1.6 business growth - amazon simple storage service (s3) · business growth organic growth ... •...
Post on 07-Apr-2018
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PowerPointGuide
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BusinessActivity
1.6Businessgrowth
Keyelementstothistopic
Benefitsanddrawbacksof
businessgrowth
Organicgrowth Externalgrowth
Whatisbusinessgrowth?
Theprocessofafirmgettingbigger
Differentwaysofgrowingabusiness
Organic EXTERNAL
GAININGNEWCUSTOMERS MERGER
INCREASINGOUTPUT
INCREASINGMARKETSHARE
OPENINGNEWSTORES
TAKEOVER/ACQUISITION
DEVELOPINGNEWPRODUCTS
OrganicGrowth
Organicgrowth,isachievedbythebusinesssellingmore
ofitsproducts.
Openingnewstores
• Increasemarketshare• Increasesales• Raiseawarenessofthebrand
Contextcorner
Aldiisopeningmanynewstores.StatetwopossibleeffectsonAldiandanindependentgrocer.
IndependentGreengrocerAldi
Introducingnewproducts
• Accessnewcustomers• Additionalsalesfromexistingcustomers• Raiseawarenessofthebrand
ExternalGrowth
Alsoknownasintegration,itisachievedbyjoiningwith
anotherbusiness
Merger
• Twoormorefirmsjointocreateanewbusiness• Benefitscanincludereducedcostsandincreasedrevenues
Takeover(acquisition)
• Onebusinessbuysanother• Canprovideaccesstonewmarkets,suppliers,technology
Typesofintegration
• Horizontal – abusinessjoinsabusinessatthesamestageoftheproductionprocess• Vertical – abusinessjoinswithitssuppliers(backwardvertical)oritsdistributors(forwardvertical)• Diversification– abusinessjoinsabusinessinadifferentmarket
WhyisAmazonbuyingWholeFoods?
Watchtheclipandidentify2reasonswhyAmazon’sboughtWholeFoods
AmazontakeoverWholefoods
Amazonaremovingintothegrocerymarket.
Whattypeofexpansionisthis?
Factorsaffectingmethodofgrowth
Sizeofbusiness
Natureofproduct
Positioninthemarket
Financialpositionofthebusiness
Regulation
Benefitsofgrowth
“WearedelightedouracquisitionofHomeRetailGroupisnowcomplete,”chiefexecutiveMikeCoupesaid.“ThecombinationofSainsbury’sandHomeRetailGroupcreatesoneoftheUK’slargestfoodandnon–foodretailers.
https://www.retailgazette.co.uk/blog/2016/09/sainsburys-acquisition-of-argos-parent-company-now-complete/
Justaminute
Youhave60secondstowritedownthebenefitsanddrawbacksofSainsbury’s
expansionplan
Advantages Disadvantages
AdvantagesandDisadvantages
Advantagesofgrowth
Accesstomoreretailers/outlets
Greaterbrandawareness
Lessvulnerabletotakeover
Greaterrangeofrewardsforstaff
Diversify/spreadtherisk
Disadvantagesofgrowth
Slowerdecisionmaking
Communicationmoredifficult.
Employeesmaybecomedemotivated
Co-ordinationcanbemoredifficult.
Increasedcosts
Iamthinkingof3differentwaysof
expandingabusinessWhatarethey?
FranchisingMerger/ TakeoverOrganic Growth
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