Unit 42: Planning For Growth: Marianne Restaurant Growth Strategies

This report provides a comprehensive analysis of growth planning for Marianne, a small fine-dining restaurant in London. It begins by identifying key considerations for evaluating growth opportunities, including competitive advantages, resource management, and distinctive capabilities. The report then delves into strategic tools like Porter's Generic Strategies and PESTLE analysis to assess the external environment. The report also explores portfolio strategies, including the McKinsey and Boston Consulting Group matrices, and applies Ansoff's matrix to evaluate growth opportunities. The role and importance of SMEs in the UK economy are discussed, along with an assessment of potential funding sources. Finally, the report culminates in a business plan for growth, incorporating financial information and strategic objectives. The analysis covers various aspects of business development, providing a roadmap for sustainable growth and market positioning for the restaurant.

Unit 42. Planning For
Growth

Table of Contents
INTRODUCTION...........................................................................................................................1
Key Considerations for evaluating growth opportunities......................................................1
Portfolio Strategy ............................................................................................................................6
McKinsey matrix ...................................................................................................................6
Boston Consultancy Group matrix.........................................................................................8
Apply Ansoff's matrix to evaluate opportunities for growth .................................................9
1.4 Collaborations like mergers, acquisitions, joint ventures, strategic alliances, vertical
integration ............................................................................................................................11
Role and importance of SME in the UK economy and its growth ...............................................12
Assessment of potential source of funding and their benefits and drawbacks.....................12
Business plan for growth which includes financial information and strategic objectives. .........14
CONCLUSION..............................................................................................................................19
REFERENCES..............................................................................................................................20

INTRODUCTION
Growth planning refers to strategic business activity that enables the owners of business
to plan and then track the organic development in revenue. It permits businesses to be allocate
the limited resources towards centred efforts for the purpose of adopt changes in sector which
driven through digital disruption from competitors. Planning plays a necessary role in success
and development of the business activities. It aids in determination of factors and then develops
policies on the basis of market situations. This present report is based on the Marianne restaurant
and it is smallest fine dining restaurant in London. Its tasting menu includes vegetarian options
which provide lunch and dinner delicacies aplenty. Under this mention report will be discuss
about the main considerations for the purpose of evaluating the better growth opportunities in an
effective manner. Role and the importance of small size business in economy of United Kingdom
will be discussed.
Key Considerations for evaluating growth opportunities
Marianne is a small size restaurant that sells different kinds of food items in London,
United Kingdom. The main aim of this restaurant is to expand its business operations with the
help of innovation and develop products by considering the needs and preferences of people.
Competitive advantage as foundation of Growth
It is important for every organisation for getting success by analysing and studying the
market condition and its internal/external environments in an effective manner. Nowadays in
this competitive world it is very difficult to provide effective and efficient services to the
customers. In order to gain competitive advantage Marianne should provide good quality food
with better services according to the customers need and wants. The foundation of any SME is
important to plan for a competitive advantage in market so that the Marraine restaurant can
attract a lot of customers. There are sufficient resources available for this restaurant and it is
essential for this to utilise these resources in an effective way.
Resources, Competencies and Distinctive Capabilities are three major areas on which
SME's can work for improving their profitability and efficiency in market. SME's have to
develop good reputation in market and thus they have to work on these three concepts for
managing business activities and operations.
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Resources
In a business there is requirement of assets or resources which are used for doing
operations of the company. The assets that a company has are known as resources and every
organisation requires useful resources for accomplishing different operations of business. There
are basically two types of resources present in an organisation. These are internal resources and
external resources. An internal resource is defined as those resources which are created within
the organisation and on the other hand external resources are those resources which are present
outside the company. The resources generated in the company are organization-specific. If there
are not enough resources in the organisation then these are taken from suppliers present in
market. The resources which are present externally are organization-addressable. Moreover
resources are also divided into two categories i.e. specific or non specific. In context of chosen
SME i.e. Marriane Restaurant resources like raw material, machines, skilled staff, equipments,
etc. The main resource available with Marriane restaurant is it's creative architecture. This
restaurant provides a good ambience and light music to customers so that they can come and chill
there. Customer value addition is an important concept on which the managers of Marriane
restaurant works. On the other hand, Marriane restaurant also requires non specific resources
which are not that much specific and they do not much value to the company but then also they
are important. Resources like human resource, final resource and physical resource are a part of
tangible and intangible resources. Marriane restaurant hires skilled and talented workers so that
they can increase the level of satisfaction among customers. Marriane restaurant requires to
improve following resources for increasing it's market share.
Technological resources – A small scale restaurant should use technological
advancement in it's organisation for improving the performance of the company. These includes
latest equipments and techniques must be used in organisations.
Intellectual resources – This is defined as the valued employees of the company who have
good knowledge and skills. Employees who are skilled will help in making effective decisions
for improving business condition.
Competencies
A competitive advantage is important for an organisation as this will help in competing
with other organisations in market. In context of Marriane restaurant it is important for this
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organisation to provide quality food to customers for attracting more number of people. A strong
competitive advantage is important as this will help the restaurant to build good will in market.
Distinctive Capabilities
The distinctive capabilities are defined as those resources that are critical for competitive
advancement. Marriane restaurant can build distinctive capabilities by organisational
architecture, organisational reputation and innovation. This restaurant should continuously
innovate and develop it's product for sustaining in marketplace. The most important aspect of a
small business organisation can be build by developing relationship between stakeholders and
organisation.
The competitive advantage is essential for every organisation as this helps in performing
better than other competitors. This helps an organisation for generating more value for company
and shareholders.
 Benefit: Marriane restaurant will be able to create a good image in market by providing
quality and tasty dishes to people.
 Target Market: The target market of Mariane restaurant are youngsters, adults.
 Competitors: The competitor of this restaurant is all restaurants of London so it should
have effective competitive advantage that it can sustain in market.
It is an attribute that permits a company to be outperforming its rivals. It is one of the
most favourable position a firm seeks to be more profitable as comparison to its rivals
(Abolhasani and et.al., 2016). In order to gain the competitive benefit, it is necessary form firm to
demonstrate the comparative value than competitors and also convey information to desired
target market. Forget the competitive benefit as foundation of growth, Marianne restaurant used
can look into Porter's Generic Strategy. This model is explains how the firm pursue competitive
benefit across selected market scope. This suggested the four different business strategies which
could be adopted to gain the competitive benefits. The different strategies are mention below:
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Illustration 1: Ansoff Matrix, 2019
Porter's Generic Model: This is a model that is used by businesses in gaining competition in
market. This was given by Michael Porter for giving companies an advantage to be successful in
market. The main four tactics by the user are given below-
Cost leadership: according to this strategy the products and services of the company are
sold at an affordable price. This helps in increasing the number of buyers and also increasing the
profits of the company.
Differentiation: This is another strategy in which organisations attract customers by
creating a new innovation and creative change in the product or service. This helps to provide a
different and unique product to customers so that they can appreciate the company for providing
such innovative products.
Focus: This is another tactics used by the companies and in this the main objective of
companies is to increase the number of customers of product and services of the company. The
company’s focused on providing products and services to people according to their needs and
demands.
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Cost focus: This includes price offered by the company for a product or service. The range
of price decided must be affordable by the consumers so that sales and profits of company will
increase.
Differentiation focus: It is another strategy that will assist company to provide quality
products and compete with other companies within market.
Marianne restaurant can make use of cost leadership strategy for gaining attention of
large number of people and influence them so that they can opt for their products.
Cost leadership- It consists organisation winning the market share through appealing cost
– conscious consumers (Ahmed,and Bramley, 2015). It can be attained through having low costs
in target market segment. Through using this strategy, Marianne restaurant can target the
audience. Under this, cost of the products is low with high quality in order to attract more
consumers.
Differentiation leadership- Under this, differentiate the services or products in some
manner to compete in successful manner. The foods items and services are offered through
Marianne restaurant is unique that aids in attract more customers. With the help of this strategy,
restaurant can develop some different and unique as compare to other rivals.
Cost focus- In this, company seeks to low- cost benefit in one or small number of the
market segments. Through implementation this strategy, company can analyse market and needs
of consumers in an effective manner. The firm will prepare food items at high quality and
provide at reasonable cost.
Differentiation focus- It is related to development of service that give unique attributes
which are valued through consumers and perceive better than other competitors products. The
Marianne restaurant prepare the menu through analysing the demand and preferences of the
target market.
PESTLE Analysis
It refers to framework that is mainly used to examine as well as monitor macro-
environmental factors which may have to be profound effect on performance of business. This
tool is mainly used when beginning of new business ore enter in to foreign market
(Beatley,2014). The PESTLE analysis is helpful for Marianne restaurant to understand the
market growth, business position etc. PESTLE Analysis for Marianne restaurant mention below:
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Political factors- It is related with the degree that government intervened in an economy.
It consists political stability, government policy, tax policy, environmental law etc. If Marianne
restaurant wants to expand its business in other market then it needs to determine the government
policies, barriers, rules etc. It will aids in determination if business and grab better opportunities
for evaluation of the political factors.
Economical factors- It develops the significant affect on how company does business and
how profitable it is. The different factors consists interest rates, inflation, economic development
etc. To perform business operations in other countries, there is a need to restaurant to analyse
buying power of consumers for gaining high profitability. It aids in designing the effective
strategies on the basis of economic rate.
Social factors- This factor represents demographic norms, characteristics, values and
customers of population which company operates. It consists population trends like age
distribution, career attitudes etc. For expand the business through Marianne restaurant, there is
need to analyse current market trends and customer preferences. On the other hand, restaurant
can do some innovative things in its menu as well as services in an effective manner.
Portfolio Strategy
McKinsey matrix
The McKinsey matrix is defined as a strategy tool uses for systematic approach for the
business enterprises for increasing the investment in business. There are basically nine parts
given in this matrix that are discussed below. This kind of analytical tool can be looked into by
Marianne restaurant. This kind of tool will help Marianne restaurant to be able to determine in
advance if the market is attractive to enter or not. For this, a number of factors of the restaurant
can be looked into such as :
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Moreover, from the brief explanation below it is evident that this kind of matrix will help
Marianne restaurant to understand and clearly dine who the customers are and what are its
products or services (PMCs). Also, it looks at the attractiveness of the market which is equally
important.
Industry attractiveness - This refers to the level of attraction of Marianne restaurant and
estimating the time that is required for being successful in the industry. This includes analysing
the industry attractiveness by knowing long run growth rate of the industry, size of the industry
and structure of the industry.
Competitive strength of a business on product – this reflects the competency of
Marianne in market and it helps to make a good judgement regarding completion with its rivals
will be successfull or not.
Business unit strength- this involves various concepts of a business including market
share, brand equity, distribution and supply, production capacity and profit margins which are
related to competitors.
Plotting the information – after analysing various concepts mentioned above the
organisation can use this matrix for representing the market share of the company.
Strategic implications – this includes three recommendations for resource allocation that
includes grows, hold and harvest. This matrix states that business grow in attractive industries
and in the other hand the business is not successful in average industries and at last businesses
should be stopped in unattractive industries. The SME used in this report is Marriane restaurant
which is a food restaurant situated in London. This restaurant is having a very attractive
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infrastructure that serves quality food and cuisine to people of London. The entrepreneur of this
restaurant wants to grow it's business by adding new attractive dishes in it's menu.
Boston Consultancy Group matrix
This is a planning tool used by businesses or corporates to analyse the brand portfolio of
the firm and market share of the products offered by a company. This is a framework that was
created by Boston consulting group for evaluating the strategic position of business brand
portfolio. There are four quadrants of the BCG matrix and they are question mark, star, cow and
dog. Marianne restaurant can look into this matrix to analyse its brand portiflio.
Relative market share – this indicates that the market share will increase the cash returns
will also increase. When a firm produces more products then there are higher economies of scale.
In context of Marriane restaurant, the relative market share can be increased by adding more
food items, cuisines in menu of the restaurant.
Market growth rate- this means that a higher market growth determines good earnings
and profits of the business. The dour parts of this quadrant are given below-
Dogs this reflects low market share when compared to the competitors. These products are not
profitable while generating low or negative market cash returns. This is a low profit product of
the company. Marraine restaurant must stop selling those products which are not able to generate
profit for the restaurant.
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Cash Cows- this is the most profitable brand and it is known as milky as profits. This is
those products which earns a great profit for the company. The corporates should not invest in
cash cows for growth as they are able to make profits at a regular base. Marriane restaurant must
invest money in product which are cow products i.e. they are making money for the restaurant.
Basically meal combos and snacks make a lot of money to this restaurant.
Stars - These products are those which are operated at high grow industries these are cash
generators and cash users these products can get investment by the company for making more
money in business. When this restaurant will grow in market then it wil be having a good
reputation in marketplace at that time, there are some products of this restaurant which are
marked as cash generators.
Question Mark - these are those brands which are much closer to an end. Such products
can vanish from market at any time. This has no potential to get success in market. Some food
items of this restaurant are those which are not making money and they are causing loss to the
company. So production of these products should be stopped by Marriane restaurant.
Apply Ansoff's matrix to evaluate opportunities for growth
Ansoff matrix refers to the strategic framework that helps in estimating the feasibility of
growth and opportunity of business. This framework is helpful for gaining competitive advantage
in market. In context of Marianne restaurant the Ansoff matrix is given below-
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 Market penetration: This strategy states that business can improve the condition of
business by marketing a product or service in the existing market. This will help
restaurant in increasing profits and sales.
 Market development: This strategy states that business can is able to grow and develop
by selling products and services in a new market. In the market development method the
product is introduced in a new market and this is a risky job for a small business to launch
new product of a small business.
 Product development: This strategy states that businesses are suggested to grow faster by
launching a new product in the existing marketplace. In this kind of strategy the business
has opportunity to make product successful in a new market.
 Diversification: According to this, business organisation is suggested to introduce new
product in new market place.
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