After reading this article you will learn about the internal and external growth strategies adopted by a firm. Internal Growth Strategy: It is a form of growth strategy where firms grow from within. They use their own resources or acquire them from outside to increase their size, scale of operations, resources (financial and non-financial) and market penetration. Intensive Growth Strategy [...]
After reading this article you will learn about the horizontal and vertical diversification of firms. Horizontal Diversification of Firms: It means adding parallel products or services to the existing product/service line. The existing technical, marketing and financial expertise is applied to new products also. Horizontal diversification can take the following forms: 1. Concentric diversification: It is a form of horizontal [...]
After reading this article you will learn about:- 1. Causes of External Growth Strategy 2. Merits of External Growth Strategy 3. Limitations. Causes of External Growth Strategy: 1. Economies of scale: Small firms have limited resources (financial and non-financial) and generally produce goods at high cost. They buy in small quantities and, therefore, pay high price for materials and other [...]