2.1 Growing the business

• Organic growth - Growth by increasing the size of the business through internal expansion, rather than by buying another business.
• new product development - the process of creating new products for a business this can contrabute to organic growth.
• research and development - the process of developing new products and services, improving existing products and services, and developing new methods of production.
• organic growth is very high risk and can be very expensive, but can be very rewarding.
• Inorganic Growth - The growth of a business through the acquisition of other businesses.
• Mergers - when two or more businesses join together to form a larger business. which in Inorganic growth.
• Takeovers - A business buying another business, usually by buying its shares which it would need to buy more than 50% of total shares. which is an example of Inorganic Growth.
• Public Limited Company (PLC) - A company that has shares listed on a stock exchange and is owned by many people. there is Limited Liability.
• Advantage PLC - easy to raise capital
• Advantage PLC - easier to aquire loans from banks
• Disadvantages PLC - more accounting work and more administrative work (paper work)
• Sources of Finance, internal - finding finance within a business by selling assets or using retained profits.
• External Sources of Finance - Finance supplied from outside of the business: Loans, Share Capital, FLoating on the stock Market
• Share Capital - The amount of money raised by issuing shares to the public.
• External Source of Finance, Floating on the stock market - the shares of a company are listed on a stock exchange and are traded on the market.
• Globalisation - The process ofa business operating internationally.
• offshoring - the process of moving a business's operations to a country with lower labour costs.
• Tarrif - A tax on imported goods, usually paid by the importer.
• Trade Blocs - A group of countries that have agreed to reduce or eliminate tariffs and other barriers to trade
• Pressure groups - an organisation that trys to influence how a business is run.
• pressure groups can may want to change a product or service or how they're made or carried out
• pressure groups might want to change the way a product or service is promoted as they might see it as harmful or offensive.