Internal (organic) growth: the business grows by hiring more staff and equipment to increase its output.
External growth: where a business merges with or takes over another organisation. Combining two firms increases the scale of operation.
Franchising: where a business leases its idea to franchisees. This allows new branches to open across the country and internationally.
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Market share:
The proportion of total market sale sold by one business.
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Organinc Growth:
Expression from within the business (e.g. by opening more shop branches).
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Inorganic Growth:
Expression by merging with or taking over another business.
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Internet Selling:
Marketing products through the business's website.
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Franchisee:
The firm that buys the franchise rights from the existing business.
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Franchisor:
The Existing firm that sells Franchise right to another business.
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Merger:
An agreement between business owners to combine two businesses and operate as a larger one.
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Takeover:
Purchasing another business from its owner.
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Horizontal Integration:
Joining two businesses in the same industry and stage of production. (e.g. two hairdressing Businesses).
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Vertical backward integration:
Joining two businesses in same industry but a different stage of production, towards the supplier (e.g. a computer manufacturer's takeover of a 'chip' maker).
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Vertical Forward integration:
Joining two businesses in the same industry but a different stage of production, towards the customer (e.g. a farmer's takeover of a butcher's shop).
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Diversification:
Joining two businesses in different industries (e.g. an insurance company merges with a publishing business).
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Monopoly:
Any business with more than a 25per cent market share.
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Dividend:
Payment made to shareholders from company profits- usually made annually.
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Divorce between ownership and control:
When directors control a public limited company and thousands of shareholders own it, but the two gropus may have different objectives.
Public Limited Company (PLC) : A company able to sell shares to the general public by being listed on the Stock Exchange.
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