Ella's Kitchen: Business Plan, Growth, and Funding Report

This report provides a comprehensive analysis of Ella's Kitchen, a UK-based company specializing in organic and nutritional baby food products. The report examines the key considerations for evaluating the company's growth, including the use of Porter's Five Forces to assess competitive advantages. It explores various growth opportunities using the Ansoff matrix, such as market penetration, market development, product development, and diversification. Furthermore, the report delves into potential funding sources available to Ella's Kitchen, including business loans, crowdfunding, bootstrapping, peer-to-peer lending, and angel investors, outlining their respective benefits and limitations. A business plan overview is also included, highlighting strategic intent. Finally, the report discusses succession options, presenting advantages and disadvantages for the baby food product organization.

PLANNING FOR
GROWTH

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Key considerations for evaluating growth of Ella's Kitchen..................................................1
P2 Opportunities for growth for Ella's Kitchen...........................................................................2
TASK 2............................................................................................................................................4
P3 Potential sources of funds available for Ella's Kitchen and its benefits and limitation..........4
TASK 3............................................................................................................................................7
P4 Business plan of Ella’s Kitchen..............................................................................................7
TASK 4............................................................................................................................................9
P5 Succession Options for Ella's Kitchen and its benefits and drawbacks..................................9
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Planning for growth plays a vital role in enhancing business operations. It is important for
the organisation to plan functions according to determined goals and objectives (Miller, Hauer
and Werner, 2015). The report will outline new products and services of Ella's kitchen, the small
enterprise of UK offering organic and nutritional baby food products in order to attain
competitive advantage. Further, it will evaluate growth options by using Ansoff matrix which
will assist the firm in expanding networks. Moreover, it will analyze the business plan used by
entity to identify its financial information, objectives and strategies. Besides, the report will
outline succession option and its advantages and disadvantages for the baby food product
organisation. Thus, it will discuss the potential sources of funds which will the assist the
enterprise in its growth and development.
TASK 1
P1 Key considerations for evaluating growth of Ella's Kitchen
Growth opportunities act as tonic for the small enterprises as it assist the firm in attaining
competitive advantage (Leigh and Blakely, 2016). The products and services for Ella's kitchen
are innovative and have the advantage to become market leader as it provides organic and
nutritional baby food products over which it has various profitable opportunities. It is important
for the business to grab all the possible opportunity which can help in its growth and
development. Moreover, the competitive advantage and growth opportunities for small enterprise
is analyzed by implementing the use of PORTER five forces. This model is the beast strategy
used by the organisation to analyses the increasing competitive and powers of key stake holders
such as, Suppliers and consumers. The Porter's Five forces model of Ella's kitchen is as follows:
Bargaining Power of Suppliers: The power of supplies for the company is moderate, This
comprises domestic, national and international suppliers are wholesalers due to which the
company has various options of switching (Ward, 2016). Besides, the organic food market chain
is spreaded all over the country due to which suppliers also have various options to switch their
choices according to their profitability and power.
Threats of Substitutes: In food market there are various substitutes available but the
kitchen holds the advantage over this as there are limited Number of companies selling organic
baby food products (Cummings and Worley, 2014). Further, switching cost has a strong force as
there are limited firm offering organic food products to the buyers. However, in contrary the
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availability of low cost substitute’s impacts the growth of Ella's Kitchen as buyers are price
sensitive and the discrimination allows them to switch for substitutes.
Threat of New Entrant: It has moderate impacts on growth opportunities as there is no
boundation on entry and exit but on the other hand the existence in food industry is difficult
because the consumers are very particular about their buying habits (Smither, Houston and
McIntire, 2016). Moreover, the baby food products hold advantage as the customers prefer
healthy and nutritional diet for infants and children's.
Bargaining Power of Buyers: The buyers are price sensitive, therefore low switching cost
over products has a strong force which can limit the growth opportunities of organisation
(Mowday, Porter and Steers, 2013). In this the company focuses on providing high quality of
information and food products in order to decrease the bargaining power of buyers. Further, the
consumers are, main disadvantage for the firm is that the customers buys products in limited
quantity which increase the production cost of the business.
Industry Rivalry: Threat from competitors is very high in food industry. The already
existing and leading companies have strong consumer base and loyal buyers which sometimes
restrict the growth of Ella's Kitchen but making innovation in services is the best strategy used
by the enterprise to attain competitive advantage.
P2 Opportunities for growth for Ella's Kitchen
Grabbing a strong control over growth opportunities is the best strategy which assist the
business in growth and development (Coale and Hoover, 2015). Small enterprises has various
opportunities to grab like implementing the use of different technological advancement which
assist in increasing cost effectiveness and timely production of goods. Further, the company uses
Ans-off matrix to determine its growth opportunities which assist the management in analyzing
the need of innovation in existing products or is the firm need to launch new commodity in order
to expand its consumer base and market share. Ans-off Matrix for Ella's Kitchen is as follows:
Market Penetration: This is growth strategy step of the firm in which baby food product
organisation is focused on selling its already existing products to potential buyers (Greenhill,
Prizzon and Rogerson, 2016). In this, the management focused on selling existing products
without innovation to maximum number of consumers in order to increase market share. For this,
Ella's Kitchen makes use of every possible promotional techniques like, advertising, sales
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promotion, competitive price setting organizing events etc. Apart from this, it specifically
focuses on potential consumers in order to introduce its loyalty schemes.
Market Development: It is the growth strategy used by the company to promote and sell
its already existing products in new market. The development assists the baby food product
company in increasing its consumer base and promoting its idea of healthy and nutritional
products for infants and children's (Lewis, Passmore and Cantore, 2016). This expansion of
market comprises new geographical boundaries, enhancement in product advertising and
packaging according to new market idea and tactics. Further, in this the entity sells its product on
every possible distribution channels that is online and offline.
Product Development: In this the company focuses on grabbing opportunities by
launching innovative products which can not be substituted easily. In accordance to product
development, the firm focuses on analyzing market demand by researching about the presents
trends and requirement of consumers for baby products (Ericksen, Berke and Dixon, 2017).
Further, in this the company focuses on innovating completely different product from market
keeping in mind customers needs. This is the best opportunities which assist the growth and
development of Ella;s Kitchen.
Diversification: In this the business focuses on diversifying its products. This growth
strategy is very risky for small enterprises but at the same time it is the most effective technique
of expanding operations (Newman and Newman, 2017). In this the firm focus on launching
completely different products in comparison to its basic idea which assist the organisation in
attaining competitive advantage.
Hence, according to Ansoff matrix it is demonstrated that the business is focusing on
adapting every possible strategy to grab growth opportunities. Apart from this, it is important for
the Ella's Kitchen to adapt and make use of digital technology like offering services at online and
offline platform (Phillips and Pittman, 2014). Further. Promoting products at every platform. For
instance social media plays a vital role in analyzing and adapting growth opportunities.
According to growing idea of Digital technology internet is the key to success as it assist the
enterprise in communicating with its customers and evaluating their requirement on regular
basis. The social media promotion is the best strategy For creating awareness about the healthy
and nutritional baby food products.
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TASK 2
P3 Potential sources of funds available for Ella's Kitchen and its benefits and limitation.
Investment decision plays a vital role in growth and development of business. For making
easy and effective business operations, it is important for the firm to use benificial funding
sources (Green and Haines, 2015). There are various sources available for business fund for
Ella's Kitchen but being and small enterprise there are various drawbacks and benefits of all
funding methods which are as follows:
Business Loan
In this the company can
business loan especially for
business. It is the creation of
debt in which the organization
is liable to pay interest as
specified by Bank at the time
of taking loan (Battilana,
Pache and Model, 2015).
Advantages Disadvantages
It is easy to get funds through
bank loans for business
purpose.
The interest rates keeps on
fluctuating which impacts the
cost efficiency of enterprise.
It is used by Ella's Kitchen as
it is the best method of funding
fixed assets of the firm.
This demands collateral
security which is sometimes
hard for the firm.
Crowd Funding
This the source which funds
the particular project or start-
up. In this the funds are
generated from numerous
individual who are interested
in contributing.
Advantages Disadvantages
In this company is able to get
feedback about their plan and
project. Further this helps in
setting improvement measures
(Armstrong and Taylor, 2014
).
In this the investors is updated
about all the specific details in
which sometimes it raises
question before the money is
being invested.
In accordance to this source
the company is able to get
more loyal consumers as the
If the business is not able to
make specific targeted amount
than the investors demand
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investment. their money back which
interrupts the protect
continuity.
Bootstrapping
It is the situation where an
entrepreneur embarked a
company effectively and
efficiently (Miller, Hauer and
Werner, 2015). An individual
said to be bootstrapping when
he or she started a company on
his or her personal finances.
Advantages Disadvantages
This will help the entrepreneur
in providing brief experience
about the structure of the
organization effectively and
efficiently.
The approach is not practical
as many a times business leads
a large amount of investment.
In regards of Ella’s Kitchen,
the approach will lead to
certain drawbacks and
limitations and also become a
barricade in growth and
development of organization.
The personal will be provided
with an idea about his personal
savings and investment
required for business.
It is time consuming and
entrepreneurs can easily lead
to huge debt and crises (Leigh
and Blakely, 2016). Thus, the
growth and development of the
organization can be affected.
In this entrepreneur does not
have to spend more time in
order to search for a company.
Peer to peer landing
Peer-to-peer (P2P) lending is a Advantages Disadvantages
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method of debt financing that
enables individuals to borrow
and lend money without the
use of an official financial
institution as an intermediary
(Ward, 2016).
It can provided higher returns
and benefits to the Ella’s
Kitchen effectively and
efficiently.
Money can be at risk. If the
money has been borrowed
from some unauthentic money
lender, then there can be
chances that the money of the
organisation can be at risk.
There are variety of lenders
available in the market from
whom money can be lend
There can be a thing as too
much choice. Because of the
wide range loan choices (some
of which are complicated) and
considerations, managing a
diverse portfolio can be time
consuming (Cummings and
Worley, 2014).
Angel investors
These are wealthy individuals
who invest their money in
emerging organisation as a
source of finance so that they
can earn effectively and
efficiently (Smither, Houston
and McIntire, 2016). This can
be effective source of finance
for Ella Kitchen.
Advantages Disadvantages
Business angels are free to
make investment and made
decision quickly. This can save
the time and effort of the
organisation and they can get
finance efficiently.
These are not suitable for
below £10,000 or more than
£500,000.
There is no need for collateral
that is personal assets as these
wealthy individuals invest
their amount on their personal
whim.
The disadvantage from taking
funds from these individuals
are they will ask for business
share and profit. Which
sometime become
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uncomfortable for
entreprenures.
TASK 3
P4 Business plan of Ella’s Kitchen
Strategic intent
Strategic intent refers to the purpose of the company and motives which dricves the
company to earn revenue and provide quality services (Mowday, Porter and Steers, 2013).
Strategic intent of organisation includes vision, mission, goals, objectives and plans on which the
management of the organisation determine their productivity. In this context, the strategic intent
of Ella’s Kitchen is provided below:
 Vision: The vision of Ella’s Kitchen is to be the leading organic baby food provider
across the United Kingdom. The company and management visualise that healthy and
organic food is to be provided to babies so that their growth and development can be
made effectively and efficiently.
 Mission: The mission of the organisation is to develop healthy eating habits that last a
lifetime by offering a range of tasty, natural and healthy certified USDA organic foods
for babies and kids, which are handy for moms and dads and fun for little ones (Coale
and Hoover, 2015).
 Business Objectives: The objective of the organisation is to provide and offer range of
products and services to their targeted customers so that growth and development of the
organisation can be take place effectively and efficiently.
Business plan Business description: Ella's Kitchen is a company that makes organic baby and toddler
food, sold in supermarkets internationally including UK, China, Norway, Sweden,
Finland, Belgium, Netherlands, Canada and the United States (Greenhill, Prizzon and
Rogerson, 2016). The current market share acquired by the Ella’s kitchen in United
Kingdom is 30% in baby food sector. Market Strategies: The market strategies of the organisation is to promote and advertise
their products and services effectively so that more and more customers can be attracted
effectively and efficiently. The segmented customers are mothers and parents of baby of
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age up to 5 years. The product strategy is to produce organic baby food that will aid in
growth and nourishment of baby efficiently. Competitive Analysis: The current market share acquired by the management of the
organisation is 30% in baby food products across United Kingdom. From the analysis it
was identified that the current competition is HIPP Organic baby Food Company (Lewis,
Passmore and Cantore, 2016). In order be in lead, the management of the organisation
focus on product differentiation strategy and cost strategy so that competitive advantage
can be gain effectively and efficiently. Stakeholders: The stakeholders of the organisation are classified into two parts which are
internal stakeholders and external stakeholders. Internal stakeholders included
employees, mangers, officers and directors and external shareholders includes, suppliers,
food raw material providers, government, customers, shareholders and investors. Product Design and development plan: Product Design and development plan of the
organisation includes the plan of products Ella’s Kitchen manufactures (Ericksen, Berke
and Dixon, 2017). The products produced by the organisation is the organic baby food
that aid in growth and development of the babies effectively and efficiently. The product
life cycle includes introductory, growth, maturity and decline. Operations and management plan: The operations and management plan is designed to
describe just how the business functions on a continuing basis. The operation and
management plan of Ella’s Kitchen highlights the logistics of the organisation such as
roles and responsibilities of employees and management team. This aid in improvement
of the performance of the management department and also provides a benchmark for
future success of the organisation. Financial factors: There are various sources of finance that aid in providing flow of cash
in the organisations effectively and efficiently (Newman and Newman, 2017). Further,
the management of the organisation always welcomes investors by innovating and
developing various schemes that will aid in providing welfare to both the investors and
the management of the organisation effectively and efficiently.
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TASK 4
P5 Succession Options for Ella's Kitchen and its benefits and drawbacks.
Succession or existing strategy is a comprehensive process where any factor that have
impact on owner are analysed. This process includes many issues like the family and
community of another along with their current and future planning regarding the
employees, its value market positioning etc., (Hravnak and et, al., 2017). exit planning
consist of the perception of owner its goals and objectives. It analysis the current resource
of firm so that necessary step can be taken in order to meet the objectives set by proprietor
Ways through which owner can exit business
Passing the business to a successor
In this the business is passed to immediate family member who is competent enough to
carry out the business and is also ready to take the challenge. In medium size firm it can
also be passed to manager who can handle the extra work (Akinbola, Abiola and Ajonbadi,
2014)
Advantages
 Even after exist owner is still left with some power to influence and maintain
business.
 It eliminates the option of any involvement of third party.
Disadvantages
 Any conflict in family may affect the business
 Emotional bonding makes it difficult to be unbiased and choose right candidate
who has potential.
Employee buyout or management transferring
Its most useful in the case where employee does not have any successor. In such
case the firm is passed down to key employee’s sometime management team or employees
come together so that they can buy or acquire some part of company. It’s one of the best
option for holder in maintaining the corporate culture of entity.
Advantages
 Provide business an sense of independence along with protecting its values and
legacy
 Work as reward for the management team for their hard work and constant support.
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Disadvantages
 Can have adverse effect on the moral and performance of firm if the whole process
fails.
 The terms and price get affected owner has to amends its price to accommodate the
management as they do not have much money to buy.
Third party involvement
There are many ways through which small business owner can sell their business such as
initial public offering, where on public stock exchange shares are sell to private business
holders. Privately equity or another business where they sell their business another
operating business in market.
Advantages
 There are many ways through which business can be sell.
 Quite effective in keeping the business alive if there is no succession plan
Disadvantages
 Business owner will have their own term and condition many time owners sell their
business are much lower cost which cost them quiet a money.
Causes for the failure of business
There are many factors that are involve in the failure of some of this are external control
which are beyond the control of firm and some of them are internal, External factors
include natural disaster, burglaries etc. along this political economical social and
technological factor can also have its impact on the firm. Many laws made by firm have
major influence on the working of firm in market. Same way any change in economic can
have its direct impact on the sales and profitability of firm. Internal factors include the
resource of firm such as their financial resources human or technical resource etc. To
overcome this issue its necessary of Ellas kitchen to have proper strategic and management
planning so that errors can be removed and efficiency can be brought in firm.
Exit route for successful business
Selling or floating one’s company is one of the of the best exit route in this owner or
holder of existing business as apart of flotation can sell their share. This help them in
finding investors who may are interested in their business, it’s a fast way through which
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