Expanding a business
- Created by: Kirsten Reading
- Created on: 27-04-13 12:33
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- Expansion
- Benefits
- Economies of Scale
- Greater market power
- Status
- Profits
- Internal (organic)
- Cheap
- Sell more of own products
- Current products in new markets
- Launch new product
- Disadvantages
- Loss of control
- Decision making
- Employees feel disconnected
- External
- Mergers
- Vertical Backward
- Join with suppliers
- Vertical Forward
- Join with distributors
- Conglomerate
- Join with firm in different production process (unrelated)
- Horizontal
- Joins with firm at same stage of same production process (T-Mobile & Orange)
- Vertical Backward
- Mergers
- Franchising
- Business sells right to to another business to use its name and sell its products
- Greater economies of scale
- Increased sales
- Risks
- Stakeholders
- Employees - job security less involvement
- Suppliers - more sales, demand lower prices
- Community - jobs, pollution
- Shareholders - profit
- Strike
- Boycott
- Lobby governemnt
- Benefits
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