Prufrock Coffee: Growth, Funding, and Business Plan Analysis Report

This report provides a comprehensive analysis of growth strategies for Prufrock Coffee, a London-based coffee shop. It begins by exploring key considerations for evaluating growth opportunities, including Porter's generic strategies and an analysis of competitive advantages within the SME context. The report then evaluates growth opportunities using Ansoff's growth matrix, analyzing options such as market penetration, market development, product development, and diversification. Furthermore, it identifies and assesses various funding options available to the organization, including crowdfunding, peer-to-peer lending, bank finance, and business angels, with justifications for the chosen sources. Finally, the report culminates in the development of a business plan, addressing scaling strategies and potential exit options for the owners. The report covers financial, operational, and market projections for Prufrock Coffee, providing a detailed roadmap for its expansion and success.

PLANNING FOR GROWTH

Table of Contents
INTRODUCTION...........................................................................................................................3
LO1..................................................................................................................................................3
Key considerations for evaluating growth opportunities with justification in the organizational
context..........................................................................................................................................3
Growth opportunities with the evaluation of Ansoff's growth matrix.........................................4
Analysing different growth options for business.........................................................................5
LO2..................................................................................................................................................6
Available funding options for organization to assess potential sources......................................6
Evaluation of Source of funding with justification of the choice................................................8
LO3..................................................................................................................................................8
Business plan development with communication on the scaling of business..............................8
Exit options for owners in the industry......................................................................................14
REFERENCES..............................................................................................................................16

INTRODUCTION
Planning is considered as an essential practice for businesses to achieve higher growth in
the industry and enhance their overall performance. The current report will be based on Prufrock
Coffee, a small coffee shop which is situated in London, UK having expert staff that are trained
in order to provide a great experience to their customers. This report will explain the key
consideration while evaluating growth of an organization, different methods through which a
business is able to seek appropriate funding with suitable ways to utilize them properly, business
plan with an intent to increase the scale of the business and different ways by which a small
business owner is able to exit the business with the implications of each of the options.
LO1
Key considerations for evaluating growth opportunities with justification in the organizational
context
Prufrock Coffee is a newly established cafe which has gained popularity among the
audience due to their unique taste and simplicity in the way they treat their customers. The
organization has been able to deliver quality services to their customers which has a positive
impact on their overall success in the industry (Chirico, and et.al., 2020). It has become highly
crucial for the organization explore more opportunities to expand their business area and gain a
significant market share in the industry. SME is considered as a small and medium size business
organization which has comparatively lesser employees and operates at a smaller scale in the
industry.
Competitive advantage is referred as a major feature which provides benefits to an
organization in comparison with their key rivals in the industry. This aspect may have a
significant impact on the overall success of Prufrock Coffee in the UK food and beverage
industry. There are several competitors which enjoy a significant market share in the industry
that has a deep impact on the overall growth of the company in the complex business
environment. There are several strategies which can be adopted by the business in order to
increase their growth and development in the industry (Du and Li, 2020). The organizations may
develop new and attractive products to offer to the customers which are suitable in order to
increase the competitive advantage of the business. There are several changes which may be
made by the organization in their organizational framework. These aspects may have a
significant influence on the overall effectiveness of the organization to achieve better success in

the industry. There are several generic strategies which will be defined with the help of the
Porter's generic strategies which is a smart framework used to define various strategies for a
businesses to achieve growth in the industry:
Porter's generic strategies
Cost Leadership
This strategy suggests that a business may consider reducing their prices of products and
services in order to provide better convenience to the customers. This may have a positive impact
on the overall sales of the business which plays a vital role in the overall success of the
organization.
Differentiation
Under this strategy, the business organization may highly focus on differentiating their
products and services from their competitors which is a major aspect that is crucial for the
success of the business in the industry. Diversity in products may be a major factor which can be
helpful in attracting customers towards the products and services of the business.
Cost Focus
This strategy may consider giving sheer emphasis to a niche population which is
provided with the products and services with an aggressive cost by the organization.
Differentiation Focus
Similarly, a niche market is targeted in this strategy with differentiated products which
are helpful in increasing their overall success in the industry.
The differentiation strategy can be highly crucial for the business to target their
customers in a specific manner and gain their trust towards the business practices. It is further
useful for the organization to grow and enhance their services which are having a positive impact
on the success of the business. This strategy may be useful for the organization to gain
competitive advantage which is further useful for the company to grow in the industry.
Growth opportunities with the evaluation of Ansoff's growth matrix
Market Penetration
This growth strategy is useful for businesses to achieve growth in the industry by
increasing availability of their existing products and services in the current market. Several
changes may be made by the organization to grow and achieve better success which is necessary
for increasing its market share in the industry.

Market Development
This strategy further focuses on introducing existing products and services into newer
markets which help in increasing the overall success opportunities of the business. With the help
of this practise businesses are able to grow their existing market share in the competitive
business environment significantly (Jensen and Creinin, 2020).
Product Development
New products and services are developed by a business organization in the current
industry under this strategy which may be useful for the businesses to enhance their overall
performance in the industry.
Diversification
This strategy is considered as having the highest risk in comparison with the other
methods which are considered as effective for the business in the industry. These aspects may
have a significant impact on the success of the company which is crucial for achieving
sustainability in the complex business environment.
Analysing different growth options for business
Development of market
There are different areas of the market which can be explored by the business in order to
gain better advantage and enhance their services in the industry. There are several changes which
needs to be addresses by the organization in order to adapt effective strategies which are related
with the growth of the business.
Selecting strategy of product marketing
The business may develop new and attractive products for their customers in the existing
markets which will be beneficial for the company to gain better advantage and enhance their
services in the industry. Prufrock Coffee may be able to gain benefit with the help of this strategy
which is highly crucial for the business to grow and achieve better success in the industry.

LO2
Available funding options for organization to assess potential sources
There are several options which are available for the business to seek funding from the
market which will be beneficial for them to conduct the business practices appropriately. These
options include:
Crowd funding-
This method of funding is considered to suitable for the businesses that have crossed the
line of being an early business and planning to expand their services in the industry. Money is
lend by the public directly under this type of funding method which is beneficial for the business
to invest for conducting their operations appropriately (Raghavan, and et.al., 2020).
Advantages
It is useful for the business to save their extra expenses like paying upfront fees and
charges, having a positive influence on the overall profitability of the business. Ideas of a varied
people will be beneficial for the organization to improve their decision-making process and
increase the efficiency of their tasks which take place in the industry significantly.
Disadvantages
This processes is considered to be a bit complex in comparison with the other traditional
way of raising fund for the business in the industry. Significant amount of research is required by
the business to seek funding from the crowd for supporting their organizational activities.
Peer to peer lending-
This funding source is useful for the business to seek monetary support from their family
and friends in form of debt to support their business in the industry.
Advantages
This is beneficial for the investors to seek better investment which is crucial for the
business to grow. It is more accessible as there are fewer complications imposed by peers on the
businesses (Tenca, Croce and Ughetto, 2018). Interest rates are further less in this type of method
in comparison with other sources.
Disadvantages

There is a risk of protection or security in type funding method which may have a
significant influence on the overall success of the business in the industry. Government may also
not support this type of funding method in any kind of problem.
Bank Finance-
Financial institutions and banks are the major lending bodies which provide the business
with adequate amount of capital which is necessary for fulfilling the needs of the organization.
Advantages
Equity of business is not scarified in this type of funding source which is beneficial for
the organization to enhance their services and gain better advantage in the industry. This
business is not liable to pay the profit percentage which is earned by them from these loans and
are only required to pay interests to the financial institutions.
Disadvantages
Cash flow problems in the business environment may lead towards inconvenience which
is inappropriate for the business to maintain its sustainability. Assets of business are often at risk
in this type of funding source which is a serious matter of concern.
Business angles
The wealthy and established businessman provides various small business with funding
options in order to get a share in their business in return (Zinecker, and et.al., 2022). They are
individuals which have an experience of several years in this field and understand the dynamics
of the business environment.
Advantages
These investors are helpful in enhancing the overall decision making process of the
business. It is a unique factor of this type of funding source which is beneficial for the business
to prepare effective strategies. There is also no need of any type of security deposit required
under this funding source.
Disadvantages
This funding source is not suitable in case of significantly lesser investment required by
the business to operate in the industry. Finding a suitable angel investor is a tedious task for any
business.

Evaluation of Source of funding with justification of the choice
Prufrock Coffee may adopt different type of funding options for strengthening their
internal composition and increasing overall success of the business in the industry. They can
seek funding from Business Angels as it may be a crucial step which can provide stability and
agility to the business to expand their services and make informed decisions towards their
success. The financial and psychological support from these angles will be helpful in increasing
the overall effectiveness of the business to achieve higher quality of output which is necessary
for the business to grow in the industry.
Another effective funding source for the business is bank finance as it will provide better
balance for the business to manage their equity and debt in a proper manner (Cornaggia, Wolfe
and Yoo, 2018). The company will not be liable to share their profits with the banks which may
have a positive influence on the overall success of the business in the industry.
LO3
Business plan development with communication on the scaling of business
Executive Summary
The main purpose of this business plan is to highlight various practices which are crucial
for the Prufrock Coffee to grow and expand their services which are necessary for the business
to achieve success in the industry. It will deeply explain the financial plan, operation plan and
market projection of the business.
Company History
Prufrock Coffee is situated in Central London which was found by a group of people that
had a major interest in exploring different forms and tastes of coffee. It has achieved massive
popularity and recognition among the audience which has been a major supporting factor for the
business to gain a better competitive advantage in the industry (Olmos and et.al., 2020).
Product and Services

It is a coffee shop which provides a variety of coffee beverages with a unique ambience
for the customers. Specially bruted coffee with a tasty experience is provided to the customers
for increasing their overall satisfaction levels in the industry.
Business Concept
The main concept of this business is to provide utmost customer satisfaction to the
population and enhance their overall experience of having a quality time with their friends and
family significantly.
Industry Analysis
PEST analysis will be beneficial in identifying the external factors which have a negative
influence on the overall success of the business in the industry.
Political
The instability in the political environment of UK may be inappropriate which can
increase issues for the business to operate freely in the in industry (Wahyudi and Suharnomo,
2019). The policies and procedures introduced by the government may often increase restrictions
for the business to operate successfully.
Economic
Fluctuations in the monetary or fiscal policies of the business are the major factors which
resulted in the increase in tax rates which had a negative influence on the business.
Social
Cafe culture has experienced massive popularity and growth due the interest of
millennials in exploring new places regularly in their free time. It may have a positive influence
on the overall success of the business to grow and expand their services in the industry.
Technological
Development of various social media platforms have been essential for the increase of the
interest of the customers in exploring new coffee shops. This may be one of those positive
factors which have a positive effect on the overall success of the business in the industry.
Vision

The vision of Prufrock Coffee is to expand their services in the market and gain better
competitive advantage in the industry in a short span of time.
Mission
Providing their customers with a quality experience of their favourite beverages and
snacks in order to increase their overall satisfaction levels is the mission of the business.
Objectives of business plan
The organization is currently operating at a smaller scale than its major competitors
which gives a lesser edge for the company in the industry. The primary objective of this business
plan is to create better opportunities for the business and enhance its overall market share.
Analysis of Market
SWOT analysis is a suitable framework which is useful in analysing the different internal
and external factors which have a significant impact on the business. These are as follows:
Strengths
The organization has a good taste in their dishes which is liked by the customers, and they have
an attractive ambience for offering to their customers (Pan and et.al., 2019).
Weakness
Lack of resources and support with the business to expand their market share is a major
weakness of the company to operate successfully in the business environment.
Opportunities
The organization may acquire more customers by expanding their services in different
places and conducting promotional activities which will have a positive influence on the overall
success of the business in the industry.
Threats
Lack of appropriate capital and the competitive advantage of the competitors may be the
potential threats which has a negative influence on the overall success of the business in the
industry.
Porter's five forces

Bargaining power of customers
This force has high power as there are various options and alternatives for the customers
to explore in the industry significantly. These aspects may have a significant influence on the
overall sustainability of the business in the competitive business environment.
Supplier bargaining power
There are many suppliers available for the business in the industry which reduces their
power of bargaining with the business and increasing their overall advantage.
Threat of the new entrant
It is competitively easier for new entrants to establish a coffee business which increases
the threat for the Prufrock Coffee to stay sustainable in the business environment.
Competitive rivalry
This force has high power as they are many competitors of the business such as DRIPP,
Cafe Kubal, Q Cafe etc. which may have a good market share in the industry. These businesses
may have a significant competitive advantage which can have negative influence on the overall
success of the organization in the business environment (AKMAN, 2020).
Substitute product threat
There are several substitutes for coffee like tea, milkshakes, smoothies but people
generally develop a habit of coffee which may be difficult for them to overcome. Thus, this force
has a weak power upon the business.
Business Economies
The organization is focussing to increase their reach and acquire more customers in order
to generate more profitability in the industry. These factors are crucial for the business to grow
and enhance their skills which are necessary for the company to gain better advantage and create
success opportunities for the business to stabilize their economic condition.
Marketing Plan
The marketing plan is a useful tool which is beneficial for business to plan their
promotional practices and enhance the overall quality of output which is achieved by them in the
industry. Elements of the market plan of the business are as follows:

7 P's of Marketing mix
Product
Prufrock Coffee a unique experience of the favourite coffee with a twist of attractive
ambience and various snack dishes for offering to the customers. They have developed various
flavours by analysing customer needs for increasing their overall satisfaction from these
activities.
Price
The products will be provided at lesser costs to the customers which is useful attracting
them towards the products and services which are provided to them on a regular basis by the
organization.
Place
Coffee shops will be situated at prime locations by the business which is beneficial in
order to seek the attention of more customers in the industry.
Promotion
Promotional and advertising activities will take place with the help of social media posts
wand stories which will be useful for the business to spread awareness among the customers
about their products and services (Hans, 2018).
People
Highly qualified and dedicated candidates will be added to the team for enhancing the
overall productivity of the business in the complex business environment significantly.
Process
Effective processes and machines will be installed in the coffee shop for enhancing the
work experience of the staff members and increasing the overall success of the business in the
industry.
Physical evidence
Presentation of the business is a highly crucial factor which will be given due emphasis
by the business in order to gain better advantage and enhance their success ion the competitive
business environment.
Operational Plan