Growing the business

• What is internal (organic) growth in business?

  Expanding activities like selling more products
• What is required to sell a new product?

  Innovation and consistent research development
• What is innovation in a business context?

  Successful commercialization of an invention
• How can technology assist businesses in growth?

  By targeting new markets and setting up branches
• What challenges do businesses face when entering overseas markets?

  Understanding local systems and forming bonds
• What are the advantages of global growth for a business?

  • Retains company culture
  • Higher market penetration
  • Economies of scale
  • Maintains quality and staff training
• What are the disadvantages of global growth for a business?

  • High-risk strategy
  • Limited growth potential
  • Long ROI periods
• What is a merger in business terms?

  When two businesses voluntarily join together
• What is a takeover?

  When one business purchases another
• Why do businesses choose to take over others?

  To eliminate competition and acquire skills
• What are internal sources of finance for business growth?

  • Retained profit
  • Selling assets
• What is retained profit?

  Profits reinvested back into the business
• What are the advantages of internal sources of finance?

  Low costs and immediate availability
• What are the disadvantages of internal sources of finance?

  Limited funds and unforeseen problems
• What are external sources of finance for business growth?

  • Loan capital
  • Share capital
  • Stock market flotation
• What is loan capital?

  Money raised through loans for business
• What is share capital?

  Finance raised by selling shares of a business
• What is a PLC?

  Public Limited Company selling shares publicly
• What is stock market flotation?

  Listing company shares on the stock market
• What are the advantages and disadvantages of external sources of finance?

  Advantages:

  • Access to larger funds
  • Potential for rapid growth

  
  

  Disadvantages:

  • Loss of control
  • Increased financial obligations
• What does SMART stand for in business objectives?

  Specific, Measurable, Achievable, Realistic, Time-bound
• Why might business objectives change as a business grows?

  Due to new employees and raw material needs
• What are some internal influences that can affect business objectives?

  Workers and clients
• What are some external reasons for changing business objectives?

  Market changes and performance metrics
• What are some market changes that can influence business objectives?

  Size of market, competition, economy changes
• How can performance metrics affect business objectives?

  Through profit, revenue, and productivity changes
• What are the targets for a growing business?

  • Enter new markets
  • Expand product variety
  • Increase sales
  • Market share
  • Improve workforce
  • Open new stores
• What are the targets for a struggling business?

  • Exit poor markets
  • Decrease product variety
  • Raise price/break even
  • Improve efficiency
  • Maintain market share
  • Reduce costs
• What is one way to increase a product range?

  Introduce new flavors using focus groups
• What is a strategy for entering new markets?

  Collaborations with other businesses
• How does Coca-Cola manage its product range?

  By adding existing products and removing poor sellers
• What is a potential consequence of market changes?

  Changes in size of market and competition
• What does it mean for objectives to be time-bound?

  They have a specific deadline for achievement
• If a business is struggling, what should it do regarding product variety?

  Decrease product variety
• How can a business improve efficiency?

  By optimizing processes and reducing waste
• What is one internal influence on business objectives?

  Clients
• What does it mean for objectives to be achievable?

  They are realistic and attainable within resources
• How does globalization affect business objectives?

  It introduces new markets and competition
• What is the significance of measuring performance in business?

  It helps assess profit, revenue, and productivity
• Why is it important for objectives to be specific?

  To provide clear direction and focus