Strategic Growth and Exit Planning: A Report for Better Health Bakery

This report examines growth strategies and exit planning for a small bakery, Better Health Bakery. It analyzes key considerations for evaluating growth opportunities, including the use of the BCG Matrix and McKinsey 7-S Framework. The report evaluates growth options using the Ansoff matrix, focusing on product development. It also explores sources of funding available to businesses and designs a business plan for growth, including financial information and strategic objectives. The report concludes by assessing exit or succession options for a small business, explaining the benefits and drawbacks of each option. The report provides a comprehensive overview of strategic planning for business growth and sustainability.

42 – Planning for
Growth

Table of Contents
INTRODUCTION...........................................................................................................................................3
Investing in the Future (Part 1)....................................................................................................................3
TASK 1..........................................................................................................................................................3
Analyse key considerations for evaluating growth opportunities............................................................3
Evaluate the opportunities for growth applying Ansoff growth vector material.....................................5
Options for growth using a range of analytical frameworks....................................................................7
Critically evaluate specific options & pathways for growth....................................................................8
TASK 2..........................................................................................................................................................8
Sources of funding available to businesses.............................................................................................8
Evaluate potential sources of funding & justification..............................................................................9
Critically eevaluate potential sources of funding with justified argument..............................................9
TASK 3........................................................................................................................................................10
Design a business plan for growth that includes financial information & strategic objectives for scaling
up a business.........................................................................................................................................10
Develop an appropriate & detailed business plan.................................................................................16
Present a coherent and in-depth business plan....................................................................................17
Developing an Exit Plan (Part 2)................................................................................................................17
TASK 4........................................................................................................................................................17
Assess exit or succession options for a small business explaining the benefits & drawbacks of each
option....................................................................................................................................................17
Exit or succession options for a small business......................................................................................18
Evaluation of the exit or succession options for a small business.........................................................19
CONCLUSION.............................................................................................................................................19
REFERENCES..............................................................................................................................................20

INTRODUCTION
Every organization required to prepare effective plan so that they can maintain the
effective performance by which they can enhance the overall growth of the company. Planning is
analysed as the most influencer process by which they can increase the productivity and
profitability of the business. There is different type of business such as startup micro small
medium and large scale business and every organization emphasize on preparing strategic
planning by which they can enhance the overall success of the company. Strategic planning is
important by which taken recognize their brand in the large market. Better health bakery which is
the social enterprise bakery that is based in Haggerston, London. Now the company is planning
to do new product development in which they introduce the bakery cup cake with the addition of
sweet potato so that the immunity system of the individual can be boosted. This report will
analyze growth opportunities and using and Ansoff growth vector matrix in order to analyze the
growth opportunity in the new market.
Investing in the Future (Part 1)
TASK 1
Analyse key considerations for evaluating growth opportunities
It is important for the all firms whether it can be small or medium format require effective
planning for their growth. In order to sustain at the whole market, organization are using specific
model by which they can have the appropriate opportunity for the development and growth.
After the impact of Brexit uncertainty, there are various business which get affected in the
United Kingdom and the companies looking forward in order to effective planning for their
development and better health bakery planning to use the specific model so that they can expand
their business and enhance the growth rate. The bakery is using different model such as BCG
Matrix and McKinney model. These models are explained as follows:
Boston Consultancy Group Matrix
BCG matrix is considered as an effective planning tool that helps in graphical representation
of product and services by which the company can also analyze the investment inventory and
other resources within the organization. This is also known as growth matrix that is helpful in
providing growth opportunity to the firm. This Matrix includes the four elements which are dog

cash cow, star and question mark. All these elements are evaluated on the basis of market growth
and market share as per their low and high criteria. Veterinary cream is using this Matrix in order
to analyze the growth opportunity and growth status which is being explained as follows:
 Dog - . It is the stage which contains that product of the company watch low market
growth rate and having low market share in comparison to their business in the
marketplace. It is not necessary to invest in the business because they are generating low
cash returns and it is the fact that some dogs can be good for longer period of time as they
can provide some synergies for another brand. The strategic choice of this stage is
retrenchment, liquidation and divestitures (Cleberg, 2019).
 Question Mark - this stage is also known as problem child who is related to the growth
rate of the product is high and the having low market share. Basic? Require consideration
as they contain low market share for the growth which is consuming high amount of
money and include losses. Strategic choices are considered as a market penetration,
market development and product development.
 Star - it is the stage which is related to the aspect in which high market growth rate and
high market share is there and star comes in both the categories like cash user and
generator. Strategic choice of these days is vertical and horizontal, market and product
development (Deng, Ma and Zhang, 2017).
 Cash cows - it is also called as Milked because it is considered as the most profitable
brand it determines the low market growth rate and high market share. Organization
received cash from the cows that invested into stars in order to provide support for their
future.
McKinney 7 S Framework
It is the framework that is management model h s bean introduced by the Robert H.
Waterman & Tom peters in 1980. It is the important model which helps in enhancing the overall
effectiveness of the organization that includes the seven factors which needs to be aligned and
reinforcing according to the success of the company. These elements are divided into two parts
like soft element and hard element which are explained as follows:

Hard elements
 Strategy - It is the important element which help in providing strategies for making the
organizational plan by which the company can maintain their specific position in the
market and also achieve competitive advantage. Structure - The main concern of this element is to determine how the companies organize
their structure which includes team department that can helpful in attaining the
organizational goal. Companies follow the organization structure so that all the
applications can be effectively of treated with proper consideration of rules and
regulation (DODDS, DIMANCHE and SADOWSKI, 2018). System - the element which define that all the time are performed in a systematic manner
so that employees can do their job with the consideration of discipline and establish
effectiveness in their working.
Soft elements
 Shared value - these are the elements which are related to the culture in which all the
employees are share their specific values and respect each other believes and thoughts.
Organization needs to maintain all the ethical consideration within the workplace.
 Skills - as per this skill, it is evaluated that there must be proper skills and competencies
associated with the employees so that they can contribute in improving the market growth
of the company. Style - It is the element which is concerned with the leadership style which is been
adopted by the business. All leadership style, participated democratic supportive leader
style are usually followed by the leader.
 Staff - the main focus of this element it's to consider their employees and their skills so
that the company can effectively established good brand image in the market which
contribute in the growth and development of the company (Friedmann, 2020).
Evaluate the opportunities for growth applying Ansoff growth vector material
As per to achieve more success, there is a requirement of specific opportunities so that
businesses can effectively consider the growth of their organization. Entrepreneur need to pay
more focus on their internal & external operations which can help full to generate more

opportunities for the development of the company. Better health Bakery is small social enterprise
which operates their business in London and also providing high quality of services to their
potential customers. Due to the uncertainty of the corona pandemic, bakery performance
fluctuate so now the main target of Bakery is to rebuild their market position so that Bakery can
effectively maintain all the losses of the pandemic. To analyze specific growth unfortunately
bakery need to follow Ansoff Matrix model there are four strategies are includes in this model
which are discussed below -
 Market Penetration - The main concern of this growth strategy is use existing goods &
services into existing marketplace. With the help of this growth strategy, businesses can
effectively obtain high level of market growth rate. This strategy is more beneficial for
the small enterprises because it requires low cost rate & less rime (Gu alini, 2018).
 Market Development - The prime motive of this growth strategy is to utilize existing
goods & services to enter into new market. This strategy is helpful for the business
because company use existing goods & services which are already considered strong
positioning at the whole marketplace so it is easy for the company to accomplish more
market growth rate. This strategy is beneficial for the business expansion so that
company can effectively gain more profitability & reorganization into the new market
place.
 Product Development - This strategy determine the launch new goods & services into to
existing marketplace. This strategy is useful to create influence brand value of the
enterprise. Better Health Bakery can consider this growth strategy which can help full to
improve the level of market share & also market growth rate. Better health Bakery
conduct specific market research and generalized that there is a requirement of innovative
product which can help you to provide various health advantages to the people of the
London. Bakery conduct market research and analyze that new product and development
is a great growth opportunity for the bakery so now company decided to produce specific
innovative product that is cupcakes prepare with the organic & healthy ingredients & also
use sweet potato which can help full to boost the immune system of customers. This
product development strategy considered as the big development opportunity for the
bakery to evolve their productivity & profitability.

Figure 1Ansoff Matrix: Understanding firms’ growth options,2021
 Diversification - On the basis day of this strategy, company can introduce new goods &
services into new market. The risk factor is more in this strategy because it required more
investment because product and services and also market totally new.
On the basis of above discussion about the four strategies of the Ansoff Matrix model, it is
generalized that product development strategy it is considered the most reliable growth strategy
for the Better Health Bakery. This strategy is helpful to provide launch new innovative product
opportunity for bakery (Hu, Huang and Li, 2019).
Pros and cons of the Ansoff Model
Pros - This model can mainly concern about the focused approach which can help to develop the
specific strategies to maintain key elements which can help to drive the sales, determine the
growth. This model is more concerned growth potential which is also big advantage of this
model.
Cons – This model contain the isolation approach which affects the market development. This
model mainly concerned about the theory but do not apply practices.

Options for growth using a range of analytical frameworks
To attend long term growth at entire marketplace, there are numerous options for growth are
available. In context of Better Health Bakery, Ansoff matrix applied and it is evaluated that in all
these four strategies of this matrix, product development it is more beneficial for the bakery
which provide high level of growth. Bakery also can contain other options for growth like
SWOT analysis, porters five force model, strategic group techniques & growth share matrix. All
these models are considered as the analytical framework which can determine most possible
growth opportunity for the bakery in order to improve market growth rate.
Critically evaluate specific options & pathways for growth
There are various options for growth used by the Better Health Bakery to gain opportunities
for the development. Some specific options & pathways for the growth which Bakery considered
like Ansoff matrix , BCG matrix, McKinney framework all these growth options are the most
appropriate analytical Framework which can help full to determine the certain risk and also
provide specific opportunities so that bakery can effectively e gain more growth opportunities as
compared to their competitors. Without applicability of all these growth options, it is critical for
the bakery to consider most appropriate growth opportunities for the development of the
business.
TASK 2
Sources of funding available to businesses
To arrange funds from the various source of financing it is necessary for the owner of the
business to consider investment decision techniques. Basically investment decision is help the
investors so that they can effectively take decision about the funds to be deployed in investment
opportunities. Investment decisions can be taken for the long and short term period of time with
the help of capital budgeting & working Capital Management. For the long term investment
decision, company need to consider capital budgeting method. There are various techniques are
involved in capital budgeting and in all these techniques payback period and net present value
considered the most appropriate techniques for the specific projects. In case of payback period, it
mainly determine the specific time period which require earning initial investment of project

(Kinossian, 2018). In context of Net present value, it mainly calculates in term of the currency
and it determine the difference between the present value of the cash inflows & present value of
the cash outflow on a specific time period. In order to consider most appropriate source of
funding for the Better Health Bakery, the explanation about various sources of financing are as
follows -
 Bank Loan - This financial source is helpful for the entrepreneur & businesses because
people can take bank loan for long and short term period both. Bank loan also charges
low interest rate so it is suitable for the owner of the business to opt bank loan for
finance. The main advantage of bank loan is that it is convenient for entrepreneur who
can repay the amount on a specific period of time. The main disadvantage of bank loan is
that it require specific security and also acids against loan amount. If entrepreneur are not
able to repay loan on deadline then property can be taken by the bank. Better health
Bakery can consider the source of finance for their new project (Rudolf, Kienast and
Hersperger, 2018).
 Angel investors - It is also called as business angels, it determined those investors who
are containing high net worth and also so willing to invest in the new project and business
without containing any kind of personal family connection. Angel investors are mainly
investing on the business with the motive to take the equal portion of the business.
Investors provide large number of funding in the project this is considered the main
advantage of this financial source. It require more time to identify most appropriate
Angel investors for the business it is considered the main disadvantage of this source.
 Venture Capitalist - This source of finance work as a financial intermediaries &
considered as the non banking financing in which venture capitalist provide capital to
support the SMEs for the specific project & business expansion. Strategic planning &
proper decision making is the main advantages this & overall financing cost is very
expensive this is the main disadvantage of this financial source. Leasing - This is also a good source of finance & also considered as the assets based
finance that can provide small & medium enterprise a short & long term financing. This
type of financing contain procurement of the capital equipment in which two parties are
involved & sign an agreement, where one party responsible to provide assets to another

party for utilizing that assets on a particular time period against the specific regular
payments. In last period of agreement, lessee is mainly allowed to purchase that
equipment. Trade credit - It is like an another way to fulfill the financial need. Trade credit involved
when a business can purchase specific product and services on a deferred amount of
payment. It is like a short term credit & payment because due to in the 30 to 60 days of
the payment is not appropriately mad on the specific time period then interest charges can
be imposed and also become the specific source of finance. Basically, trade financing is
universal rather than conventional bank leading. SME Owner friends & family - This kind of financing is basically known as the source
of capital in which SME business owner arrange funds from their friends and family
when owner are facing adverse situation in their business. Friends and family e are
considered as the trusted source of capital so that owner can arrange finance effectively
anytime as per the requirement of the fund. This source of finance is more convenient for
the owner so that company can take funds from their friends and family for suitable
period of time. Better health Bakery can consider this source of finance for the growth of
their business.
Evaluate potential sources of funding & justification
There are numerous sources of funding which can be considered by the Better Health
Bakery like bank loans, Angel investors, venture capitalist. All the sources of financing contain
specific benefits & drawbacks and after that it is generalized by the owner of the business that
bank loan considered the most applicable and suitable source of funding. With the help of bank
loan, Bakery can take long term loan for their new project with a low interest rate. Better Health
Bakery main concern is to provide healthy food to the people & also improve quality in their
food items so that bakery can attract the customers. Fir their new business plan , Bakery owner is
looking forward to take bank loan & also arrange some funds from their friends & family so that
owner can effectively maintain proper utilization of the financial resources in their business.
Critically evaluate potential sources of funding with justified argument
Some appropriate sources of funding contain by the Batter Health Bakery like bank loan,
Angel financing & venture capitalist. In all these sources, bank loan is opt by the bakery because

it can more convenient for the business & also provide long term funding. Without this source of
finance, it is difficult for the bakery to arrange huge funds at a time because is mainly provided
by government & other corporations & foundation are not easily trustable
TASK 3
Design a business plan for growth that includes financial information & strategic objectives for
scaling up a business
Business Plan
Executive Summary
In this modern era, businesses are facing various competitive situations which provide
direct impact on the working & performance of the business. Better Health Bakery is the
Charitable Artisan Bakery This enterprise looking forward to produce a new innovative product
which will help to evolve the sales of this Bakery. Due to covid pandemic, bakery experienced
numerous adverse situation so now bakery trying to produce something new & innovative so that
bakery can specifically add healthy ingredients in their new product which will aid in improve
the immune system of the people so that they can take advantages of their product & enjoy
delicious food with lots of health benefits (Schatz, 2017).
Company overview
Better Health Bakery is a social enterprise Bakery which mainly based in Haggerston,
London. This social enterprise is the part of the centre for Better Health, Hackney based mental
health charity. This artisan bakery also providing placements to the adults who recovering from
the mental I'll heath. Bakery is offering diversified products to their customers and also
maintains good quality in their food items. Mission - To enhance the brand image, bakery maintain good quality of their products
& services.
 Vision - To generate employment for those people who are trying to improve their
mental health and want to become self dependent. Objectives - To engage with more people which can help to increase the market position
& customer loyalty.

Financing Summary
Better Health Bakery is trying to come up a new and innovative product which can improve
their market value & maintain long-term sustainability level at the whole market place. For the
financial purpose related to the new innovative product ( Cup cake add Sweet potato for the
immunity boost prupose) . Bakery need to consider some specific key assumptions related to the
income sources, projected investment in the equipments & materials, rent & rants charges,
promotion charges, number of employees engaged with new project & many more. All these
factors are contained by the bakery manager & then prepare a proper budget. The description
related to the new product development expenses are determined below-
Particulars Amount (£)
Human resources expenses 1000
Equipments & materials 900
Promotion activities expenses 700
Research & development 500
Total 3100
Industry and Market Analysis
In order to innovate new product, it is necessary to conduct market analysis which can help
to consider the whole market situation. For market analysis, Better Health Bakery needs to
conduct market research which can help to identify the current requirement of the customers &
also useful in generalization the current situation of their Competitors. There are certain steps are
involved which need to focus are as follows -
Target Market - Bakery decide to target the London people and bakery also consider the
demographic & geographical segments which can help to target the audience more effectively.