Strategic Growth Plan for Tops Pizza: Growth Strategy Report

This report outlines a strategic growth plan for Tops Pizza, a UK-based pizza chain. The analysis begins by summarizing the company's strategic position using the BCG matrix, which places Tops Pizza in the 'Question Marks' category, and a SWOT analysis, highlighting its strengths and areas for improvement. A critical analysis of the UK pizza industry follows, including PEST and Porter's Five Forces analyses, revealing a competitive market with growth potential. The core of the report presents a comprehensive growth strategy for Tops Pizza, detailing plans for the next 12 months, 1-3 years, and 3-5 years, emphasizing innovation, technology adoption, and supply chain improvements. The report also addresses issues involved in managing growth, such as funding, structural changes, and IT systems. Ultimately, the strategic growth plan aims to enhance Tops Pizza's market share and competitiveness in the thriving UK pizza industry. Desklib provides access to similar reports and study tools for students.

Running head: STRATEGIC GROWTH PLAN
Strategic Growth Plan for an existing Small/ Medium sized business
[Tops Pizza]
Name of the student:
Name of the university:
Author note:

1STRATEGIC GROWTH PLAN
Executive summary
This study is aimed at designing a growth strategy for the business. The business chosen for this
purpose is a pizza making company “Tops Pizza” based in the United Kingdom. Tops Pizza is
different to other pizza making companies in identifying and implementing innovative ideas.
They have been doing well with creative ideas; however, by following a designed growth plan
they can do even better than they are currently doing. Therefore, a comprehensive growth
strategy for the company is being discussed in three stages. These are growth in the first 12
months, in between 1 to 3 years and after 3 years. At the end of this report it is being concluded
that the growth plan can be a profitable move. It is because of the current strategic direction of
Tops Pizza, which helps them taking advantage from opportunities in the market.

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Table of Contents
Introduction......................................................................................................................................4
Section 1: A summary of the strategic position of the organisation................................................4
Boston Consulting Group (BCG) Matrix....................................................................................4
SWOT analysis............................................................................................................................6
Future business plans...................................................................................................................6
Section 2: A critical analysis of the industry/ sector/ market & competitive positioning...............6
Overview and trends in the Industry................................................................................................6
PEST analysis..............................................................................................................................7
Porter’s Five Forces.....................................................................................................................8
Competitive Positioning..............................................................................................................9
Section 3: A comprehensive growth strategy for the business......................................................11
For the next 12 months..............................................................................................................16
For years 1 to 3..........................................................................................................................18
For years 3 to 5..........................................................................................................................19
Section 4: The different issues involved in managing the growth; sources of funds, structural
changes, new staff/ skills, new IT systems/ technology................................................................20
Conclusion.....................................................................................................................................22
References......................................................................................................................................24
Appendices....................................................................................................................................28

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Appendix 1: Reflection..............................................................................................................28
Appendix 2: SWOT analysis.....................................................................................................28
Appendix 3: PEST analysis.......................................................................................................29
Appendix 4: Competitor analysis table......................................................................................30

4STRATEGIC GROWTH PLAN
Introduction
This report is aimed at designing a strategic growth plan for a chosen company “Tops
Pizza”. It is the United Kingdom based takeaway pizza chain. The first store was opened for
serving the consumers in 1989. Tops Pizza that has 41 stores around the south west is
increasingly becoming one of the fastest growing chain of pizza stores in the United Kingdom.
Factors that helped to expand to so many locations is their expertise in delivering delicious pizza
and offering great service. Tops Pizza occupy a small yet very significant position in the United
Kingdom food industry. The significance is due to its capability to serve and satisfy customers
with delicious pizza. They are actually serving the needs of consumers especially millennials
who prefer having pizza in offices, at homes and other places. Strategic growth plan is an
essential business strategy adopted to increase market shares either by operating in the same
market or by entering to a new (Ward 2016). The purpose is to create a strategic growth plan for
Tops Pizza to provide some ways to do even better than the current.
Section 1: A summary of the strategic position of the organisation
Boston Consulting Group (BCG) Matrix
Tops Pizza’s main activities are included as under;
 Operating stores in different parts of the United Kingdom
 Domestic supply chain

5STRATEGIC GROWTH PLAN
According to the BCG matrix, Tops Pizza is at the ‘Question Marks’ position. This
means that Tops Pizza is gaining significant market share in one of the fastest-growing
industries. The profit margin could be lower; however, investment will always be needed to
further the product and service level of the different pizza store brands. With 41 stores in the
United Kingdom, it is in better position to leverage its business. It becomes easier to leverage the
business with a robust growth plan. Notably, an effective use of resources have helped the
company to survive over years and constantly add new stores to its business (Topspizza.co.uk
2019).
The pizza delivery and takeaway industry has grown at 5% every year from 2014 to 2019
(Ibisworld.co.uk 2019). The revenue stood at £3bn for a fiscal year 2018-19 (Ibisworld.co.uk
2019). 47,276 people are currently employed in this industry (Ibisworld.co.uk 2019). The
number of businesses in this sector is close to 3,050 (Ibisworld.co.uk 2019). The list of top
performing companies include Domino’s Pizza Group Ltd, Pizza Hut (UK) Limited and Papa
John’s Pizza (Ibisworld.co.uk 2019). These pieces of information suggest that the UK pizza
industry is largely dominated by majorly reputed companies in the sector. Due to the market
being dominated by major players Tops Pizza should focus on innovative ideas to further their
business.
The UK Fast-Food Restaurants Industry is booming. The revenue generated by the
industry is £19.1bn till the end of 2018 (Ibisworld.uk 2019). The number of people employed in
this industry is equal to 390,024 (Ibisworld.uk 2019). The number of companies in this industry
is close to 42,154 (Ibisworld.uk 2019). The average annual growth has remained 1.9% from 2014
to 2018 (Ibisworld.uk 2019).

6STRATEGIC GROWTH PLAN
Tops Pizza should consider opening new stores and adding few attractions to it. This
means they should work upon providing seating space to customers, which most of the
companies like McDonald also does not do in many of its stores. This all can be done by
following an extensive growth plan. This paper serves exactly the same purpose.
SWOT analysis
(See Appendices section)
The analysis suggests that Tops Pizza has potentials to do much better than the current.
The ability to offer pizza quicker and at low-cost is a unique selling point for Tops Pizza.
However, few areas need to be filled up with effective strategies. These are supply chain
management, offering more number of eateries over a span of five years, heath conscious
eatables, and avoiding competition from direct and indirect competitors rather creating a separate
identity by following with trending facts.
Future business plans
The assumed business plans for Tops Pizza is as under;
 Opening new stores with few stores possibly offering seating space by means of
franchising the business
 Solidifying the presence over a span of five years
 Increasing the number of stores if things turn well for the company
Section 2: A critical analysis of the industry/ sector/ market & competitive positioning
Overview and trends in the Industry

7STRATEGIC GROWTH PLAN
Takeaway pizza and delivery industry is booming in the UK. Consumers are increasingly
having pizza in their day-to-day living. Consumers in UK spend around £19.1bn on the pizza
industry (Ibisworld.uk 2019). Takeout Pizza is the highest contributor to this figure.
Pizza chains contribute maximum to the entire sales of UK Pizza. Pizza chains contribute
to more than half of the entire UK Pizza restaurant sales. The rest of the sales are accounted by
independent restaurants. The United Kingdom is home to some of the world’s leading pizza
making companies. This includes but not limited to Pizza Hut, Papa John's and Domino's Pizza.
Pizza Hut is operated by Yum Brands. The company also operates some of the popularly known
fast-food chains like Taco Bell and KFC.
The likes of Pizza Ranch and Papa Murphy's are preferred more over the giant Pizza
chains like Pizza Hut, Dominos’ Pizza and Papa Johns’. This is because Pizza Ranch and Papa
Murphy's are cheaper than these giants. There is tough competition between pizza making
companies in the United Kingdom.
From the piece of information furnished as in the above three paragraphs it can be said
that the pizza making business is booming in the United Kingdom. People just love to have
pizza. It also serves their short-term purpose, which is to get something to have breakfast or
lunch while being in offices or other suitable places. Additionally, it consumes less time to have
a pizza, which is time-saving and fits with the busy office schedules. To attain and retain the
competitive advantage it is important to identify, analyse and implement latest and emerging
technologies. Such technologies will speed the pizza making process and thereby the order
delivery time would also decrease. Hence, customer satisfaction rate would also increase.
PEST analysis

8STRATEGIC GROWTH PLAN
(See Appendices section)
Based on the PEST analysis of pizza takeaway industry in the United Kingdom, it can be
said that there are good prospects for Tops Pizza. The use of emerging technologies can help to
improve the pizza making process, improve the customer satisfaction rate and of course the sales.
However, there are a few challenges such as tax policy, employment laws, growing awareness on
environmental pollution, increase in inflation rate and changing eating habits.
Porter’s Five Forces
The five forces are as mentioned below (Pilcher 2017):
Bargaining Power of Suppliers (high): It is high as it does not have its own supplier system. It
is also due to an incremented dependency on suppliers.
Bargaining Power of Customers (high): Foods are available at affordable prices. Additionally,
there are wide number of options to buy from.
Competitive Rivalry within an industry (high): Competition is very high with Domino’s and
Pizza Hut leading the market. List of competitors include but not limited to Papa John’s and
Little Caesars.
Threat of New Entrants (high): Opening pizza stores is not very expensive.
Threat of Substitute Product (high): There are so many substitute products of pizza like
chicken, hamburger and so forth.
The piece of information furnished as above show that the food industry has still not
reached its maturity stage. Indeed, it has the growth prospects. However, Tops Pizza can struggle
to earn additional market shares considering that it does not have an impressive supply chain

9STRATEGIC GROWTH PLAN
operations as compared to the industry’s leaders. It is, therefore, more recommended to follow a
robust growth plan that covers an improvement in the supply chain operations and also enhances
the in-store experience for customers.
Competitive Positioning
Tops Pizza has not changed much from the day it came to the existence in regards to
strategic direction. Historically they have maintained a very simple business process. The base of
which was several factors. It follows a cost-leadership approach to remain affordable to
customers. Simple menu is one of those. Tops Pizza was never focused on offering a wide range
of foods to customers. Rather, they remained focused on offering tasty pizza. Apart from
offering quality pizza to customers, delivery process had also remained one of the essentials to
the business of the company. They remained constantly focused on improving the delivery
system (Davis et al. 2018).
The current strategic direction remains more or less the same apart from development in
the delivery and pizza making process. They will together take care of the food preparation
process. Hence, the time span required to cook foods will decrease and the quality will improve
(Davis et al. 2018). In addition, the company is planning to expand its expertise in IT solutions
while keeping the pizza making as its core operations.
Competitor Analysis
(Refer to Appendix 4 for Competitive Analysis Table)
Goals: -

10STRATEGIC GROWTH PLAN
Tops Pizza: Tops Pizza is focused on increasing its market shares. It is quite justifiable too
considering that it is yet to challenge the competition being posed form Pizza Hut and Domino’s
Pizza. The market shares are nowhere in comparison to Pizza Hut, Domino’s Pizza, Papa john’s
and others. Tops Pizza is concerned with price competitiveness. This is perhaps the one way
using which a robust performance can be produced. Customers should have reasons to purchase
pizza from pizza making brands (Fassam and Dani 2017). This is exactly one of the strategies to
attract consumers. Tops Pizza is able to maintain a healthy customer base with the quality of
pizza offered to customers. Tops Pizza is also focused on providing ultimate delivery vehicle.
Tops Pizza is also intended to attain and maintain an increased customer satisfaction rate. This is
also the reason why Tops Pizza has been so innovative with its pizza making techniques and
technological expertise. The use of locally sourced high-quality materials and application of
strategies for an effective supplier-relationship management are just indicating its innovative
expertise (Fassam and Dani 2017).
Papa John’s: On the other hand, Papa John’s more or less has similar strategies as that of the
Tops Pizza but differs in few regards. Papa John’s is also focused on increasing its market shares
from since their inception to the food industry. The company is also focused on maintaining its
price competitiveness (Bhat, Reddy and Mandanna 2018). It is more focused on increasing its
brand loyalty whereas Tops Pizza is in increasing customer satisfaction. Although both are
interdependent but still it shows that Tops Pizza knows exactly what areas to hit in order to
increase brand loyalty for the company.
Strategy: -
Tops Pizza: The Company offer quality pizza at the most competitive price. This is a factor of
competency that they possess (Barrows, Vieira Jr and DiPietro 2016).

11STRATEGIC GROWTH PLAN
Papa John’s: Papa John’s is more focused on using better ingredients to be able to offer better
pizza to consumers. This is indeed a better strategy and even superior to the one of Tops Pizza
that is concentrating on improving the delivery system. However, delivery system is an essential
part of pizza business. The delivery system must be controlled efficiently to be able to reach to
more consumers. People mostly order pizza at their offices, homes and other convenient places
(Barrows, Vieira Jr and DiPietro 2016). An effective delivery system would probably impact the
customer satisfaction rate.
Competitive advantage: -
Tops Pizza: Brand recognition is one of the competitive advantages to the company. They are
furthering it with their constant progress in technological developments. Managing human
capital is the other advantage the Tops Pizza has over many of its competitors (Hollenbeck and
Jamieson 2015).
Papa John’s: The Company follows a segmented pattern of operations. The company is able to
effectively separate its different business units. As a result of which there is less pressure on the
management team. The rate of productivity is also high. Papa John’s efficiently manages quality
control (Hollenbeck and Jamieson 2015). It does so with the help of professionals who are
skilled and well trained on the product of the company. Professionals are well equipped with
strategies to be used to be able to follow the business protocol.
Section 3: A comprehensive growth strategy for the business