Business Growth Strategies for Crocus Co. UK: A Comprehensive Analysis

This report analyzes the growth strategies for Crocus Co. UK, an online retailer specializing in plants and gardening supplies. The report delves into key considerations for evaluating growth opportunities, including PESTLE analysis and Porter's generic strategies, and then applies Ansoff's growth vector matrix to assess market penetration, product development, and diversification strategies. It explores various funding sources, such as bank loans and crowdfunding, along with their benefits and drawbacks. Furthermore, the report includes the design of a business plan incorporating financial information and strategic objectives, and it assesses exit or succession options for the small business. The report aims to provide a comprehensive overview of the planning process essential for Crocus Co. UK's expansion, particularly with the launch of online consultancy services, emphasizing the importance of strategic planning and financial management for sustained growth.

Planning for Growth

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Analysis of key considerations for evaluating growth opportunities and justify
considerations..............................................................................................................................1
P2 Evaluation of opportunities for growth applying Ansoff’s growth Vector Matrix................3
TASK 2............................................................................................................................................4
P3 Sources of funds available for businesses and discuss benefits and drawbacks....................4
TASK 3............................................................................................................................................6
P4 Design a business plan which includes financial information and strategic objectives.........6
TASK 4..........................................................................................................................................10
P5 Assess exit or succession options for a small business explaining the benefits and
drawbacks..................................................................................................................................10
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................13
.......................................................................................................................................................14

INTRODUCTION
Planning is one of the basic function which is required to be followed by managers to run
and expand business in effective and significant way. As these days competition is increasing
with rapid speed, so expansion of business is one of the essential component which has to be
considered. In case managers are not thinking to expand business, hen they will run out of race
and people does not recognise them (Barbour and Deakin, 2012). Growth can be done when
some new features are added to product and services. There is need of proper planning related to
expansion of business, sop this will fruitful for achieving targets. This report is based on Crocus.
Co. UK which deals in online retailing of plants and gardening. They also give bird house,
feeders, hedgehogs, etc. In this report there is discussion about key considerations for growth
prospects, sources of funds, business plan and exist and succession options.
TASK 1
P1 Analysis of key considerations for evaluating growth opportunities and justify considerations
Growth of business is one of the essential component which has to be considered by
managers. As there are many changes which are taking place in business environment, so it is

essential to come with approaches which are competent to it. Crocus. Co. UK deals in online
business of plants and gardening. There are any growth opportunities for Crocus. Co. UK which
is significant for making good image in market and providing satisfaction to customers.
As there is requirement of various resources through which business operations can be
performed in effective and efficient manner. Crocus. Co. UK has to work according to demand
of customers. As managers of Crocus. Co. UK are thinking to launch online consultancy services
regarding planting which helps to provide satisfaction to customers. So there is requirement of
proper planning which is effective for growth and actions are performed accordingly
(Brinckmann, Grichnik and Kapsa, 2010). Porter generic model is one of the best approach
which helps to know about capabilities, resources and core competencies of Crocus. Co. UK.
This is discussed in detail as under-
(Source: Porter's Generic Competitive Strategies, 2016)
Cost leadership- This is the approach which focus on costing lowest in the industry. This
can be possible when managers of Crocus. Co. UK use resources from optimal source and utilise
them in most effective and appropriate manner. When managers of Crocus. Co. UK collect
planting resources collectively through which economies of scale can be achieved.
Differentiation leadership- As there are some competencies which is unique in Crocus.
Co. UK as compared to others. It is essential to set price of that services premium such as
Crocus. Co. UK provides accessories for taking care of plants, etc. This provides edge over other
organisations.
Illustration 1: Porter's Generic
Competitive Strategies

Cost focus- This is the approaches which managers of Crocus. Co. UK use to deliver
goods at some specific price to certain customer. In this main objective is to reduce cost and
deliver goods.
Differentiation focus- As there are modifications taking place in demand of customers. So
in this case research and development department of Crocus. Co. UK has to analyse market and
come with services with is unique. As managers of Crocus. Co. UK is thinking to come with
online consultancy services, so in this their core competency and customer prefer to purchase
planting goods from them.
Out of the all the above discussed strategies, the most appropriate strategy for the
company will be differentiation. There are many substitutes of a single product in the market but
the need is to make the products different from others. So by differentiation the company can add
additional qualities in their products and can attract more number of customers which will help
in the growth and development of the company.
Apart from this it is essential to analyse external environment also. So satisfaction can be
provided to consumers (Burton, 2010). PESTLE analysis is best approach which helps managers
of Crocus. Co. UK to know what are opportunities present in external market.
Political- Political factor means interference of government. As trend of online business
is increased, so managers of Crocus. Co. UK has to work according to governmental policies.
This is effective for creating loyalty and trust related to brand among customers.
Economical- Finance is one of the essential component for organisation as well as
country. Through online business GDP of America is raising and currency exchange is also
improved (Chapin, 2012).
Social- Society is important component which help to grow and expand business. As
there is change in demand of plants and trees according to external factor, so this proves to be
growth opportunities for Crocus. Co. UK. Hence providing consultancy services for customers
are effective for growth of business.
Technological- Crocus. Co. UK deals in online retail business of plants, trees, etc. So it
is essential to know strategies which are effective for delivering products to customer as per set
time. In case of late deliver product may get damaged. In case of online consultancy services,
there must use of proper techniques through which customer and consultant can be connected
properly.

Legal- Legal factor provide growth aspects. When managers of Crocus. Co. UK work
according to set targets then this perform business operations in effective way.
Environmental- Environment means factors which may affects business operations due to
climatic changes. It is important to deliver goods with due care so changes does not affects
plants, tress, etc.
From the above discussion made on the impact of external environment on the working
of Crocus Company it is clear that the company is dealing good with the external factors
impacting upon it. However there is a need for the company to focus on following rules and
regulations made by the government so that their intervention in the working of the company
could be avoided.
P2 Evaluation of opportunities for growth applying Ansoff’s growth Vector Matrix
It is marketing planning model which helps company to identify its product and market
growth strategy. This matrix is used for understanding about risk associated with various
strategic options. Crocus. Co. UK is a small company which deals in selling their plants online
and now company wants their business (Christofakis and Papadaskalopoulos, 2011). Therefore,
firm must use Ansoff matrix to form growth and development strategies for expansion their
business operations.
There are four approaches of Ansoff vector matrix that are as follows:
 Market penetration: This strategy concentrate on selling existing product into the
current market. There is advantage of this strategy is that it is less risky as company
knows about the customer demand and also having knowledge of their competitors.
Market penetration will need more investment in new market research.
 Market development: In this strategy of Ansoff vector matrix, company must focus on
sell their existing products into new market. This is risky strategy compared to market
penetration. It is because organisation face some difficulty in analysing the new
marketplace which leads to increase the cost of the firm (Eddleston and et. al., 2013).
 Product development: It is the another type of Ansoff vector matrix which launches the
product in the existing market. Product development needs development of new
competencies and requires that company produce innovative or modified product that
offers to current market. This strategy is more suitable for a firm when they wants
product differentiation to remain more competitive and achieve the competitive

advantage over the edges. For successful product development company must
concentrate on various sectors such as analysis the customer needs & demand and also
emphasis on R & D and innovation.
 Diversification: This strategy of Ansoff vector matrix means introducing new product in
new marketplace. Diversification is very risky strategy it is because company going to
that market where they have less or no experience. Even firm do not know about the
customer demands and their competitors. There is benefit of this strategy is involves the
potential to achieve a foothold in an attractive business and also decrease in overall
business portfolio risk. In this strategy there is high risk that is compensated by chance of
high rate of returns (Grover, Bokalo and Greenway,2014).
All these are the growth strategies of Ansoff vector matrix that helpful for company to
develop growth strategies which provides the best approach for expansion of business. For
Crocus. Co. UK Diversification is the best suitable strategy as it want to expand their business
by adding new services to company. Crocus. Co. UK uses online platform to sell their plants and
now they also providing consultancy related to their plants. Diversification is considered as the
best suitable strategy for this company because the company is already having well established
brand image in the market and it will be easy for the company to attract new market and new
customers easily with the help of already established brand image and reputation.
TASK 2
P3 Sources of funds available for businesses and discuss benefits and drawbacks
As managers of Crocus. Co. UK are thinking to launch online consultancy services for
customer. This is beneficial for people who have fond of gardening and want to maintain good
and decorative gardens. Through consultancy queries of customer can be resolved and they get
more satisfaction. But to launch online consultancy there is requirement of some funds. As per
estimation there is requirement of £6000 for expansion of business. £2000 are raised through
internal sources such as retained earning, reserves, ploughing of profits, etc. Remaining amount
will raised through external sources. External sources used by Crocus. Co. UK are discussed as
under-
Finance plays an essential role in an organisations, as there are number of activities and
operations that are performed with the appropriate fund or capital. So, it is very essential for

Crocus. Co. UK to identify sources of finance for smoothing running of its business activities.
There are two type of sources to raise the fund i.e. internal and external sources (Hough and et.
al., 2010).
Internal :- Fund that can be generated from within the organisation are considered as internal
sources. It includes retained earning, sale of asset etc.
External :- Fund that can be raised from sources which are present outside the organisation such
as equity capital, preferred stock, debenture etc.
Major sources of finance that can be used by Crocus. Co. UK are as follows:
 Bank loan :-Bank loan refers to the fund which is taken up from bank over an agreement
of repayment in future with interest over the maturity period of loan. This repayment
amount is depend upon the size, and rate of interest charged by bank. Banks provide
loans to reputed and well established business and not to the start ups or new businesses.
Advantages :- Flexibility of payment, company can repay its loan either in instalments or in
single instalment after its maturity date.
Disadvantage :- Major disadvantage is that some bank charges pre payment loan penalty.
 Crowd Funding :- It refers to the pooling of small amount of money from large group of
investors for financing Company's project is known as crowdfunding (Keough, 2015).
Advantage :- this is fastest sources of raising fund which also provide an marketing platform for
company's product to get attention.
Disadvantage:- crowdfunding is most risky source in case company fails in its project so it have
negative impact over the reputation of organisation.
 Angel Financing :- Some investors invest fund in the company in order to achieve equity
position within the organisation, these investors are known as angel investors.
Advantages:- It is beneficial to company as it does required repayment in case of project failure.
Disadvantage :- Major drawback is that company will loss its control over its ownership and has
to share profit in business.

TASK 3
P4 Design a business plan which includes financial information and strategic objectives
Business plan is the tool which is prepared for futuristic actions. This is the technique
which is effective for making decisions and taking actions to achieve targets. Crocus. Co. UK
wants to launch online consultancy services (Li, Mobin and Keyser, 2016). Managers of Crocus.
Co. UK is making business plan for this.
Vision & Mission:
Vision: Vision of Crocus. Co. UK is to expand their business in animal husbandry sector also.
Mission: Mission of Crocus. Co. UK to open their outlet with varieties of temperature suitable
for plants and trees.
Objectives strategies costs:
Strategic objectives: As some people are fond of gardening, so Crocus. Co. UK is one
of the best association which is working to make strategies which are significant for market
growth. There are many changes which is significant for organisational growth. With online
consultancy service satisfaction among customers are more and hence they prefer to take
services from Crocus. Co. UK. There will increment of sales up to 15%. Crocus. Co. UK is able
to compete with other firms. This increment of sales will be achieved with in 6 months of
launching services. There objective is realistic and can be achieved with motivation of
employees. Increment of sales is achievable also. Increment of sales can be measured in terms
of profits also.
Financial information
While performing business through online sources, there is requirement of funds. As
there are many sources through which financial needs can be satisfied. There is involvement of
time as well as cost for raising funds. So it is essential to analyse market and then use funds.
Managers of Crocus. Co. UK are thinking to launch online services for customer. Some of the
funds are generated from internal sources while rest will raised from external sources such as
bank loan, crowd funding. Financial information must be correct and fair so it gives correct
information to stakeholders. Managers has to select sources which is significant and appropriate

for business expansion.
Total forecasted budget
Particular 31/12/15 (£) 31/12/16 (£) 31/12/17 (£)

Implementing
technology cost
150000 - -
Promotional expense 90000 87000 66000
Advertisement
Expense
65000 56200 54800
Catalogues 21000 48000 33000
Training charges 61500 88000 86500
Total Cost 387500 279200 240300
From the above discussed budget, it is clear that cost of implementing online services
charges are increasing. This shows that manager must use techniques through which they can
control cost. It is essential to know what can be done through which training is effective for
employees and able to operate online consultancy operations in appropriate way. While
launching new services, it is essential to promote it this can be done through use of pamphlets,
online means, etc. So it also involves cost of £90000, £87000, £66000 in respective years. As
managers of Crocus. Co. UK is expending much in promoting application so there is positive
impact on sales and profits.

Cash flow statement is accounting technique which shows accounting of cash assets. In
cash flow there are three major activities which are operating, investing and financial activities.
As per above discussed data, cash at beginning in 2015 was £22500. With various operations in
whole year cash at the end £102703. as per this there is increment in cash in 2015 was £79703.
In 2016, interest expense was £8502, this was shown in positive in operating activities. In
investing activities sales proceeds from property are £35565. This cash flow shows net cash at
the end after all operating, investing and financial activities. Estimated annual average of three
year's income is 72001.