Planning for Growth: SME Business Plan, Funding & Exit Strategies

This report provides a comprehensive analysis of growth planning for Trading Scents, a UK-based SME, focusing on market expansion through the introduction of natural fragrances. The report utilizes PESTLE analysis, Porter's generic strategies, and the BCG matrix to evaluate growth opportunities. It assesses potential funding sources and applies Ansoff's Growth Vector Matrix to explore market penetration, product development, market development, and diversification strategies. A detailed business plan, including financial information and strategic objectives for scaling up the business, is designed. Furthermore, the report evaluates various succession and exit options available to small business owners. The analysis aims to provide actionable insights for Trading Scents to achieve sustainable growth and market leadership.

PLANNING FOR
GROWTH

Table of Contents
INTRODUCTION...........................................................................................................................3
PART 1............................................................................................................................................3
TASK 1............................................................................................................................................3
P1: Analysis and justification of key considerations for evaluating growth opportunities ...3
P2. Evaluation of opportunities for growth applying Ansoff's Growth Vector Matrix..........7
TASK 2............................................................................................................................................8
P3 & D2. Assessment of potential sources of funding available to businesses.....................8
M1. Options for growth..........................................................................................................9
M2. Evaluate potential sources of funding.............................................................................9
D1. Options and pathways for growth..................................................................................10
PART 2..........................................................................................................................................10
TASK 3..........................................................................................................................................10
P4 & D3 Design a business plan for growth that includes financial information and strategic
objectives for scaling up a business......................................................................................10
TASK 4..........................................................................................................................................15
P5 &D4. Evaluation of succession or exit options...............................................................15
M4. Evaluate exit or succession options..............................................................................16
CONCLUSION..............................................................................................................................16
REFERENCES..............................................................................................................................18

INTRODUCTION
Planning is defined as the level of thinking which is inserted while making plans so that
to attain desired objectives in most effective manner. Similarly planning for growth is defined as
preparation of such plans and strategies which are helpful for the business in gaining success and
growth opportunities as well. SME's are such small business which are associated with minimum
number of people within organisation and they have not so huge amount of revenue. In the same
manner in UK SME's are having higher growth opportunities within the country and this is the
major reason that SME's are supporting economy of the country (Ballaro and Polk, 2017). For
this report is based on Trading Scents which is one of the prominent SME existed within UK and
the company is dealing in scents. Trading Scents is associated with providing various types of
scents and now the company is planning to introduce natural fragrances which are made up of
natural flowers. This report is providing various aspects related with growth opportunities which
can be used by Pleasure foods in order to get market expansion and to develop market insight as
well. Besides this under this report comprehensive business plan is also enumerated which will
be used by Pleasure foods for developing their expansion plan. The business plan is associated
with such financial statistics which are helpful in gaining overall objectives of the expansion
plan.
PART 1
TASK 1
P1: Analysis and justification of key considerations for evaluating growth opportunities
For a SME analysing market condition is very much important in order to take various
considerations in account and to gain effective pointers in which growth opportunities can be
inhaled. In this manner analysis of market opportunities are highly required which are existed
within market so that succession aspects can be undertaken.
In this regards, the company is required to undertake external factors so that to examine
existed opportunities which can be helpful for gaining overall growth perspective. Hence in the
context of Trading Scents PESTLE analysis is elaborated as under: Political Factors: Political conditions are linked with political situation of the country and
existence of political stability. In the context of Trading Scents this is being analysed that
current political aspects within UK is not so favourable due to uncertainties in BREXIT.

Since political instability is associated with various negotiations so that the same aspects
are being imposed over the company so that for having long term business growth this is
imperative to align with such policies. Economic Factors: These factors are related with economic condition existed within the
country so that appropriate impact over the workplace can be examined (Shin, 2019). For
UK as the country is having significant economic condition and these are drawing
appropriate impact over business functions of Trading Scents. Economic factors are
linked with inflation rate, change in rate of currency so in the context of Trading Scents
these factors may add up value to the organisation so that ease in gaining higher profits
can be inhaled by the organisation. Social Factors: These factors are linked with needs, trends and market preferences of
people and customers as these aspects are having direct impact over business offerings.
For Trading Scents this factor is providing higher opportunities to the company as in UK
people are highly inclined towards using of natural fragrances which are affordable and
elite to them. In this manner Trading Scents is having appropriate opportunities within
market for gaining diversified customers. Technological Factors: These factors are lined with using of advanced technology in the
business practices so that necessary changes can be seen within organisation. In the
context of Trading Scents using of artificial intelligence could lead the company to use
robotics technology in their business functions so that to acquire higher opportunities in
manufacturing and process of distribution. Legal Factors: These factors are associated with application of legal laws and aspects
within business that would lead into developing sense of belongingness. In the context of
Trading Scents is using various laws such as cosmetic regulation Act, Equality Act and
many more. These lawful obligations are helpful for the organisation in gaining growth
opportunities and dealing with customers and employee satisfaction. Using such
legislations will be giving opportunities to the company is respect of intensifying and
improvements in business practices.

Environmental Factors: These factors are associated with the manner in which direct
impact over environment is drawn by business practices. In UK there are various
concerns which has been shown from government and these are linked with protection of

environment. This manner the company is having opportunities to ensure usage of such
processes and practices which are ozone-friendly in nature and may not induce any
damage to the eco system (Channon and Jalland, 2016).
All of these factors are required to have equal importance so that overall growth
opportunities can be inhaled by the organisation and in the same manner effective consideration
can be examined. Besides this in order to determine differentiated opportunities Porter's generic
model is also used as this will provide insight related to competitive edge. In the context of
Trading Scents this framework is explained as under: Cost Leadership: This is regarded as one of the most influential and appropriate strategies
in which the company would take step to compete with market rivals on the basis of cost.
In this manner with the help of this competition title of low cost manufacturer within the
industry. This is beneficial for the business to overcome from the market so that
appropriate conditions within the country can be examined. Besides this using this
strategy will lead the organisation to receive competitive edge. Differentiation: This strategy is associated with providing differentiated products which
may create differentiated demands in the market so that uniqueness can be attained. The
business is required to examine such dimensions which can be valued by their customers.
This is providing major advantages to the organisation in which at premium prices
products can be offered in exclusive manner (Burns and Dewhurst, 2016). In this manner
the company is required to involve some activities of market analysis so that they can
examine the gap between various products. Focus:This strategy is associated with competitive focus within the industry so that target
market can be catered and accordingly strategies can be used. This strategy is divided
into two other constraints such as: Cost Focus: Within this strategy the company try to gain advantage so that to attain target
segment within market on the basis of cost.

Differentiation Focus: Under this strategy product differentiation is subjected to target
market.
Out of the entire strategies Trading Scents is required to go for cost leadership as this
would be helpful for the organisation to engage new customers. This could be helpful in reducing

price of products so that new customers can be attracted using various channels of marketing and
promotion.Boston Consultancy Group Matrix
BCG matrix is defined as the approach which is associated with product portfolio and
helps in providing strategic planning to the business (Bosma, Sanders and Stam, 2018). This
matrix is prepared for analysis of growth planning so that to inhale opportunities and to gain
development as well. In the context of
Trading Scents this analysis is elaborated as under:
(Source:
How to use the BCG matrix model, 2020)
Dogs: This dimension of matrix is having such products or services those are covering
least market share. So that organisations are not required to focus on such offerings, for Trading
Scents their perfumed cosmetic products are included under this category.
Cash Cows: These products or services are associated with providing of higher profits so
that to gain appropriate market size. For Trading Scents their musk scents are top selling
products.
Star: This dimension is linked with such products those are having capabilities to make
more profits. In this manner fruity and beachy scents of Trading Scents are having highest profit
margins.
Question Mark: This segment of the matrix is associated with such product or services
those are having fear of losing of market share and for Trading Scents their natural fragrances are
taken under this category as market have huge number of competitors.

GE Matrix
This matrix was propounded by McKInsey and this is having 9 cell grids which could be
helpful in analysing attractiveness of overall industry. For Trading Scents this matrix is
elaborated as under:Invest/ grow: This is considered as the unit which is giving higher profits and provides market
opportunities as well. For Trading Scents the company is planning to invest into new range of
fragrances.Hold/ selective: This grid within the matrix is associated with question market product as these
products are having lower market growth. For this Trading Scents innovation and uniqueness is
required so that to gain market share.Divest/ harvest: This cell is having higher unattractiveness and related with dog category. For
Trading Scents the company is suggested to divest under this category so that to focus on some
other areas.
P2. Evaluation of opportunities for growth applying Ansoff's Growth Vector Matrix
As from the above discussion various growth opportunities are being inhaled as these
would be helpful in dealing with market condition effectively. Besides this this will be helpful in
gaining various opportunities so that growth opportunities can be inhaled and handled in more
appropriate manner. In this manner Ansoff growth in the context of Trading Scents is elaborated
as under: Market Penetration: Under this strategy the business introduces existing products in
existing market. In this manner the company ensures that to develop penetration strategy
in order to develop market share (Shtal and et. al., 2018). With the help of reducing prices
new customers can be attracted and at the same time market share of the organisation can
be enhanced. Product Development: Under this strategy new offerings will be developed by the
organisation within existing market. In this manner using this strategy Trading Scents
will undergo into extensive market research so that to take decision regarding product
expansion. Market Development: Under this strategy the company may sell their products into new
markets so that to gain diversified customers from range of market territory. In the

context of Trading Scents this strategy means the company is required to expand their
business in other markets than UK so that to maintain their commercial presence.

Diversification: This is one of the most risky strategy which can be adopted by Trading
Scents so that to enter into new markets along with brand new offerings. In order to adopt
this strategy potential synergies are required to be analysed so that linkage can be
established.
From the above discussion this can be analysed that Trading Scents is require to adopt
product development strategy so that to acquire higher customers and to modify their product
offerings.
TASK 2
P3 & D2. Assessment of potential sources of funding available to businesses
Funding is defined as allocation of financial resources in such a manner that growth
strategy can be implemented. Besides this for an organisation it is necessary to evaluate their
needed funds of finance so that maximum advantage can be attained by the organisation.
In the context of Trading Scents, the company has chosen cost leadership strategy along
with product development (Paurova and Gregova, 2020). In this manner the company is
launching their new range of scents which are made up of natural fragrances and these are not
providing any type of skin allergies to individual. In order to develop their product Trading
Scents is required to arrange funds using most effective source of financing. In this manner some
of the sources are elaborated as under:
Internal Sources of Funds:
These are the sources which are associated in internal manner so that can be used by
owners. Some of the internal sources are elaborated as under: Ownership Capital: This is regarded as one of the most prominent example of internal
source in which personal funds of owners are used. The major advantage of this strategy
is associated with time saving. Besides this the method may give financial burden and
additional working capital will have to be introduced.

Retained Earnings: This is regarded as another source of finance in which profits and
revenues are used by the company. The major advantage of this strategy is that there is no

interest due to which profits are not suffered. Besides this retained earnings may
minimise dividends of shareholders.
External Sources of Funds:
these are the sources which are existed in external manner and helps the organisation to
get access over plans. Some of the external sources are elaborated as under: Bank Loans: This is defined as most significant source of financing in which organisation
get their funding from banks. With the help of analysing business performance the bank
provides guarantee them loans (Aithal, 2017). The major advantage of this method is that
them method is safe and easy. On the contrary in terms of disadvantage interest is
required to pay which is a risk in long term.

Crowdfunding:
Crowdfunding is one of the trendiest strategy that can be used by businesses in order to
gain funds. This is the manner in which appeal is made to number of people so that to arrange
funds. In return these investors will get small portion in shares of the organisation. In this manner
in long term profits can be earned by these investors. The advantage of this strategy is that in
required quantity of funds can be gathered but at the same time this method is risky and lead to
an uncertainty of funds gathering.
M1. Options for growth
There are various methods that can be used by Trading Scents in order to get growth in
future period of time. Using porter's generic model the company may analyse external
opportunities existed within market (Matovic, 2020). This manner the company is able to inhale
various external aspects that could be beneficial for the organisation. Besides this with the help
of Ansoff best option for expansion can be analysed which could lead the company to attain
strategic market advantage.
M2. Evaluate potential sources of funding
By analysing all the factors and strategies this is being analysed that Trading Scents may
adopt bank loan as method of financing so that to launch their new product in the markets of
UK. This method could be helpful for Trading Scents as in comparison of other methods as the
method will lead the company to earn enough earning which will be adequate to pay bank
interest.

D1. Options and pathways for growth
There are various options and pathways that can be used for gaining growth within an
organisation. In the context of Trading Scents the company may have access over best possible
options that could be used by them. With the help of Ansoff matrix Trading Scents has
recognised that product development could be the best strategy for the organisation in order to
gain competitive edge (PAziri and Ismaili, 2020). Ansoff growth matrix is assisting in dealing
with various dimensions so that most suitable strategy can be selected which is providing easy
access to the business in terms of business expansion. In this manner Trading Scents may have
access to various plans of their expansion strategy. This is concluded that product development
strategy is one of the best method that can be used by Trading Scents for dealing with market
expansion plan and in this manner the company may have access to various market opportunities
as well.
PART 2
TASK 3
P4 & D3 Design a business plan for growth that includes financial information and strategic
objectives for scaling up a business
Business plan is defined as an official document which is associated with identification of
goals of the business for their expansion plan. With the help of this document strategic plan
within business can be prepared and at the same time within prescribed time goals and objectives
can also be attained. A business plan needed to be precise so that the same can be presented in
front of investors so that they can take decision related to investing money in the venture.
Business plan is a detailed inclusion which is helpful in controlling, monitoring and evaluating
various measures and could lead into executing functions in effective manner along with gaining
improvements as well (Islami, Mustafa and Latkovikj, 2020). In order to receive such succession
opportunities within objectives Trading Scents is preparing to develop business plan in which
objective, vision, mission and purpose of the business can be attained.
Section 1: Executive summary
Trading Scents is a whole seller which is engaged in supplying of scents and cosmetics
products within market. The company is willing to provide one stop solution to people so that
they may shop desired cosmetics and fragrances in appropriate manner. The company is willing

to provide innovative experience in relation to fragrances. In current time this is being observed
that people are inclined towards using of such cosmetics and fragrances products. The company
was incorporated in the year of 1992 and various issues are being faced within the organisation
as in relation to sales and profitability.
The strategic objectives of the business are associated with earning of higher profitability
by expanding their business. The strategic objective of Trading Scents is to introduce some new
fragrances into the market so that to meet their business objectives and to deal with several
issues. Besides this the company is willing to manage strong relationship with their client so that
to gain their loyalty.
Section 2: Owner’s background
Trading Scents was incorporated in the year of 1992 and due to decision of Brexit
decision the company started to face issues in dealing with market trends. In this manner now the
company is initiating to introduce various new fragrances so that to place their business in most
appropriate manner and to attract numerous customers.
Section 3: Products and services
Trading Scents is associated with supplying various types of scents and other cosmetic
products to their customers. In this manner the company is highly focused into developing
market insights and analysing market condition so that they can acquire new proceedings and
develop their market share. In order to acknowledge market condition the company is preparing
business plan which is elaborated as under:
 Vision: Vision of Trading Scents is to deal with business complexities so that they can
empower their business and manage status quo as well. On the other hand the company is
trying to develop positive aspects in their business so that errors can be eliminated and at
the same time prominence can be attained.
 Mission: Trading Scents is associated with supplying of various cosmetic products and
different types of scents and in this manner the company is trying to meet market
demands. Besides this the company is planning to attain their mission of business
expansion and to create value within the market.
 Strategic objectives: Trading Scents is working for the major purpose to enhance their
profitability by 20% within 2 years. This manner Trading Scents is managing overall
transparency and differentiated aspects in their business.

 Financial information: This is defined as analysing various financial capabilities so that
by using available resources. In this manner the company is using external sources of
finance for availing of funds and to attain their objectives.
Section 4: Competitors analysis
Competitors analysis is defined as the process which is utilised by the organisation so that
to analyse position of their rivals and to examine level of competition as well. Trading Scents is
associated with dealing of fierce competition so that for dealing with the same appropriate
strategies are required to be made. JHR holdings, BSB Global Limited are the major competitors
of Trading Scents. The company is required to to inhale aggressive competitors strategies so that
they can promote their products in the market and gain market position as well.
SWOT analysis of Trading Scents
Strengths Weaknesses
 The company is having prominent
market position within UK and due to
which the company is able to maintain
their market prominence (Erboz,
2020).
 Trading Scents is offering wide range
of products in the range of cosmetic
sector which is able to provide them
appropriate market image.
 Trading Scents is facing fierce
competition in the market and for
gaining prominent market image the
company is needed to gain accurate
brand publicity.
 Cost of maintenance is very high for
the organisation due to which
operational problems are being faced
by the organisation.
Opportunities Threats
 Trading Scents is having immense
opportunities to expand their business
by introducing new product segment
or by launching some more fragrances
as well.
 The company is having opportunity to
attract higher customers.
 Trading Scents is facing major issues
which are related to competitors as
they are also associated with similar
product offering.
 Due to decision of Brexit various
issues in management.
Section 5: Marketing strategy and pricing
A marketing strategy is associated with suggesting of such plans in which potential
audience can be converted into customers. In the current time Trading Scents is associated with
cost-effective strategy so that to place their offerings in most effective manner. Besides this the
company is using competitive pricing as well in order to deal with their rivals and to attain