A Study On Healthy Potion

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Healthy Potion has been overall successful as a business, earning significant profits despite its small size. However, the business has now reached a stage where development is essential in order to increase future growth and profit margins. Hence, Healthy Potion must design a strategic plan that aims to diversify the business and subsequently arrange the appropriate finances necessary to materialise this plan. In order to invest in the businesses growth, Healthy Potion must evaluate the suitability of seeking either debt or equity financing.

Strategic Analysis

Magnification of a businesses strengths and weaknesses can reveal the necessary plan of action to improve growth and market position. This can be achieved via a …show more content…

Also, based on the information provided for this case study, Healthy Potions as a business has been developing well and earning significant profits.

However, Healthy Potion also has a few weaknesses that should be improved upon. As addressed by the purpose of this case study, Healthy Potion’s offer of a single product, on which its profit and performance are solely reliant on, exposes the business to large risk. Also, Healthy Potion only has once store open and has no online presence, hence limiting the company’s exposure to customers.

There are a few positive external factors on which Healthy Potion could capitalise, the main being the opportunity of developing a new product. This would allow the company to counteract the risk earlier identified of offering a single product. It would also facilitate the diversification of the company’s product offerings and provide the potential for the company to access new markets of consumers. In recent years, the consumer ‘health’ trend and emergence of the ‘healthy millennial’ market has dictated demand, with consumers willing to pay more in exchange for healthier products, a trend on which Healthy Potion could capitalise on (Hoffman, 2012).

However, negative external factors such as weather play an influential role on demand for Healthy Potion’s product. During the warmer months of the year, quarters 1 and 4, past sales history have shown peaked performance, whereas sales performance has been weaker during colder months,

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