Deliveroo: Analysis of Growth Opportunities and Marketing Plan

This report presents a comprehensive analysis of Deliveroo's growth strategy, beginning with an introduction to the company and its objectives. It explores key considerations for evaluating growth opportunities through PESTLE analysis, assessing political, economic, social, technological, legal, and environmental factors impacting Deliveroo's business. The report then evaluates growth opportunities using the Ansoff matrix, recommending market development as the most suitable strategy for Deliveroo, particularly targeting students with a new service called Golden Bookery. Furthermore, the report assesses potential sources of funding, including personal savings, venture capital, angel investors, and business incubators, outlining the advantages and disadvantages of each. The report proposes a new marketing plan for Deliveroo, detailing its vision, mission, and target market. Finally, it examines exit or succession strategies suitable for small businesses. The report concludes with a summary of the findings and a list of references.

Planning for growth

Contents
INTRODUCTION.......................................................................................................................................3
TASK 1.......................................................................................................................................................3
P1 Analysis of key consideration for evaluating growth opportunities....................................................3
P2 Evaluation of growth opportunities....................................................................................................5
TASK 2.......................................................................................................................................................6
P3. Assessing the potential sources of funding available to business with benefits and drawbacks.........6
TASK 3.......................................................................................................................................................7
P4 Proposal of new marketing plan.........................................................................................................7
TASK 4.......................................................................................................................................................9
P5. Estimating the exit or succession with their pros and cons for small business...................................9
CONCLUSION.........................................................................................................................................11
REFERENCES..........................................................................................................................................11

INTRODUCTION
Planning for growth is a phenomenon of making a new marketing for expansion of
business of a company. In this report, new marketing plan for growth of online food delivery
company Deliveroo has been proposed. Deliveroo is a British online food aggregator firm
incorporated in 2013 by two entrepreneurs Will Shu and Greg Orlowski. The report covers the
main consideration for evaluation of opportunities of growth. Moreover the report also covers the
evaluation of opportunities for growth. The report includes the assessment of potential source of
finance for the company. The report also proposes a new marketing plan. Lastly the report covers
the assessment of exit options suitable for the small business enterprise (Deas, and et.al., 2016)
.
TASK 1
P1 Analysis of key consideration for evaluating growth opportunities
When a company decides to expands its business than it has to take into the account the
outer elements of environment that can influence the growth of new business. If conditions are
suitable for business than company should executes the new marketing plan. Otherwise firm
needs to do some modification in the plan (Myronycheva, and et.al., 2018
.

PESTLE Analysis
PESTLE analysis is a tool used for examining the conditions of external environment and
their impact on the growth of business. PESTLE stands for political, economical, social,
technological, legal and environmental factors. PESTLE analysis of United Kingdom is given
below:-
Political factors: Stability in the political environment is the plus point for the country.
UK has a constitutional monarchy in which monarch is the head of the state and Prime is head of
the nation. UK maintains good relations with United States of America. Although political
situations are good but Britain exit from European Union make international trading very
complicated. Government imposed strict immigration rules which discourage the skilled
employees to do work in UK. Visa formalities are become tougher after Britain left European
Union. Deliveroo is required to conduct training and development program for its employees )
(Pamuk, and et.al 2017)
.
Economical factors: UK is financially fulfilled country. Poverty is less in the country
and people have more than sufficient money. Inflation rate is moderate and corporate tax is also
reasonable. Nominal gross domestic product of the country is very high. However Britain is
facing a decline in number of employees because of Pound weakening and harsh economic
conditions. Importation cost of food grain increase due to which food become expensive for
customers. Citizens of the country are wealthy enough to bear the increment in price of food.
Pound will recover its value soon. Hence economical factors are good for Deliveroo.
Social factors: Multiple cultures exist in the United Kingdom. Population average is
increasing and growth rate of the population is also increasing. Company will have a big
marketplace for its business. Highly educated people are living in the country. Youth of the
nation are becoming health conscious. They prefer nutritious food over junk food. Therefore
Deliveroo is required to add diet food restaurant in the list (Qadri, And et.al, 2015)
.
Technological factors: UK is a home of people of highly innovative and technically
sound minds. Company can leverage the information technology to shine in the marketplace.
Technological advancement and innovation is a ongoing process in businesses. Companies are
consistently updating technologies in order to delight the customers. Almost every citizen has
access to internet and smart phone. Internet penetration encourages large number of customers
order food online. Innovation in the android application streamlined the operations of business.
Firm can easily interact with the workforce using customized android application. Hence
technological factors are favorable for the organization.

Legal factors: Government laws are strict towards the exploitation of labour.
Government enforced certain labour laws and employee legislation to safeguard the health of
workers. Employers cannot get work done from employees more than 48 hours in a week.
Employer is required to pay minimum living wage to the workers. Deliveroo is required to
adhere to the laws and legislations enforced by the government (Raparthi, 2015).
Environmental factors: Government is strictly regulates the use of vehicles. It has set
standard beyond which company cannot emit pollution. Deliveroo is already using pollution free
vehicles. Deliveroo also collaborates with European authorities in encouraging companies to
adopt environment friendly business operations.
P2 Evaluation of growth opportunities
Several growth opportunities are available for company to expand its business. Company
has to choose right growth strategy according to market attractiveness, suitability of macro
environment and available human, financial and technological resources. Assessment of
available growth opportunities is performed by marketer using Ansoff matrix (Wear, 2016).
Ansoff Matrix
It is a marketing technique used to for the assessment of available growth opportunities.
It is also product/market expansion grid. This model suggests four strategies according to the
market and product relevancy. The four strategies define by Ansoff matrix are market
penetration, product development, market development and diversification. The detail
description of all the four approaches of expansion are given below:-
Market Penetration: In this strategy, firms sell present product in present market with
more discount or intense promotional efforts in order to increase market share of the companies.
Market penetration strategy is performed by decreasing price of the product. Several sales
promotions techniques are used to fascinate large numbers of customers. Sales promotions
techniques are cash back, vouchers, freebies, coupon and many more. Acquisition of another
company of same industry is also a part of market penetration process (Miguez, Rezende, and
Veról, 2015).
Product Development: In this approach, company produce new product for existing
customer base. This strategy is useful when companies have enough resources to make a product
that prove to be the innovative solution of noticeable. Firms utilize this strategy after extensive
research on the customers as well as product.
Market Development: When a company sell current product to the new customer
segment is doing market development. This strategy is leverage when new marketplace is
extremely profitable. Company expects high revenue from the new marketplace. Companies
implement this strategy by supplying goods and services to new customer segment or by
entering to new domestic region or by expanding business overseas.

Diversification: In this, approach, companies enters into absolutely new industry. It sell
new product to new marketplace. This method of expansion is the most risky because lose focus
from its key product which can leads to destruction of legacy of main product for which
company is famous. Diversification is of two types that are related diversification and unrelated
diversification. Related diversification connotes development of new product with some kind of
link with the current commodity. On the contrary, unrelated diversification implies the selling of
new product with no association with current product (Lennon, 2015).
From the above mentioned growth opportunities, market development is most suitable for
Deliveroo. The new target market for Deliveroo will be students. Company will deliver books
from local book store to students or anyone interested in reading books. The name of the new
service will be Golden Bookery.
TASK 2
P3. Assessing the potential sources of funding available to business with benefits and drawbacks
Potential sources of business are referred as the process of funding investment methods to
serve it for capital generation which results in maximisation of revenue and profitability ratios.
These sources plays very essential role in development of business to remain stable in
competitive market while competing with its rivalries. Managers of Deliveroo Company
implement these potential to fully utilise these scarce resources in an effective manner to achieve
success. These are described as below:-
Funding from personal saving:- The business commence with investing personal saving to
generate capital as to maximise its profits and wealth which results in growth of business.
Managers of Deliveroo Company funds investment from personal saving with considering as
where there is risk there is a gain. Managers used to believe in investing high risk leads to
generate high return in future (Kinossian, 2018).
 Advantages:- This funding for potential growth of business as every investment in
business creates high return in future. Managers of Deliveroo Company is beneficial to
enhance net worth service of business which leads to survive in competitive market.
 Disadvantages:- Investing through personal saving is not much sufficient to generate
revenue as there are withdrawal limits in saving account, insurance limits, charge fees,
etc. Managers of Deliveroo Company faces major issue in investing for small business
with chances of less amount of interest as it is not certain high return will surely be
possible.
Venture capital:- This refers to collaborate two business in forming one organisation which are
able to share their liabilities and assets which increase their market share that results in
maximisation of profitability ratios. Managers of Deliveroo Company focus on their business

technologies which results in high growth of potential sources by acknowledging information of
softwares, automation, communication, etc.
 Advantages:- The business venturing capital for potential growth creates opportunity for
them to expand their business through possible bank loan. Managers of Deliveroo
Company are advantageous with this as its operating history considers high cost which
results in maximisation of profits (MacLachlan, and et. al., 2017).
 Disadvantages:- This considers huge amount of risk as lots of time is wasted in planning
and developing the strategic decisions. Managers of Deliveroo Company avail large
number of start-ups which does not always result in profits which create threats in growth
of business to achieve success.
Angel Investors:- These investors are considered as angel as they are highly professionals who
are retired and are capable to directly invest in organisation through their expertise. The investors
inform about the current situations and tend to finance early stage of business with their
investment from $25,000 to $100,000. The highest limit for angel investor to venture is
$1,000,000. Managers of Deliveroo Company funds business with this potential source to
survive in competitive market through exchanging money to these angel investors which
strategise to generate capital (Heydari, and Sullivan, 2018).
 Advantages:- Managers of Deliveroo Company are helpful with this funding as it is less
risky as compared to others and capital does not have to be paid again in failure of
business. This enlarge the growth of business to achieve its success for competing with
rivalries.
 Disadvantages:- Managers of Deliveroo Company as the total control of business is
transmitted to the angel investors which creates negative impacts on the position of
business for its growth.
Business Incubators:- This generally focus on different methods of technology adopted by
business which increase support at various stages of business. These business incubators leads to
develop economic growth through providing employment to labours, revitalisation, hosting and
sharing services. Managers of Deliveroo Company implement funding through potential source
of business incubator by sharing the premises, administrative, logical and technical resources to
generate capital (Eyvindson, and Kangas, 2016).
 Advantages:- Managers of Deliveroo Company are beneficial with business incubators
as they are essential for growth of business which save time and money in connecting
large network for venture capitalist and angel investors.
 Disadvantages:- Managers of Deliveroo Company are negatively impacted by business
incubators which increase competition and rigorous to compete.
From the above source of funding, the best source of finance will be venture capital because it
provides sufficient capital and expertise from rich investor.

TASK 3
P4 Proposal of new marketing plan
Company Overview
Dliveroo is a leading online food aggregator company operates in United Kingdom. It
was founded by Will Shu and Greg Orlowski in the year 2013. It takes away food from
restaurant and delivers to customers (Bergström, Lindegarth, and Lindegarth, 2015).
Vision
Vision of the company is to make customers life awesome by giving them most
convenience services.
Mission
Mission of the company is to become the market leader in home delivery of happieness to
customers.
Objectives
Company is targeting 15% increase in sales next year.
Company is aiming to 10% increase in market share consequent year.
Objective of the organization is to increase revenue by 20% within the tenure of two
years.
STP Model
It is a model that defines the profitable consumer category and way to communicate with
those customers. STP stands for Segmentation, Targeting and Positioning. STP model of
Deliveroo new service is given below:-
Segmentation: It connotes the division of entire population into categories according to
their shared characteristics. Segmentation is on the basis of demography, geography, socio
cultural and psycho graphic. Demographic segmentation is division of population on basis of
their age group, gender, life stage, marital status, education, occupation and income. Deliveroo
will choose demographic and psycho graphic segmentation.
Targeting: It refers to selection of right consumer category from the chosen
segmentation. Delivery will target students of middle and high income group in demographic
segmentation and people with hobby of reading in psycho graphic segmentation.

Positioning: It is the procedure of creating an image in the minds of target customers
towards the product. Deliveroo will position its new book delivery services as the most reliable
source of books that can deliver any books from any store in lower price than other e-commerce.
Financial information
Expenses 1st year 2nd year
Marketing expense 10000 20000
Initial Outlay 20000 30000
R&D Expense 40000 50000
Total 70000 100000
Marketing Mix
It is a marketing theory in which all the elements of a product are considered to deliver
product as right place in right place and with right promotional efforts. Marketing mix contains
four marketing components that are product, price, place, promotion. Marketing mix of Golden
Bookery is given below:-
Product: Deliveroo will deliver books from local book store to the students. It is highly
innovative and differentiated service. It will students petrol and time consume in purchasing
books (Pathiranage, Kantakumar, and Sundaramoorthy, 2018).
Price: Deliveroo will takes away and deliver books at competitive prices. Price will
lower than other e-commerce.
Place: Deliveroo will supply books to students from local book store. It provide door ton
delivery of books to book lovers.
Promotion: Company will promote its services through social media, mobile apps and
websites and refer to earn promotion mechanism.
Evaluation
Monitor and evaluation is a practice of measuring success of strategy. The two prominent
techniques of evaluation are kpi and benchmarking. Company will use kpi for evaluation
purpose. KPI stands for key performance indicators. Key performance of indicator for evaluation
will number of successful orders.
TASK 4
P5. Estimating the exit or succession with their pros and cons for small business
Small business refers as the privately owned business in which government cannot
impose their rules and regulations. Exit of small business is described as the dissolving or ending

of business in which the owner exits the business and the business remain stable at its position
with its declining condition. The exit strategies for business are explained with reference to
Deliveroo company for its pros and cons are as follows:-
Liquidation:- It is termed as the process of bringing business to an end by distributing its assets
to others for its insolvency. Managers of Deliveroo Company implement this to minimising their
liabilities through paying its obligations by distributing its assets (Hoch, 2017).
 Advantages:- It is essential for dissolving of business by debt writing off, restructuring
cost, investment funds can be focus on new entity, etc. Managers of Deliveroo Company
are advantageous for business growth through liquidation as it results in diminishing all
liabilities through distributing assets.
 Disadvantages:- Managers of Deliveroo Company are negatively impacted in the growth
of business as they are unstable in competitive market.
Sell business to managers:- The owners of business can also exit through by selling it to their
key persons as they are well known and can handle business with their specialised strategies
which generates its stability in market. Managers of Deliveroo Company adopt the business for
determining its ups and down as compared to its competitors which may results in profitability
ratios.
 Advantages:- Managers of Deliveroo Company are advantageous as they have sold their
business to the key person which may be capable to run business smoothly in future that
results in its growth.
 Disadvantages:- The managers of Deliveroo Company have negative impact to sell the
business as it can diminish the business from its current position.
Succession of small business is considered as the entity in which existing workers which
are retired, dead, etc., are to be filled with new leaders in order to take their place and accomplish
business to sustain in competitive market. These succession strategies are as described with
reference to Deliveroo company for its pros and cons that are as follows:-
Retirement:- The organisation retires the aged people which are not capable to increase
efficiency in order to achieve success by staffing the youngster to reduce time consumption with
specialised new skills. Managers of Deliveroo Company retires their existing employees as to
recruit new workers who are capable to meet the requirement of consumers with increasing
efficiency in order to achieve success for its growth.
 Advantages:- The managers of Deliveroo Company are beneficial through retirement as
new employees are entered and they have new skills which creates less time to capture
information.

 Disadvantages:- Managers of Deliveroo Company have drawbacks as they will take time
to learn and grasp and will require proper training and development skills which results in
high cost.
Death:- The business organise staffing as to fill the vacancy of death employee which reduce
specialisation through division of work. Managers of Deliveroo Company are beneficial with
staffing at place of dead employee as to improve the potential growth of business through
increasing efficiency.
 Advantages:- Managers of Deliveroo Company are positively affected as they are able to
recruit new employees to fill the vacancy and to improve efficiency that result in growth
of business.
 Disadvantages:- The managers of Deliveroo Company are negatively impacted as this
increase vacancy and increase time consumption for accomplishment of organisation
goals and objectives. This delay in achievement of success for growth of business.
From the above discussed exit options the best exit option for the company is selling business
to managers.
CONCLUSION
From the above assignment it has been concluded that macro environment of the country
is almost favourable for the company. The most appropriate strategy for Deliveroo will be
market development. The new target of the company will be students and book lovers. The most
appropriate source of funding is venture capitalist. Product will position as the most reliable
source of knowledge. The most appropriate exit option is selling business to manager.

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