Unit 42 Planning for

Growth
Contents
INTRODUCTION...........................................................................................................................1
TASK...............................................................................................................................................2
P1 Analyse key considerations for evaluating growth opportunities.....................................2
P2 Evaluate the opportunities for growth applying Ansoff growth vector material..............4
M1 Options for growth using a range of analytical frameworks............................................6
D1 Evaluate specific options &pathways for growth.............................................................6
P3- Potential sources of funding available.............................................................................6
M2 Evaluate potential sources of funding and justification for the adoption of an appropriate
source of funding for a given organisational context.............................................................8
D2 Critically evaluate potential sources of funding with justified argument for the adoption of
a particular source or combination of sources, based on organisational needs......................8
P4- Designing a business plan for growth..........................................................................8
M3 Developing an appropriate and detail business plan for growth and securing investment,
strategies...............................................................................................................................10
D3 Present a coherent and in-depth business plan that demonstrates knowledge and
understanding of how to formulate, apply and achieve business objectives successfully.. .10
P5 Assess exit or succession options for a small business explaining the benefits and
drawbacks of each option..................................................................................................11
M4 Evaluate exit or succession options for a small business comparing and contrasting the
options and making valid recommendations........................................................................12
D4 Providing critical evaluation of exit or succession options for small business..............12
Conclusion.....................................................................................................................................13
REFERENCES..............................................................................................................................14
INTRODUCTION
The organization's growth necessitates the development of a business and strategic plan,
which is the most important aspect of the economy. Growth planning is a planned business
activity that documents how business owners plan and track revenue growth. The limited
resources are directed toward the central determination for adjusting changes in the business
gripped by digital trouble and distinguishing itself from competitors. Strategies and policies are
elaborated in the growth plan, which is a critical component in profit generation and customer
satisfaction. The growth strategy includes the fundamentals of the business in order to
demonstrate its worth to clients. There are various types of businesses operating, such as start-
ups, micro, small, medium, and large scale businesses and each business must place an emphasis
on strategic planning in order to improve its growth rate (Butler, 2019). The proposal is in place
for a period of 3-5 years. The businessperson also investigates the internal and external
environmental factors that have an impact on the company. The discussion in the study is based
on the key considerations for growth evaluation using the Boston Consultancy Group Matrix and
Ansoff Matrix. The SME's funding sources have been identified, and a business plan and
succession plan have been developed. The research is being conducted on the Marshfield bakery,
a small-medium enterprise founded in 1984 that specialises in the production of quality
handmade cakes, biscuits, and seasonal goods. Dyrham, Chippenham, United Kingdom-based
company looking to expand.

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TASK
P1 Analyse key considerations for evaluating growth opportunities
It is necessary for each and every enterprise, whether small or medium-sized, to have a
specific plan for growth. Companies are implementing specific models and frameworks in order
to sustain themselves across the entire market, which will provide them with appropriate
opportunities for growth and evolution. Most businesses in the United Kingdom have suffered as
a result of the Brexit uncertainty, and companies are now looking forward to conducting specific
planning for development and growth (Cleberg, 2019). Marshfield Bakery also intends to employ
a specific model that will aid in the expansion of their business and the rate of market growth.
Marshfield Bakery is considering models such as the BCG Matrix and the McKinney framework
for future growth opportunities. The differences between the two models, as well as specific
recommendations, are discussed further below:
Boston Consultancy Group Matrix

Boston Consulting Group can be defined as the growth share matrix which is consider as
the tool for planning as it represent the products and services offered by the business
organisation through the use of graphs. This model, also known as the "Growth Matrix," is useful
in providing opportunities for the company's growth. There are four elements involved: a dog, a
cash cow, a star, and a question mark. All of these elements are determined by market share and
market growth level in accordance with the high and low performance criteria. Marshfield
Bakery employs this matrix to analyse growth status and generalise growth opportunities. This
matrix's explanation in the context of Marshfield Bakery is discussed further below.

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  Dog: This phase comprises the firm's goods that have a low growth in the market and a
low market share in comparison to their business in a slow growing marketplace. It is not
necessary to invest in businesses because they already generate low cash returns
(Dadashpoor and et. al., 2018). It is true that some products can be consider in dog
category for a longer period of time and they can include some efficiencies for other
brands. Biscuits offered by Marshfield bakery is the product which comes under this
category.
 Question Mark: This phase, also known as "problem child". It occurs when the product's
market growth is high but its share of the market is low. Primarily, question marks
require more thoughtful thought because they have a small market share in a rapidly
growing market, consuming a large amount of money and incurring losses. Market
penetration, product development, and market development are all strategic options to
consider. Marshfield bakery offer buns which has high market growth and less market
share.
 Star: This stage is demonstrating a high rate of market growth and managing a large
market share. Stars are divided into two types: cash generators and cash users. Although
it is expected that starts will generate positive cash flow, not all stars will generate cash
flow (Dengand et.al., 2017). This stage's strategic options include vertical and horizontal
integration, market development, and product development. Cakes offered by Marshfield
bakery are the products which help the organisation in earning higher revenue.
 Cash cows: It is also recognised as "Milked" because it is regarded as the most valuable
brand, capable of assisting in the distribution of as much money as possible. It determines
the market's low growth rate and high market share. Companies received cash from the
"Cows" who invested in the "Stars" to support future growth. This stage's strategic
options include recession, diversification and disposals. Muffins by Marshfield bakery
comes under this category of BCG matrix.

P2 Evaluate the opportunities for growth applying Ansoff growth vector material
The Ansoff Matrix is an important tool for evaluating specific opportunities for evolution and
growth. This matrix functions as a strategic planning technique, assisting in the maintenance of
all operations for future use. This model is being used by the Marshfield bakery for the purpose

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of expanding their business operations and overcoming from the Brexit losses. The following is
an explanation of this model based on four strategies.
 Market Penetration - The primary goal of this growth strategy is to sell existing goods
into existing markets. This strategy will determine a high market share and growth rate
(Hoffman and et.al., 2018). This strategy will help the bakery's development because it
requires a low cost.
 Market development - This growth strategy is beneficial for introducing existing
products into the new market and increasing the effectiveness of the bakery in the new
market. This expansion strategy necessitates more investigation in order to identify the
needs of the new target audience. Marshfield Bakery employs this growth strategy for the
purpose of improving their business functions at several locations throughout the United
Kingdom which resultn increase profitability and market growth.
 Product development - This strategic tool is useful for launching new products into the
existing market. The primary goal of this strategy is to boost the company's growth rate
through product changes. This strategy is advantageous in terms of gaining a large market
share.

Figure 1Ansoff Matrix: Understanding firms’ growth options,2021

 Diversification - This one is the last growth strategy demonstrates product

diversification. This strategy defines the introduction of new products into the new
market. This strategy is thought to be very risky and will necessitate additional
investment for business expansion with new products.

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According to the assessment of this strategic plan, it can be ascertained that, of the four Ansoff
Matrix growth strategies, Market development is more suitable for the Marshfield Bakery and
can help to enter new markets with existing products and services . through the use of this
strategy, the respective business organisation can enter in the new market and offer the existing
products to the customers. The management is already aware about the preferences of one
market which can also help in analysing the taste and preferences of other markets as well.

M1 Options for growth using a range of analytical frameworks

There are several options for growth, which majorly help the organisation in
maintaining the effective position and gaining higher positive outcomes. According to the
previous discussion, the Marshfield Bakery has generalised some specific growth options such as
the BCG Matrix and Ansoff matrix, all of which work as an analytical framework to boost the
bakery's performance and aid in gaining more market growth and market share than competitors.
Each of these strategic options are beneficial in providing various opportunities for growth,
allowing the bakery to effectively evolve their business following the uncertainty of Brexit .

D1 Evaluate specific options &pathways for growth

Marshfield Bakery evaluated various options for growth planning, rebuilding their market
structure and improving their performance following the negative effects of Brexit. The
Marshfield Bakery is planning to expand their business functions in the other remaining part of
United Kingdom as it will result in the higher profit generation and revenue. Bakery can
effectively enter a new market with their existing products using Ansoff's matrix strategy
"market development." This planning is regarded as the most appropriate for growth and suitable
option, as it provides specific pathways for expanding business activities into other locations.

P3- Potential sources of funding available

To run the business effectively, the company requires specific funding. The funding is the
arrangement of money that helps in funding to have long-term success in the business operation
that is required when the business expands or diversifies. Through funding, it increases
profitability and productivity. In the context of the Marshfield bakery, there are numerous
sources of finance, which are classified as equity and debt funding. These are the sources:-
 Bank loan- It is the most important way to increase the fund in terms of loan provided to the
small-medium business. The company obtains the loan by meeting certain minimum criteria

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 set by the bank, and it is also repayable at the interest rate set by the bank. The loan can be
used for both short-term and long-term purposes (Hu and et.al., 2019). Working capital, term
loans, and property loans are the three types of credit available. In the context of the Marsh-
field bakery, it is advantageous to raise funds at a fixed rate of interest.

Benefits- It is simple to obtain a loan with a fixed interest rate, and it does not take profit or
company share while paying interest. The loan can be obtained based on the need and will be
repaid in the future.
Drawback- Obtaining large loans necessitates the fulfilment of certain terms and conditions
that do not allow for flexibility. The loan is granted in exchange for security, which can be
taken away from the borrower if the payments are not made on time.
 Crowd funding- It is a new deliberated method of obtaining funding. Borrowing money is
obtained from a large number of people in order to increase the amount of funding. The
funding is raised by a small amount for the project, which is a good source of income for the
Marshfield bakery. It is accomplished through the use of social media or a crowdfunding
website, where the entrepreneur and investor collaborate to increase funds.
Benefits- It provides quick sources of finance to grow where progress is tracked by the
investor to promote the brand. The project's target amount is set to raise funds.
Drawback- The financial support of the funds is not suitable for all types of projects, and
project failure harms the firm's reputation (Kinossian, 2018). If the targeted amount is not
attained up to a certain amount, the investor can return the money and the company is left
without anything.
 Own capital or savings- It is an easy source of finance for small businesses to raise funds
because the good businessman can obtain funds when capital is required. Individual savings
in cash or private assets such as stock, mutual funds, jewellery, and real estate are used to
raise funds. In addition, the businessman acquires credit or sells assets to raise funds.

Benefit- In the case of the Marshfield bakery raising funds, no interest is charged and no
payment plan is required (Mueller and et.al., 2018). It is a simple and effective way to secure
and access funds.

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 Drawback- The disadvantage is that it creates the risk of failing to meet the individual
requirements. It necessitates the primary investment by putting personal finances at risk,
which can result in the loss of all savings.
 Angel financing- It is also regarded as the most important source of finance because in-
vestors invest in order to gain an equal position in the organisation. This funding also aids in
the provision of specific guidance and recommendations in the context of the Marshfield
bakery.

Benefits- The primary advantage of this source is that the organisation can admit the precise
knowledge and also come to an agreement with the stockholders regarding the funds. It also
aids in the making of quick investment decisions (Mazzarol and et.al., 2020).
Drawback- The disadvantage is that the organisation gives the investors shares, and it takes a
long time to find a suitable angel investor.
According to the discussion above, all of the sources are beneficial and important for raising
funds in the context of the Marshfield bakery. The most effective are bank loans and personal
capital savings, which allow for the acquisition of required amounts of resources.

M2 Evaluate potential sources of funding and justification for the adoption of an appropriate
source of funding for a given organisational context
From above it can be analysed that, there are a variety of funding options available to
help in company growth. In the case of Marshfield Bakery, bank loans and own capital savings
are the main sources of funding (Garnaut, C., 2020). The main reason for choosing this method
of funding was that it provided the freedom to take a bank loan with a low interest rate for short-
term or long-term purposes. The money for own capital savings is raised to the required level by
taking personal savings or selling any assets.

D2 Critically evaluate potential sources of funding with justified argument for the adoption of a
particular source or combination of sources, based on organisational needs
The company has several sources of funds to expand the business which help in
providing the financial stability to perform well for the business. There are several funding
options available, including bank loans, angel financing, crowd funding, and personal savings.
All sources are good for business and provide the best services. However, each source has some
advantages and disadvantages that would be beneficial for Marshfield Bakery.

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P4- Designing a business plan for growth
The business plan is prepared by every organisation which describes the written
statement of business for future with the aim of defining market position & approaches,
strategies. In context Marshfield bakery number of task can be done with help of business plan as
it provides direction to perform operations effectively. The business plan comprises of several
elements which are as follows in context to Marshfield bakery (Jawaid, and et.al., 2018).
Executive summary- The business plan is prepared for defining company goals which
serves as company roadmap to track business and ensures operations growth. The business plan
is prepared for Marshfield bakery which is located in UK that offers hand made products to
customers such as cakes, biscuits and many more. It will discuss company vision, strategies to
enhance business performance and competitive advantage.
Business description- The Marshfield bakery deals in hand made product which has
mission to offer best quality of baked goods and create such atmosphere that helps in attracting&
retaining the talented people in company and customers. The bakery vision is to develop
innovative products from chemical free baking products. The objective is to enhance brand
positioning to gain market share and productivity. By offering high quality items to customer as
to make them happy. The company offers varieties of products and services to customer of baked
good which are hand-made such as cakes, biscuits and many more along with clean & hygiene
atmosphere to sit, great customer service (Nogués, González-González,. and Cordera, 2019).
Market analysis- To attain the objective of business it involves the analysis of STP in
context to Marshfield bakery. The segmentation is based on the basis of demographic income
population and geographic basis. It will segment the market according to age group. In targeting
Marshfield bakery will target to upper- and middle-class customer for offering quality handmade
baked products. The company will position itself by creating a distinct image in consumer minds
as this emphasis on the quality and hand-made features to make product of best quality.
In the market the bakery face competition from other bakeries in same industry to have
competitive analysis it involves SWOT analysis to known about the competitors. The baker has
strength in terms of offering high-quality products which are hand-made, good brand image in
public, creating brand awareness to large customer base and posses high talented workforce. The
bakery has low fan following on social media which is weakness and affected with the external
factors of government policies. In context to Marshfield bakery, it has opportunity of launching

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new products and expand its business. to attract families, it can brand its products towards kids.
The bakery can face threat from several competitors dealing in same industry and change in
choices & preferences of customer.
Marketing and sales strategy- In context to Marshfield bakery it will make use of
several promotional marketing tactic of marketing mix which involve 4Ps. Product- In context
to Marshfield bakery it provides verities of hand-made product to customers with best quality
and good in taste that helps in attracting large customer base (Olesen, K., 2017). Price- This
involves price paid for product by customer. The bakery will set its price according to
competitive anon penetration pricing for attain competitive advantage. Place- The products will
be offered at location where it can be easily accessible to customers like stores on online.
Promotion- To promote the product it will take use of several promotional technique such as
digital marketing, social media marketing, advertisement, personal selling etc. The sales strategy
is plan by the Marshfield bakery for achieving the sales goals as sales is crucial for the business
success. This helps company in selling products & services in order to generate and increase
revenue. The Marshfield bakery will make sales strategy to differentiate from the competitors by
developing value propositions (Ouyang, and Li, 2018).
Financial plan- The company will prepare budget where all the expenditure and incomes
are recorded in order to use the funds effectively. The income statement, cash flow statement and
balance sheet are prepared for knowing the financial position. The bakery will also evaluate
several sources of funds for having adequate funds for future use.
Monitoring and controlling- Monitoring and controlling are techniques for tracking,
reviewing, and regulating the project's progress and performance. The proposal reviewed using
the prior sales so that action can be taken to alter the dissimilarities in the plan to raise the market
share and productivity. The market share study is used to determine the participants' share in the
Marshfield bakery market (Pendleton, and et.al., 2017).

M3 Developing an appropriate and detail business plan for growth and securing investment,
strategies.
From the business plan it helps company in determining objectives and to remain on track
for meeting goals. In context to marsh filed bakery it follows a set of procedures to build a
business plan that maximises resource use. The company's business plan aids in the detailed
knowledge of the company's objectives. The market is examined and financial projections are

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made in the company's strategy. It also assesses potential funding sources for future needs. For
foreign expansion, the organisation also examines internal and external issues as well as its
growth strategy.

D3 Present a coherent and in-depth business plan that demonstrates knowledge and
understanding of how to formulate, apply and achieve business objectives successfully.
The company takes a few actions to keep a thorough understanding of the business plan
by formulating them to meet the company's goals (Ramseur, and et.al., 2018). These procedures
are necessary for determining the business description, market study, marketing and sales plan,
funding request, and financial predictions. Marshfield Bakery follows these stages to
successfully implement the business plan by examining numerous micro and macro elements as
well as the growth strategy. The business plan provides several benefits to company such as
enhancing of brand image, increase of profits, creates market roadmap etc.

P5 Assess exit or succession options for a small business explaining the benefits and
drawbacks of each option
It is critical for the firm to consider specific possibilities, such as business exit strategies
or succession ideas, while estimating the current market environment. This choice aids in the
successful decision-making process for business growth and succession planning in case of
Marshfield bakery. There are several exit and succession options in context to bakery which are
as follows-
Selling firm in open market- This entails the transfer of all of the company's rights and
duties to someone else in the market, rather than a single consideration. Instead of closing the
firm totally, the proprietor will change (Sutduean, and et.al., 2019).
Benefits Drawbacks

It is beneficial as the employees already exist When it comes to marketing, a little estimate
and are familiar with their behaviours, the is possible. In order to boost efficiency, the
new owner can simply carry on with business organization may face a shortage of qualified
operations. people.

Liquidation: This is the point at which the plan becomes more specific. A comforting
method has also been used in the asset auction, which began with the payment of all

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responsibilities and debts. The outstanding funds will be distributed to the concerned partners of
the organisation once the liabilities and debts have been properly inscribed.
Benefits Drawbacks

The primary benefit of this aspect is that it This element has a disadvantage that it will
allows the board of executives and higher increase the understanding trench rate and
authorities to easily escape their obligations, might cause potential employees to leave.
liabilities, and debts.

Mergers and Acquisitions: This function is quite helpful in keeping the subdivision's
succession plan on track. Mergers are a great means of merging two organisations so that both
parties may complete and work together to achieve the company's goals, which will help the firm
get highly competitive advantages. Small businesses might use the acquisition to sell themselves
to larger businesses by following specified procedures (Wang and et.al., 2018).
Benefits Drawbacks

The main advantage of this strategy is that it Its main drawback is that it increases the
improves certain talents and capacities possibility of duplication in marketable
while also eliminating potential hazards and processes.
uncertainties.

In terms of the opinions of exit plan and succession plan, according to analysis, the
succession plan will be the greatest option for Marshfield Bakery because it can provide a variety
of compensation to help the company achieve its long-term goals.

M4 Evaluate exit or succession options for a small business comparing and contrasting the
options and making valid recommendations
Based on the current discussion, succession planning is determined to be the most
appropriate ideal for the bakery, as the bakery is preparing for new commercial success and
needs to introduce new items. Thus, succession planning will be the healthier option. Exit
planning and succession planning are both harmful and appropriate for a firm, serving to analyse
certain establishments in order to effectively eliminate them (Wijaya, and Imran, 2019).

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Succession planning is well-considered to be the better alternative for firms looking to use
mergers and acquisitions to boost their economic success.

D4 Providing critical evaluation of exit or succession options for small business.

The exit strategy is defined as the most appropriate prepared framework that typically
defines numerous aspects that cause business functions to be disrupted. Exit strategies can help
firms identify specific problems and the sources of those problems, which can help them
succeed. Marshfield Bakery has evaluated this strategy, which can help them define specific
difficulties that affect company profits. Succession planning contributes in corporate
development as it can assist in identifying new leaders who could replace present firm
workforces when they leave. Succession planning allows for the transfer of power from one
person to another. Marshfield Bakery may design a strategy for organisation that effectively
considers all future aspects while also managing the uncertainty of any unfavourable scenarios.

Conclusion
It is being concluded from the above that, for the organisation planning is most important
part of a business's growth. To comprehend the market, the company determines several factors
using the growth matrix and tactics. Setting goals is the first step in the plan, which leads to
policies and tactics for achieving them. The plan's persistence is based on linking the objectives
to particular actions. It also assesses financial sources in order to attract investment and produces
a business plan to determine the company's performance. If the company can't pay its obligations
or make up for losses in an ever-changing climate, it's best to quit the market and depart from the
market.

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