organization. The restaurant can use the
existing products and services to cover the market which is much similar to the existing market.
The strategy has benefits to reduce the cost and efforts whereas there is high assurance of the
return on the practices. For example, the organization can promote the existing products or can
add a few new features to make it compatible in the new market (Shaw, 2012). There is lower
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risk because the organization has backup of the existing market to make sales of the products
those are not used in market development strategy.
Diversification is determined as most risky strategy for the organization. Here, the organization
has to market a new product into a new market and so that there is nothing clear on the outcome
and risks during the practices (Hussain et al., 2014). The unproven environment for product is
the most risky factor to consider.
those are not used in market development strategy.
Diversification is determined as most risky strategy for the organization. Here, the organization
has to market a new product into a new market and so that there is nothing clear on the outcome
and risks during the practices (Hussain et al., 2014). The unproven environment for product is
the most risky factor to consider.
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LO2
P3 Assess the potential sources of funding available to businesses and discuss benefits and
drawbacks of each source
Finance is the foremost requirement to plan the growth. The organization has opportunities to
use the several types of the funding sources but each source has own benefits and drawbacks
those are essential to consider.
Bank loans
The organization can take credit from the banks on the current assets of the business so that the
funding can be used to expand the business. The banking and financing institutes can support the
business with a fixed interest rate whereas they also calculate the net present values of the
business. Therefore, there is high scope to take funding of the desired amount on the values of
the assets but the risks of payback are also high under the interest rate terms (Wehinger, 2012).
Benefits: large funding needs can be fulfilled easily with no hassle of the intermediate agents.
Also, it is flexible to pay in suitable installments. The organization has cost effectiveness while
consider the time to repay of the particular amount. Besides to it, there is no hassle of the
taxation and the organization can retain the profits because the bank loans have no share in the
profit, they are only needs principle amount and interest on it (Harrison and Baldock, 2015).
Drawbacks: However, the requirements are strict so that the business must need to present the
required documents to justify the eligibility. Also, repayment might be a burden because of the
long term repayment periods and due to irregular payments to the banks. Each irregular payment
to bank has financial loss for the business.
Crowd funding
It means to collect the capital from community and public. However, it is rarely possible for an
organization to collect finance for business growth purpose until and unless the organization is
not linking it with the community advantages.
P3 Assess the potential sources of funding available to businesses and discuss benefits and
drawbacks of each source
Finance is the foremost requirement to plan the growth. The organization has opportunities to
use the several types of the funding sources but each source has own benefits and drawbacks
those are essential to consider.
Bank loans
The organization can take credit from the banks on the current assets of the business so that the
funding can be used to expand the business. The banking and financing institutes can support the
business with a fixed interest rate whereas they also calculate the net present values of the
business. Therefore, there is high scope to take funding of the desired amount on the values of
the assets but the risks of payback are also high under the interest rate terms (Wehinger, 2012).
Benefits: large funding needs can be fulfilled easily with no hassle of the intermediate agents.
Also, it is flexible to pay in suitable installments. The organization has cost effectiveness while
consider the time to repay of the particular amount. Besides to it, there is no hassle of the
taxation and the organization can retain the profits because the bank loans have no share in the
profit, they are only needs principle amount and interest on it (Harrison and Baldock, 2015).
Drawbacks: However, the requirements are strict so that the business must need to present the
required documents to justify the eligibility. Also, repayment might be a burden because of the
long term repayment periods and due to irregular payments to the banks. Each irregular payment
to bank has financial loss for the business.
Crowd funding
It means to collect the capital from community and public. However, it is rarely possible for an
organization to collect finance for business growth purpose until and unless the organization is
not linking it with the community advantages.

Benefits: It is the fastest way to collect finance where the business has not to pay upfront fees.
Same time, it also creates marketing values and enable the business to understand the opinions
and reaction of the public. Therefore, the organization can get finance away from the
conventional investors and banks (Belleflamme et al., 2014).
Drawbacks: There is need to develop the interest of people to encourage them for investment
whereas it shows that the business is not financially capable to accomplish a particular task.
There is loss of reputation as well as practices if required amount is not collected. Most of the
projects are also not suitable for crowd funding.
Peer-to-peer lending
It is the practice to map individual lending party to the borrowing party. The borrower might a
person or a business. It means that there is direct lending of the money to achieve high
profitability.
Benefits: The investing party has high returns on the saving and bank accounts whereas there is
high protection from the government for taxation and other purpose (Duarte et al., 2012). For the
restaurant, it has advantage in the form of lower interest rate in most of the cases, easy
availability and no strict formalities.
Drawbacks: The investor faces the issue of default borrowers and so that credit is at high risk.
The restaurant has main limitation in the form of irregular installments and sudden notice of
repay if there is no formal process to owe the money.
Angel and venture finance
The individual investors are called angel investors whereas the group of professionals is termed
as venture finance. The organization can get the finance if there is potential to achieve the
growth but there is also high risk for investors to recover the amount.
Benefits: The organization can get expertise and guidance from the professionals because they
also have to recover their amount. The venture funding also connect the small businesses and
resources to achieve rapid growth (Ding et al., 2014).
Same time, it also creates marketing values and enable the business to understand the opinions
and reaction of the public. Therefore, the organization can get finance away from the
conventional investors and banks (Belleflamme et al., 2014).
Drawbacks: There is need to develop the interest of people to encourage them for investment
whereas it shows that the business is not financially capable to accomplish a particular task.
There is loss of reputation as well as practices if required amount is not collected. Most of the
projects are also not suitable for crowd funding.
Peer-to-peer lending
It is the practice to map individual lending party to the borrowing party. The borrower might a
person or a business. It means that there is direct lending of the money to achieve high
profitability.
Benefits: The investing party has high returns on the saving and bank accounts whereas there is
high protection from the government for taxation and other purpose (Duarte et al., 2012). For the
restaurant, it has advantage in the form of lower interest rate in most of the cases, easy
availability and no strict formalities.
Drawbacks: The investor faces the issue of default borrowers and so that credit is at high risk.
The restaurant has main limitation in the form of irregular installments and sudden notice of
repay if there is no formal process to owe the money.
Angel and venture finance
The individual investors are called angel investors whereas the group of professionals is termed
as venture finance. The organization can get the finance if there is potential to achieve the
growth but there is also high risk for investors to recover the amount.
Benefits: The organization can get expertise and guidance from the professionals because they
also have to recover their amount. The venture funding also connect the small businesses and
resources to achieve rapid growth (Ding et al., 2014).
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