Strategies for Scaling Up a Business: A Comprehensive Report

This report provides a comprehensive analysis of business growth strategies, focusing on the case of a small handmade crafts business facing challenges due to lockdowns. It begins by analyzing key factors for evaluating growth opportunities, emphasizing innovation, competition, and collaboration. The report then applies Ansoff's growth vector matrix, evaluating market penetration, product development, market development, and diversification strategies. It identifies options for progress using a framework, highlighting strategies for gaining a competitive advantage. Furthermore, the report examines potential sources of funding, analyzing their drawbacks and benefits, and evaluates the best funding options. It also includes the design of a detailed business plan for growth, followed by an assessment of exit or succession options for small businesses, including their advantages and disadvantages. The report concludes with recommendations for implementing effective strategies to support business growth and sustainability.

Scaling up the
Business

Contents
INTRODUCTION...........................................................................................................................4
MAIN BODY...................................................................................................................................4
TASK 1............................................................................................................................................4
P1 Analyse key factors that help to evaluate the growth opportunities.................................4
P2 Evaluate the opportunities for growth applying Ansoff’s growth vector matrix..............5
M1 Identify the options for progress by the use of framework and explain using advantages.
................................................................................................................................................7
D1 Find out the options that are available for growth and how risk can be decreased..........7
TASK 2............................................................................................................................................8
P3 Find out the potential sources of funding that are available to businesses and analyse their
drawbacks and benefits..........................................................................................................8
M2. Evaluate potential sources of funding and justification for the adoption of an appropriate
source of funding for a given organisational context.............................................................9
D2. Find out the most appropriate source of finance and the reason to choose the source....9
TASK 3..........................................................................................................................................10
P4 Design a business plan for growth..................................................................................10
M3 Construct detailed business plan for growth of business enterprise..............................12
D3 Present a detailed business plan that shows knowledge to apply and achieve business
objectives in an effective manner.........................................................................................12
TASK 4..........................................................................................................................................12
P5 Assess exit or succession options for a small business explaining the benefits and
drawbacks of each option.....................................................................................................12
M4 Evaluate exit or succession options for a small business comparing and contrasting the
options and making valid recommendations........................................................................13
D4 Write about the exit options that are available for a small business and take appropriate
decisions...............................................................................................................................13
CONCLUSION..............................................................................................................................15

REFERENCES..............................................................................................................................16
Books and Journals...............................................................................................................16

INTRODUCTION
Business is uncertain so it important for the owner of business to plan in effective way for
the growth of business as well as it contributes to GDP of the nation. In this report there is
discussion relation a SME started by Zoe Allen in which she deals in hand craft. The company
deals in various products like beeswax candles, greeting cards, pottery and potpourri. Due to
lockdown she is facing some problems (Sclar, Baird-Zars, Fischer and Stahl, 2019). In this report
there is discussion related to the growth opportunities available for the business. Ansoof matrix
in regard to growth is also part of this report. Business plan including financial sources available
are also part of this report. Along with that selecting the best source of fund that will help the
business to grow is mentioned in report. The exit routes that are available for SME along with
advantages and disadvantages are part of this report. In the end there is critical evaluation related
to succession options for a small business along with recommendations that will support
implementation.
MAIN BODY
TASK 1
P1 Analyse key factors that help to evaluate the growth opportunities
It is important to note that growth is vital in every business. It is seen that no business can
run without making a considerable amount of growth and earning money. It is vital for all the
business organisations to conduct research and take care of all the business aspects so as to grab
the opportunity and grow (Dranka and Ferreira, 2018). It is vital to note that competition is
increasing day by day so it becomes vital for the business to take care of all the important
resources that are required by a business organisation to grow. If it is a large or small
corporation, every organisation wants to succeed for a longer period of time. They want to sell
their goods both locally and internationally. Small-scale businesses are recognised to play an
important role in the economy, contributing to gross domestic product. The various points that
must be considered by business organisation while evaluating the opportunity for growth are
described below:
Innovative product and services: It is important for the business organisation to bring
some innovation in the product and service that is offered by them. As it helps them to attract the
customers and formulate strong image in the market (Ponzini and Santangelo, 2018). It is one of

the points that help the business to gain edge over the rivalry. Innovation is one of the reasons
for success of an organisation. In regard with the business of Gallery and Art Studio they are also
using innovative product that are designed by Zoe Allen. This helps them to develop new
products and that will help to serve the customers. This will help to produce goods and services
at affordable price and serve the needs of customers.
Competition: It is important to note that competition is present at every level. It is vital for
a business to check about the competition in the market and identify the strategy used by the
competitors. It is helpful for a business organisation to take measure that helps them to gain
advantage over the competitors. In will help Zoe Allen to actions that will help to gain success
and achieve growth in Gallery and Art Studio.
Growth options: As the market is dynamic and it is important to analyse the option of
growth that are available in the market. It is important to select best price, market development
strategies that will help the business organisation to grow (Mazzarol and Reboud, 2020). In
regard to Gallery and Art Studio they are planning to expand their operations and serve more
customers and earn more revenues. Along with it is time to focus on the trends in the market and
innovate the product in the market. In relation to Gallery and Art Studio it is observed that Zoe
Allen has capabilities that help her to develop the product and gain competitive advantage.
Collaboration: It is important to note that collaboration is also an option that is available
with the business organisation. It is vital to note that with help of collaboration the problem of
resources, money is solved. As there are various options like mergers, acquisitions, strategic
alliances are available. It is vital to note that Gallery and Art Studio can arrange money and that
will help them to grow. In this regard Porter five forces will help to know about the competition
in the market as well as formulate strategies that will help to gain advantage over the
competitors. It is also seen that the business firm will know about the external factors by doing
PESTLE analysis. It will become beneficial for the organisation and achieve success.
P2 Evaluate the opportunities for growth applying Ansoff’s growth vector matrix.
It is a grid that is used by business organisation for development of product or service
offered by them. It basically has four strategies that help the business to analyse the risk in
advance and find option for growth (Rode, 2018). These business strategies help in growth of
business organisations. The description related to all the strategies that come under Ansoff’s
growth vector matrix in regard to Gallery and Art Studio are discussed below:

Market Penetration: It is strategy that helps the business organisation to serve the existing
customers and provide them the same product. It helps to increase the profitability of the
company (Hu, 2017). This can be done in case of Gallery and Art Studio by opening the store for
more hours. They also concentrate on increasing product marketing and delivery so that
everybody is aware of their goods and services. It is also listed on that day, so take advantage of
the opportunity to acquire a competitive in the same region.
Product development: It is the next strategy and under this the focus is on developing the
product to its existing customers. It is seen that the customers like innovation in the product and
service (Bernstock, 2020). Product development helps to attract the customers and attain growth.
In this step Gallery and Art Studio can innovate the product as well as start new ways of
packaging the product for the growth of business. They can also launch new product as per the
demand of the existing customers.
Market Development: It is a strategy in which business plans to expand operations of its
market. It helps to serve more customers by attracting new customers toward the business
organisation. There is need of proper research and development to know about the need of
customers and then expand the business in the direction. In relation to Gallery and art studio they
should also conduct research and then identify the market that they can serve to achieve success
and growth. The company will focus on existing customers as well as try to attract new
customers.
Diversification: It is strategy of entering in new market with new product. It helps business to
expand the line of operation. The product may be similar as well as different as it will help to
gain more profit (Hosseini, Barzoki and Isfahani, 2018). Along with that sale of the company
will also enhance due to diversification strategy. There are chances of gaining advantage over the
competitors so that they can earn huge revenues.
From the above discussion it can be evaluated that there are various strategies that are
available for a business organisation to expand their operations and grow. This is up to the
business that which strategy they want to use and will be profitable for them in the present
scenario. In relation to gallery and art studio they are planning to extend their operations and take
a new premise on rent where they can develop their product as well as attract new customers
towards the same product by getting innovations. They are not planning to diversify the line in
detail planning to develop the market and product for their customers as well as to target new

customers. This will help them to on more profits than before and will help them to pay the due
rents.
M1 Identify the options for progress by the use of framework and explain using
advantages.
As the competition is rising each and every business focuses on growth. The small and medium
sized organisation is also to on profits and extends their business (Kagho, Balac and Axhausen,
2020). It is seen that the nature of business is dynamic so there is requirement of formulating
various strategies that will help to gain advantage over the competition. Some of the strategies
that will help art gallery studio are mentioned below:
 First of all proper research of market trends and needs and want of customers help to
satisfy the needs and wants of customers and gain advantage over the competition.
 The pricing strategy of the company should be also strong so that the product is available
at affordable prices to the customers and the quality is also not compromised at the same
time.
 The company should always focus on innovating the product so is the customers are
attracted towards the business (Var and Gunn, 2020). Along with that the packaging
should be attractive as in relation to handmade craft the customers also look for good
packaging.
These are some of the ways that help Gallery and Art studio to gain advantage over its
competitors and on more and more profits.
D1 Find out the options that are available for growth and how risk can be decreased
There are various options that are available for growth of business organisations. The options
are collaboration, mergers and acquisitions. It is vital to study importance and drawbacks of each
method.
 The risk is collaboration is that there is lack of privacy and the information is also shared.
So it is suggested to keep the information private and manage the work effectively.
 The company may lack control as well as the other company may lose the decision
making authority (Mehrjerdi and Hemmati, 2020). A proper contract stating the terms
and conditions should be formulated.
It is important to identify the risk in advance as well find ways of mitigating those risks for
the growth of the business organisation.

TASK 2
P3 Find out the potential sources of funding that are available to businesses and analyse their
drawbacks and benefits.
Finance is called backbone of every business. It is seen that every business organisation
need money to operate in the market. There are number of sources through which business can
collect money to expand its operations (Reillier and Reillier, 2017). The choice of the best this
finance source is most prominent for them and helps them to achieve their goals and
organisation. In relation to Gallery and Art studio expand their company for the benefit of them
and to gain a competitive edge for them. In this regard, the management team focused on
obtaining best fund and appropriate sources of finance, which are useful in conducting various
activities. The sources are mentioned below:
Bank Loan: It is seen that bank provides loan to expand their operations. It is a good source of
getting money for expanding the business (Dupuits, Baud and Hogenboom, 2020). It is
authenticated source of finance. The company has to face a fixed amount of interest to the bank
for the loan.
Benefit:
 It is authenticated source of finance and the company has to pay fixed amount of money
on specified time intervals.
 Bank loans are temporary.
 The interest of bank loan is tax deductible
Drawback:
 As the business has to pay the money on regular basis it becomes problematic in situation
of loss.
 It is difficult to get the loan and there is need of collateral.
 The interest rates are generally high.
Crowd funding: It is a mechanism that considers a significant amount of money and is therefore
beneficial to companies in terms of providing funds for their business venture. Small businesses,
on the other hand, put a greater emphasis on raising funds from a variety of sources in order to
keep their operations and activities up and running the business effectively.
Benefit:

 It is beneficial for the small business organisations to take funding as the rate of interest
are generally low and that is profitable for the business organisation (Löwe, and
Teshome, 2018).
 It is a fast way of getting loan.
 The investors become loyal in this case.
Drawback:
 If the business plan fails then the reputation of the business also goes down and it
becomes difficult to repay the money.
 If the business doesn’t meet your funding goal, any funds committed will normally be
refunded to your investors, leaving you with nothing.
 If the business gets the rewards or returns incorrect, you may end up handing away too
much of your company to investors.
Peer to peer loans: These loans are more flexible than conventional loans because they are
considered unsecured, which means they do not need any collateral protection and do not require
the mortgage on any personal property to cover the debt (Fracassi, Siekmans and Baker, 2020).
Benefit:
 It is advantageous in terms of providing a low interest rate, which is advantageous for a
new business company, as well as providing online application services.
 There is transparency in the organisation.
 It gives high returns to the investors.
Drawback:
 The disadvantage of this is that it requires a credit check and other internal protection for
the loan.
 Cash cannot be lent right away.
 There is a time constraint.
These are the options that are available with us small business to take funds from. The
advantages as well as disadvantages along with each source are mentioned So as to take wise
decision and choose the option that is beneficial for the business organisation.

M2. Evaluate potential sources of funding and justification for the adoption of an appropriate
source of funding for a given organisational context.
It is seen that there are various options that are available in the market and it is vital to
understand the best suitable for the company. These are the techniques that are available for the
company (Lukarov, Verbert and Schroeder, 2019). It is seen that in relation to Gallery and Art
studio they are planning to take loan from bank. Moreover that is most authenticated source that
is available for the business. It will help in expansion of the business. This will help company to
pay the interest on timely manner and that is effective for the business organisation. It will be
beneficial for the business organisation to use the method and expand the operations as and
where they want to.
D2. Find out the most appropriate source of finance and the reason to choose the source.
Small businesses should ensure that their sources of funding are increasing so that they can
become more profitable. They must first define and analyse each choice to determine which is
best for the organisation. It is not a simple task since the organisation requires you to argue each
choice in order to make an informed decision. It is possible to do so by evaluating each
alternative. It is extremely important for the growth and success of business. According to the
provided source of account, there are various strategies that organisations use to collect cash that
is essential for their activities and capacity. In relation to Gallery and Art Studio the business
should go for bank loan as it will be beneficial for the organisation.
TASK 3
P4 Design a business plan for growth
It is important to formulate a business plan as it helps the business organisation in future. It
is seen that setting goals and objectives and formulating strategies to achieve them it beneficial
for the company (Trilling and Jonkman, 2018). It helps to forecast about the risk and get ready to
work in an effective manner. A business plan is a document that is useful in achieving planned
goals and objectives and is formulated by management of Gallery and Art Studio to achieve
appropriate development.
Company Overview: The Company is established by Zoe Allen naming Gallery and Art
Studio. It is a handicraft company that is operated by Zoe Allen and two part time employees.
The products that she makes are greeting cards, pottery, beeswax candles, and potpourri. The

shop is at Baker Street area of Central London (Atkinson and Lind, 2018). She sells all these
handicrafts to larger gifts and souvenir shops in and around Central London. They are planning
to expand the business and serve more customers.
Mission and vision: The mission is to raise the awareness about the company and serve
more and more customers. They are planning to expand their operations and open more studios.
Along with that she wants to provide employment opportunity to people that is capable of doing
the business.
Strategic objectives: It is critical for the company's management to create SMART goals.
The objectives in relation to Gallery and Art Studio are as follows:
 To open 5 more studios in next 5 years
 To increase awareness about the business
 To enhance the sales by 5% by upcoming 3 years.
STP: It is a process of segmenting the population, targeting the customers and the
positioning the product in the mind of customers. It is seen that in relation to Gallery and Art
Studio all the people that like and are need of handicraft are targeted (Gebauer, Haldimann and
Saul, 2017). The age limit is of 15 to 35 years. As this generation is eager to give gifts and use
handicrafts. The company will position itself as handmade quality goods at affordable prices.
Along with that the goods are customised as per the wants of customers.
SWOT Analysis: The SWOT Analysis of to Gallery and Art Studio is done below:
Strength
It is important to note that the company has
power of manufacturing quality goods and
services that are customised and will help to
serve the customers.
Weakness
There is need of money and it is difficult to
arrange money.
Opportunity
There is need of handicrafts in the market. It is
an opportunity for Gallery and Art Studio to
attract and serve a market segment.
Threats
Competition is threat that to Gallery and Art
Studio is facing. As they have small
operations.

Market budget: One of the most important parts of marketing plan is setting budget. It
is vital to note that money is required by an organization to work on its operations and to expand
the business. There are number of sources and Gallery and Art Studio chose bank loan to expand
the business. So it is important to take the amount of loan that is required and important to
expand the business.
Marketing budget
Particulars 1st year 2nd year 3rd year 4th year 5th year
Initial money 6000 8500 12000 14500 18350
Investment 12000 14000 25500 32000 13500
Total 6000 22500 37500 46500 31850
Marketing outlay
Promotion 6500 3200 4300 3300 3250
Sales publicity 2200 2100 3300 2200 2000
Direct selling 4200 2500 6000 3000 4650
Total 12900 7800 13600 8500 9900
M3 Construct detailed business plan for growth of business enterprise.
It is vital for business organisations to form a strong and effective business plan that helps in
growth of their business. It is important for the business to set objectives and strategies in such a
way that is beneficial for the growth of business. So they should formulate strategies in a manner
that helps to achieve the goals along with that it will help the company to become successful.
That company should supervise and pursue a course that involves many actions related to the
launch of new products in the market. They also focus on various areas such as the most efficient
use of capital and finance, among others.