Competitive Advantage & Exit Strategy Assignment Sample

Competitive Advantage Strategies for Food and Hospitality Businesses

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Assessment Brief Part 1: Planning For Growth Assignment Sample

Basis of Competitive Advantage for the Business

The determination of competitive advantage for a business is deemed to be an important area of consideration as it allows the business to flourish as per destined business goals and objectives. In order to determine a suitable competitive advantage for the business further emphasis is needed to be ascertained for identifying the nature and location of business. For the purpose of this assessment, the nature of business has been considered as a restaurant joint which is involved in quality service propositions for a variety of dishes. The location of the business is considered to be situated in London, United Kingdom, while the business name is considered to be XYL dining services. The main ideology associated with the initiation of this new business can be associated with the favourable prospects possessed by the food and hospitality industry. Following is a detailed synopsis associated with the basis of defining competitive advantage for the business.

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Product/ Service Features

The primary basis for defining competitive advantage is considered to be related with product and service features offered by the business. As the business concerned XYL dining services is mostly associated with offering quality catering and fooding services its product and service ranges mainly constitutes beverages as well as a large plethora of dishes. Simultaneously, the adherence to product and service features is deemed to be a vital basis for defining competitive advantage for this business as higher the products and services offered would lead to a high concentration of customers availing services on a daily scale. Ahmad and Ahmad (2019), idealised and opined that product and service features are also deemed to be vital parameters as it encourages a business to employ a wide degree of variability for gathering more customers. Hence, the more customers gathered would ultimately lead to higher monetary propositions and financial relevance in the near and distant future.

Financial Relevance

Financial relevance is deemed to be the second important parameter or basis associated with the determination of business competitive advantage existing in the relevant industry. The financial relevance for the concerned business of XYL dining services is further deemed to be an instrumental one as the adherence to minimised costs of operations is being highly echoed by the concerned management. Moreover, the adherence to minimised and optimised costs in the operational paradigm of this business allows room for contingencies which could be associated with setting up reserves for unforeseeable cost escalations. As per narrations and illustrations of Elashkar et al. (2021), the financial relevance is also deemed to be a vital basis as costs reduced and saved would ultimately lead to the generation of higher profitability. Moreover, turnover generation could also be maximised by adhering to financial relevance which would boost the competitive nature for the business in the near and distant future.

Tactical Collaborations

In addition to financial adherence, tactical collaborations are also deemed to be a vital parameter or basis of defining competitive advantage for the business concerned XYL dining services. Formation of tactical collaborations further benefits the business by ensuring strategic alliances in order to maximise business propositions in the current food and hospitality industry. Additionally, new-age business strategies could also be employed to ensure high sustainability prospects for the parent and its strategic business alliance. As idealised and stated by Harrison (2021), the formation of tactical collaborations also allows a business to ensure surplus monetary reserves for propelling business continuity on a daily scale. Moreover, operational structure can be further streamlined leading to prompt completion of daily operational duties to ensure maximised revenue generation. Technological advancement can also be guaranteed owing to the implementation of strategic alliances and tactical collaborations to ensure perpetual growth of parent business and its strategic business partner.

Ancillary Factors

In addition to the adherence for tactical collaborations, ancillary factors associated with a business are also considered to be an important basis of competitive advantage where a business has the ability to outshine its competitors. The ancillary factors associated with the business concerned XYL dining services is further deemed to be an essential parameter which relates to external factors which influence the continuity and progression of a business. As per narrations and illustrations of Cant (2018), the major ancillary factors can be further considered as investor orientation, acceptance from governmental and federal bodies. Hence, all these factors directly contribute to the development of competitive advantages and the concerned management has duly emphasised peacekeeping for all major stakeholders.

Critical assessment of opportunities available to the business

The assessment of opportunities available to the business concerned XYL dining services is considered to be an important phase for evaluating how the business propositions stack up in the existing market and industry. The assessment of opportunities available for the concerned business can be ascertained based on its dynamic nature, customer orientation opportunities as well as the measurement of financial reliability and financial credibility. Following is a detailed synopsis of the critical assessment of opportunities available to the business for defining its sustainability measures.

Customer Research

Customer research is deemed to be the primary opportunity available to the business concerned with XYL dining services in which the business has the ability to extract data and information about the proportion of customers that could be targeted as future prospects. The determination and conduct of customer research can be further conducted based on various research tools including surveys and questionnaires and an assessment can be made as to how responsive customers are. Accordingly, arrangements can be made with regards to how business can be maximised and how customer responsiveness can be increased substantially. Mazarrol and Reboud (2020), narrated and idealised that the customer responsiveness and customer research are deemed to be important factors of establishing market opportunities however the costs associated with conducting research are generally on the higher side. Hence, a balanced approach for conducting a comprehensive customer research is needed to be initiated in order to fetch destined customer orientation rewards.

Obtaining a High-Level market detail

The second important determinant of establishing ample market opportunities for the business concerned XYL dining services is considered to be associated with obtaining a high-level of market detailing. The process of market detailing could be a tricky one as a high amount of filtration and search optimisation is needed to be conducted on behalf of an organisation to assess the credible business opportunities prevailing. However, as critically stated by Honig and Samuelsson (2021), the acquisition of a high-level market detail is considered to be a costly affair as a lot of groundwork and preparation is required to be considered in order to fetch the targeted market opportunity rewards. Moreover, the high-level of market detailing is susceptible to economic volatilities which could halt the progression of needed activities to be conducted and could also nullify business propositions in a harmonious manner.

Identification of Additional opportunities

In addition to the critique facilitated for a high-level of market detailing, the identification of additional market opportunities is also deemed to be an important facet of determining ample market opportunities to allow business expansion of XYL dining services. The various forms of additional market opportunities that could be facilitated by the concerned organisational spearhead consists of a situation analysis, research for social media as well as determining an environmental analysis. However, as per critical explanations of Welling et al. (2019), the prevalence of numerous threats and disadvantages loom as the chances of financial volatility remain higher when additional marketing opportunities are being facilitated. Moreover, higher time constraints for identifying additional opportunities also prevail, leading to indifferent market propositions for the XYL dining services. Streamlining of operational responsibilities and duties could also be a major challenge under the identification of additional opportunities which could nullify the market dominance for the business in the near and foreseeable future.

Evaluating the relevant business environment factors

In addition to the critique detailed for additional information, the evaluation of relevant business environment factors is also considered to be an important factor for determining adequate market opportunities. The primary facet associated with the evaluation of relevant business environment factors is considered to be related with conducting an overall analysis of risks and threats looming in the local UK market. Moreover, the concerned management of the business XYL dining services can also reframe its business objectives to align with market masses for achieving a higher degree of business sustainability. However, as per critical explanations of Kamariotou and Kitsios (2019), the evaluation of business environment t factors also adds up to market and economic risks which causes a large-scale disruption for a business. Moreover, the chances of disharmonised and disorganised economic factors could also disrupt the healthy business environment activities further hampering the business sustainability measures in the foreseeable future.

Critical assessment of options using the Ansoff Matrix

The Ansoff Growth Matrix is considered to be a vital marketing framework which encourages a business to establish a valuable relationship between products and markets. The available growth options associated within the Ansoff Matrix are considered to be market penetration, product development, market development and diversification. Following is the detailed assessment of all key growth metrics of Ansoff Matrix along with the assessment of risk factors for each option.


Figure 1: ANSOFF Matrix

(Source: Inspired from, 2022)

Market Penetration

Market penetration is considered to be the first important growth factor considered to be an integral part of the Ansoff Growth Vector Matrix. The market penetration growth factor is considered to be a combination of existing markets and existing products where an organisation can assess how much their products are being utilised in general by customers and by comparing the overall market propositions for the associated service. Hence, the market penetration vector growth factor allows XYL dining services to assess how much business worth is being generated by the organisation and how it compares with the overall market aesthetics. However, as per critical explanations of Fung et al. (2020), fundamental disadvantages associated with the market penetration are considered to be high upfront costs and conflict in pricing strategies. Risks associated with market penetration growth factors are considered to be higher operational costs which could upset the overall production planning and product prices needed to be applied for fooding and beverages by the business.

Product Development

In addition to market penetration, product development is also considered to be an important facet of the ANSOFF matrix vector growth factor applicable for the business concern of XYL dining services. The product development can be further associated as a culminating factor for determining the combination of new products and existing markets. The product development stage of the ANSOFF growth vector matrix is further deemed to be a vital factor for determining the initiation and the product development stages needed to be considered for the development of a new product from its infancy stage.

The product development factor applicable for the business concerned XYL dining services is deemed to be a useful metric for ascertain innovations and modifications needed to be made in fooding and beverages. However, as per critical observations of Khumayah and Siswoyo (2019), product development growth factor is deemed to be associated with increasing market competition as well as rapid evolution of markets. Moreover, the risks attributed with product development growth are considered to be related with uncertain metrics of how the new product is expected to be responded to by customers.

Market Development

In addition to the growth factor of product development, the growth factor as per ANSOFF matrix also consists of market development. The market development growth factor can be further assessed as a mixture of new markets and existing products. The market development growth factor as per the ANSOFF matrix is deemed to be a vital factor which could be applied by the concerned management of XYL dining services for regular purposes. The market development growth factor as per the ANSOFF matrix further allows scrutinising market expansion opportunities in order to maximise business propositions and to acquire new customers from overseas or new markets. Mariani et al. (2019), critically stated and idealised that major demerit of the market development is deemed to be related with requiring higher investment influx for facilitating business expansion in overseas markets. Moreover, the risks associated with market development can be ascertained with respect to providing a high emphasis on acquiring proper documentation, paperwork and licences.


Diversification is considered to be the fourth important growth factor associated as an integral component of the ANSOFF growth matrix. Diversification is considered to be a combination and integration of new markets and new products where channelising of market and product growth is being encouraged highly. The diversification prospects and growth factors available can also be applied by the concerned management of XYL dining services in a diligent manner to attain continued progression of their business. However, as critically stated by Nikolopoulos et al. (2021), the demerit of diversification can be attributed with obtaining a half-baked analysis of how market and product expansion can be facilitated. Risks associated with respect to diversification are deemed to be a critical aspect as venturing into an unknown territory could lead to financial and operational disharmony.

Critical assessment of options and sources of finance

The critical assessment of options with regards to establishing financial growth for the business concerned XYL dining services is deemed to be an essential area of consideration needing a large-scale emphasis and due diligence. The fundamental motto for any major business organisation is mostly associated with establishing business growth through its finances in order to justify business sustainability and development. Hence, the identification of various sources of finance is deemed to be a vital parameter for establishing harmonised financial growth and to ensure that an organisation stays afloat in the industry and the market (Das and Mitra, 2018). The dynamic nature of competition existing in the food and hospitality industry is also deemed to be a suitable marker, which requires the managing concern of XYL to adopt credible sources of finance for propelling financial growth and stability. Following is a detailed demonstration of the various available sources of finance which could be employed by XYL to boost its financial credentials.


Debt is considered to be the primary source of finance, where essentially an organisation looks to borrow funds from external sources. Debt as a source of financing can alternatively be termed as loans which is deemed to be the most important source of financing. The facilitation and selection of debt as a credible source of finance is deemed to be an essential factor as this source of financing usually encourages a business organisation to weigh up its market leveraging prospects. However, as per critical illustrations and explanations of Seo and Cho (2020), the associated disadvantages of selecting debt as a source of finance can be attributed to the obligation and burden to pay back loans and borrowings. Thus, financial risk and financial liability could lead to dilution and saturation of XYL dining services, which could effectively take a toll on its market aesthetics and business sustainability prospects.


In addition to debt, equity is also considered to be a vital source of finance, where funds are obtained by a business or an organisation from external sources. Unlike the debt source of financing, the equity source of financing is considered to be slightly different as it allows a business or an organisation to raise funds from public and private investments. In order to facilitate the equity source of financing further emphasis is being laid by an organisation with respect to issuing shares and listing the company in securities exchanges and capital markets. Thus, a large influx of monetary resources can be accumulated in a short span of time which shall boost the business concerned XYL dining services to ensure high financial aesthetics. However, as per critical expressions of Wibowo and Sari (2018), the disadvantage of equity source of financing can be attributed to potential losses in business control. Hence, this could jeopardise the authority and power stakes for XYL to cater business continuity in the near and distant future.


In addition to the equity source of financing, crowdfunding is also deemed to be an important component of the sources of finance. In crowdfunding, an organisation or a business encourages accumulation of finances through smaller pools in order to arrive at a larger fund collected pool. Crowdfunding is also deemed to be a new-age source of financing where an organisation has the ability to collect funds based on offering accessibility through online or social media platforms. Hence, this form of financing is deemed to be beneficial for XYL dining services as it allows faster accumulation of funds and encourages the business to grow exponentially. However, as critically expressed by Sklair and Glucksberg (2021), credibility of sources of finance collected is deemed to be a grey area for crowdfunding. Hence, the chances of financial risks and falsely identified finance sources remain high which could dilute the business objectives for XYL dining services.

Venture Capital

In addition to the discussion facilitated for crowdfunding, venture capital is also deemed to be an important source of finance where capital is being raised with the help of investments facilitated by small private investors. The major rationale associated with the facilitation of venture capital is considered to be related with finding favourable propositions in a business through which investors can multiply their monetary and financial reserves. Role of financial intermediaries is highly encouraged under venture capital which further allows XYL dining services to speeden up wealth accumulation processes. However, as per critical illustrations of Sukmana et al. (2022), the demerits of venture capital are considered to be high time constraints needed to find appropriate investors for approaching the idea of venture capital and business collaboration.


Following recommendations are being proposed to the concerned management of XYL dining services with respect to selection of sources of finance as well as how to strategize growth factors as per Ansoff Matrix.

R1: It is recommended to select debt as the main source of finance

The selection of debt as the major source of finance has been recommended as it weighs up suitable leveraging prospects as well as encourages proper utilisation of loans and borrowings in a budgeted manner.

R2: It is recommended to ensure alternatives for strategizing growth of business

Identification and selection of appropriate alternatives is needed to be considered under the Ansoff Matrix to ensure extended sustainability of business propositions for XYL dining services.

Assignment Brief Part 2: Developing an Exit Plan

Importance of Exit Plans

Availability of a business exit plan is deemed to be an important aspect that is needed to be considered by an organisation to facilitate growth and development as well as securing financial and operational reserves duly. The availability of exit plans for the concerned organisation XYL dining services is further deemed to be crucial in order to have potential backup for winding operations in case the project does not reach its destined objectives. As per narrations and explanations of Lemley and McCreary (2021), the importance of availing a feasible business exit plan or strategy is considered to be related with identifying valuable liquidity options for limiting business losses.

This is usually deemed to be an unfavourable situation for an organisation as it could potentially limit abilities of expanding business into new ventures and geographic locations. The additional importance of strategising and devising a feasible exit plan is considered to be associated with raising capital or funds to encourage cash reserves in the wake of business exit. Often this strategy is deemed to be important as it leads to availing cash influxes while also enabling organisations and their associated stakeholders to walk out with some value. Hence, consideration to adherence for incorporating exit strategies is needed to be considered by XYL dining services in order to avail ample options of liquidity during business uncertainties.

Appraisal of Exit Options

The appraisal of exit options is also regarded as a key determinant for the company concerned XYL dining services to weigh up its financial resources in an exponential manner, The various exit options that are available for an organisation consists of IPO strategy, strategic acquisitions and buyouts. As stated and idealised by Jamaludin et al. (2020), the application of IPO strategy can be further incorporated when an organisation is making ample profitability from its regular business. Hence, in this manner an organisation can cut its stake from profits and move away from their business by selling the business to suitable vendors. The purpose of cutting out stake and moving away from regular business could be associated with regards to an organisation wanting to explore into a different corporate field or to encourage itself into developing business aesthetics for a new venture.

Strategic acquisitions are also considered to be a viable exit plan and strategy for a business where it has the ability to make its own “cash cow” as well as initiate business sale to close allies. As stated and narrated by Chirico et al. (2020), “cash cow” strategy is highly implemented by businesses which allows them to preserve copyrights and patents of a particular product or service in lieu of acquiring profitability from business sold to vendors. Moreover, business buyouts further encourage an organisation to merge itself with other industry competitors for limiting financial risks and to encourage a high volume of monetary reserves and profitability. Both these strategies could be implemented by XYL dining services to ensure that ample funding is available and ample business exit strategies are available when the company feels like liquidating or shunning its operations.

Critical Evaluation of Different Exit Options

The wide range of business exit strategies also contains its fair share of disadvantages and critics. In the case of IPO exit strategy, the main disadvantage is considered to be loss of part or total ownership for an organisation which could ultimately hamper its business continuation prospects in the relevant industries and markets. As critically expressed by Mellema and Ghorbani (2021), the loss of ownership partly or fully could also lead to the owners of an organisation having no authority to make and invoke decisions that cater to business facilitation on a daily basis. On the other hand, the criticism of strategic acquisitions could be further considered as requiring a high time constraint and high financial reserves to catapult business stability and functionality to provoke successful business exit strategies.

As per critical illustrations of Cox et al. (2021), these factors could lead to further disarray and disharmony for an organisation that is looking to move itself away from a business that is generally deemed to be fruitful or could be troublesome. The associated criticism regarding buyouts could be associated with finding difficulty in getting approval from a suitable business competitor to encourage merger and acquisitions at a swifter rate. Thus, all these critics possessed by various exit strategies are needed to be considered duly by the concerned management of XYL dining services for minimising its financial and operational risks occurring due to exit plans and strategies.

Benefits and Limitations


Benefits associated with the exit strategy of IPO or Initial Public Offerings is considered to be related with availing a high potential of funds to facilitate fundraising in a harmonious and streamlined manner. The additional benefits attributed with implementation of IPO exit strategy by XYL dining services is considered to be related with creating high prospects of financial credibility and financial publicity. The advantages associated with the exit plan of strategic acquisitions is considered to be related with availing high funding propositions to sell off assets in a harmonised and affluent manner (Dickens et al. 2020). The associated advantages of implementing buyouts are considered to be reducing the overall presence and existence of market competition.


Limitations associated with implementation of IPO as an exit strategy could be associated with higher presence of market pressure and transaction costs. The limitations involved with strategic acquisitions are considered to be associated with potential of creating lower brand value for XYL dining services. The main limitation associated with implementation of a buyout strategy could lead to an organisation yielding higher prospects of debt and borrowings.


R1: It is recommended to implement a Combined Exit Strategy

The application of a combined business exit strategy shall enable the organisation to implement a credible exit strategy which assures that funding propositions are not jeopardised. Furthermore, financial risks could also be avoided by implementing a combined exit strategy by XYL dining services.

R2: It is recommended to consider revival options for business

The second recommendation proposed to the concerned management of XYL dining services is considered to be related with assessing revival options in which business sustainability could be encouraged through mitigation of risks. Hence, this recommendation is being empowered to ensure perpetual business continuity as well as generate high market competition in the food and hospitality industry.


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