Planning for Growth: A Business Report for Oak Cash & Carry, UK

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This report provides a comprehensive analysis of growth strategies for Oak Cash & Carry, a successful small-medium sized venture in the UK. It begins by identifying key considerations for evaluating growth opportunities, utilizing frameworks such as the Resource-Based View (VRIO) and BCG matrix to assess internal strengths and market positioning. The report then explores growth options using Ansoff's Growth Vector Matrix, focusing on market penetration, product development, and diversification strategies. A detailed business plan is developed, incorporating financial data and strategic objectives for scaling up the chosen venture, including securing investment. Finally, the report examines exit or succession options for the company, evaluating their benefits and drawbacks and offering critical recommendations. The report emphasizes the importance of market research, risk mitigation, and strategic planning for sustainable business growth.
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Planning for Growth
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Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
Key considerations for evaluating progress opportunities and justification based on these
within company context..............................................................................................................3
Chances for growth by applying Ansoff's growth vector matrix................................................7
Discussion based on options in context of business growth.......................................................9
TASK 2..........................................................................................................................................10
Development of business plan for business growth that includes financial data and strategic
objectives for scaling up chosen venture..................................................................................10
Detailed business plan for securing investment, setting out strategic aim, tactics and
frameworks................................................................................................................................14
Business plan that demonstrate understanding of formulation, application and achievement of
business objectives....................................................................................................................14
TASK 3..........................................................................................................................................14
Exit or succession options for a small venture..........................................................................14
Evaluation based on succession or exit options for company...................................................16
Critical evaluation based on options and appropriate course of action with clarified
suggestions................................................................................................................................17
CONCLUSION..............................................................................................................................17
REFERENCES..............................................................................................................................18
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INTRODUCTION
Planning for growth may define as important and useful strategic activity that makes a
company able to plan & measure actual growth in their profits and revenues. This act provides a
lot of benefits to small or large organizations, as it permit them to allocate its limited assets
toward an essential attempts to adapt to changes in specific sector driven by differentiate from
rivals & digital disruption. The current assignment will be based on Oak Cash & Carry, which
falls under list of the top 100 successful small-medium size ventures in the UK. It provides cash
& carry services to consumers such as caterers, off-licences and offices, with wide range of
goods in bulk. This study will explain important considerations in regard to growth by
evaluating progress opportunities and will also define chances for growth by applying Ansoff's
Growth vector matrix. It will describe the development of appropriate business plan in
organizational context that encompasses financial information & strategic objectives.
Furthermore, this report will clarify exist or succession options for chosen company and define
its benefits as well as drawbacks. It will explain evaluation based on exit or succession options
by comparing them with each other and then define valid suggestion based on overall
comparison.
TASK 1
Key considerations for evaluating progress opportunities and justification based on these within
company context
Oak cash & carry Ltd, is one of the smallest and successful grocery wholesalers in the
United Kingdom (Rantanen, Grant and Piotrowicz, 2017). It has successfully managed its small
venture within food wholesalers sector with 54 workers, who have made an effective
contribution in the context of generating revenue. Just like other small companies, Oak Cash &
Carry also want to grow its business and for that, they may consider growth opportunities in
market. In the world of business, there are different forms of tools, frameworks and models are
accessible that firm may use to evaluate and examine opportunities relate to excellent success
and progress of its small venture.
Resource based view-
This model is considered as managerial concept or framework that many companies
have been utilized to identify strategic resources that they may use to achieve sustainable
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competitive edge (Assensoh-Kodua, 2019). VRIO is an important part of this concept,
which apply in context of Oak cash & carry Ltd, it supports in process of considering
growth chances within sector.
Basis Value Rare Imitate Organization
Products Yes No Yes Yes
Innovative
technology
Yes Yes Yes No
Management Yes No Yes Yes
Brand image Yes Yes No Yes
Value-
The products that Oak Cash & Carry Ltd, offers to its consumers, innovative technology
which company used, brand image and management which it has, are all valuable for
organization. It may use all these things to gain competitive advantages and to become a market
leader. All these resources are valuable for the company as it helps to expand its venture across
the region, which may consider as growth opportunity.
Rare-
As described in the above table, innovation and brand image are included in the category
of rare things because many firms may not have these resources, which makes them unable to
grow venture. Oak Cash and Carry Ltd, has a good brand image in market and it also uses
innovative technology, which enables them to grow its business even better than other small
organizations that have operated in a similar sector.
Imitate-
Other firms may easily imitate products and advanced technologies, which they utilized
to gain profit and benefit in terms of business growth. It happens when chosen firm does not use
a trademark and other IP tools such as a patent.
Organization-
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Oak Cash and Carry Ltd, by using its wide range of product portfolio, effective
management structure and technologies, may gain the best growth opportunity which in return
increasing its profitability and productivity.
BCG matrix-
It is another tool that firm may use to consider growth opportunities within food
wholesalers industry (Mo and et.al., 2020). Boston consulting Group's product portfolio matrix is
especially design to help companies to develop long term strategic plan.
Stars-
Organic food items that Oak Cash and Carry Ltd, sell to its consumers are included in list
of star products because many people like to purchase organic food products from wholesalers or
retailers. Company needs to make huge investment in these items as it enable them to increase
more profits and generate revenue.
Question market-
Goods that has high growth markets with low share are encompasses in this category.
Canned and Jarred food products offer by company gain low market share, but are in demand.
Firm needs to invest in those goods after thinking much in context of its success and in future
demand.
Dogs-
In this category, low market share and growth products are included. Soft drinks that
chosen company offer to its consumers are included in list of low growth items because it does
not provide a good taste to consumers, which leads to decrease their demand in market.
Cash Cow-
Soft and fruit drinks may generate high revenue, but have low market growth which
make lead to affect business progress when firm invest on these.
PESTEL analysis-
Political factor-
Strong bond between nations and globalization may lead government of the United
Kingdom to promote free trade policy. This factor put positive impact on Oak Cash and Carry
Ltd, operations in term of providing chance to expand business across UK and export its goods
to profitable market or region.
Economic factor-
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Unemployment rate is one of the economic factors that put positive impact on Oak Cash
and Carry Ltd (Bushe, 2019). As it provide chance to hire new people who understand the needs
and requirements of local people that live with nation where firm operate or plan to establish its
outlet.
Social factor-
Vegan consumption is current market trend that most of the consumers are following and
adopted to make their life healthy (Saari and et.al, 2020). This force put positive impact on
chosen company in term of giving opportunity to grow its venture as it has already selling range
of vegan items.
Technology factor-
Advancement of digital marketing platforms or channels, put positive impact on Oak
Cash and Carry Ltd. It enables firm to develop effective marketing plan and strategy, which it
may use to promote products via different types of social media platforms such as Instagram.
Environmental factor-
Government and consumers in recent time are more concern about environmental
sustainability. It put a lot of pressure on companies like chosen one to reduce their carbon
footprint. As it affect positively upon company image and allow growing venture with it
successfully.
Legal factor-
Business law, regulations and policies are all legal factors that may affect the way firms
take decision or conduct each activity. Employment law put positive impact on Oak Cash and
Carry Ltd, because firm has already complexed all the rules, terms and conditions.
New service & product-
Oak Cash and Carry Ltd, may grow its venture and grab business growth opportunity by
manufacturing and introducing new vegan snack as product. It provides many benefits in form of
increasing sales, profitability, revenue and permit gain competitive advantages. Furthermore,
along with this organization by offering home delivery service to consumers may grow its
venture even better than other organizations.
Collaboration-
Collaboration in regard to company is a key source that help to grow business and allow
reaching at global level (Gao and et.al., 2019). There are different types of sources or methods
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are available in corporate world that chosen small firm may used to conduct collaborative
practices with other organization that operate in market where firm will plan to enter. Joint
venture, mergers, business acquisitions etc. are the approaches of business growth.
Chances for growth by applying Ansoff's growth vector matrix
Ansoff's Growth matrix is one of the best and most commonly utilized frameworks that
companies used to examine and plan their growth tactics. This model defines four different types
of growth options that Oak Cash and Carry Ltd, may use to gain benefits in term of excellent
business progress.
Market penetration-
This growth option is quite different from the other three as it provides chance to firm in
form of increasing their sales and profitability level, more than last few months or years.
Organization may use this and gain benefits by focusing on improving products quality which
enable management to sell within existing market to target segment (Noerhartati and et.al.,
2019). With market penetration, selected company increase its products sales which is quite
beneficial for Oak Cash and Carry Ltd.
Product development-
The best opportunity that chosen small company may grab to grow its business is product
development. With this option, firm may introduce new products or service which make its
company more powerful than other firms (Cooper, 2019). It allows organization to reach at
international level with existing new products categories. It drives attention of management
towards manufacturing those goods that in recent time buyers like to purchase.
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Market development-
Along with above two strategies that Ansoff's Growth Matrix described in context of
business growth, company may consider also third one and that is market development.
According to this tactic, Oak Cash and Carry Ltd, grab opportunity to grow their business by
developing plan and focusing on entering into new or profitable market with existing goods.
Market development in form of effective strategy, provide the best opportunity to firm (Wanjiru,
Muathe and Kinyua-Njuguna, 2019).
Diversification-
It can be evaluated that diversification strategy provide risky but beneficial growth
opportunity to Oak Cash and Carry Ltd. As it allow firm to develop market entry plan with
introduction of unique and value added product. This tactic caters benefits in term of generating
brand awareness at global level and increasing customers base as well. With diversification as
strategic option, organization may boost its productivity and profitability, which is actually very
important to increase.
Illustration 1: Ansoff Matrix
(Source: Ansoff Matrix Growth Strategies, 2021)
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Discussion based on options in context of business growth
From above discussion, it has been identified that application of Ansoff's growth matrix
stated four options for growth in context of Oak Cash and Carry Ltd. Organization among four,
may chose the market and product development, which is quite beneficial options for its business
as it helps to grow even better and contribute increase market share. It enables firm to gain
competitive advantages after selling new products within new market place where consumers are
seeks to buy vegan food products. Organization may manufacture and sell goods in new region
according to needs and trend that many people follow.
Critical analysis based on particular options & pathways for progress
Diversification strategy-
Risk and mitigation-
It is one of the Ansoff's Growth options that may Oak Cash and Carry Ltd use in regard
to business growth. The biggest risk that chosen company may face with this option is a failure,
especially when the new consumers will not like the new item.
Management mitigates above risk by conducting depth market research before
manufacturing a new item.
New product and service development-
Risk and mitigation-
Financial risk is encompasses with this option which may put negative impact on growth
of company. It could be mitigated by firm via using the potential and most appropriate sources of
funding, which enable to make essential investment in regard to new product development.
Collaboration-
Risk and mitigation-
Degree of investment and expertise is not equally matched with joint venture in form of
collaboration option. It included in category of risk that may hamper growth and success of
company.
Firm can be mitigated above risk by making an legal business contract in which all the
terms & conditions relate partnership or collaborate will be mentioned.
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TASK 2
Development of business plan for business growth that includes financial data and strategic
objectives for scaling up chosen venture
Executive summary-
Oak Cash and Carry Ltd, desire to grow its business and gain competitive advantages.
Due to these reasons, firm has produce new vegan snacks, which they sell to target consumers
who are eager to buy these.
Mission-
The mission of chosen company is to become a global leader, which enhance its
productivity and profitability.
Vision-
Vision of Oak Cash and Carry Ltd, is to increase customer base and their satisfactory
level.
Objectives-
To increase consumer base by 20%
To generate revenue up to 40%
To become a market leader.
To enter into new market place with wide customer base and good financial performance.
Industry and market analysis-
SWOT analysis-
Strengths-
Effective management is the key
strength of chosen company, which it
may use to gain several advantages
such as increase customer base.
Skilled and talented workforce is
another strength of firm.
Weaknesses-
Lack of human resource is one of its
weaknesses that may put negative
impact on growth opportunities of Oak
Cash and Carry Ltd,
Lack of marketing technologies usage,
within selected small firm is its another
weak point.
Opportunities-
Technology advancement is the best
Threats
Intense competition within food
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opportunity that company may grab to
promote its new vegan snack all around
the world.
Business expansion is one of the
growth opportunities that provide
valuable benefits to organization and
help to gain desire outcomes.
wholesale industry posses threat in
context of Oak Cash and Carry Ltd, as
it hamper business growth planing
process and strategies.
Change in tax rate and trading policy
also posses threat for organization and
put negative impact on success of
current business plan.
PEST analysis-
Factors Impact
Political factor Trade restriction put negative impact on
production and products cost.
Economic factor Unemployment as economic factor put effect
on sales of company positively as it strengthen
its workforce by recruiting new applicants.
Social factor Current market trend affect the way Oak Cash
and Carry Ltd, produce its existing and new
product as it impact in positive manner.
Technology factor Advancement of technology bring benefits for
company in term of increasing its products
sales.
STP-
Segmentation-
Before producing and selling new vegan snacks, Oak Cash and Carry Ltd, will need to
chosen specific target segmentation strategy. It may utilize demographic and psychographic
segmentation strategies and according to that firm target women's because most of the female
take decision relate to grocery purchase in the whole world (Gajanova, Nadanyiova and
Moravcikova, 2019).
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Targetting-
The main target market of Oak Cash and Carry brand is women's, because of above
reason and other as well for example, women have better understanding about what is good for
their family and according to that they purchase products.
Positioning-
In order to gain attention of target market, chosen company the best marketing source or
channel in make them able to promote its new vegan item in all over the world.
Market trends-
Vegan consumption is now in trend that impact food manufacturing companies in
positive manner in term of offering vegan items that consumers like to purchase in bulk, more
than other items that are manufactured by using chemical and other things.
Plastic packaging is another trend that affect product packaging operation of Oak Cash
and Carry Ltd, and drive their attention towards using recyclable materials to pack food products.
Consumer and value proposition-
The target market will purchase new product offer by organization because it is good for
health and taste. The best thing about vegan snacks is that they are free from any kind of
contamination or chemical things.
Market strategy-
4P's-
Product-
Oak Cash and Carry Ltd, in order to increase its consumer base will focus on
manufacturing their new products and should provide good quality.
Price-
Organization in context of new item may chose low pricing strategy, which is quite
beneficial in term of increasing customer base and sales.
Promotion-
Company may use traditional along with digital marketing tools to advertise vegan
snacks all over the world.
Place-
Firm should sell new product through own outlet by setting specific area where all vegan
snacks will be displaced.
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