Chapter 22 - Business Expansion

• empire building - an attempt to increase the size of a firms staff and assets - empire builders want to dominate the market locally, nationally and/or globally
• diversification - when a business widens the range of goods and services it sells, or enters into new markets
• backward vertical integration - when a business expands back into the supply chain
• forward vertical integration - when a business expands forward into the market for its products
• Organic (internal) growth occurs when the business expands gradually over time using its own reaources
• Inorganic (external) growth occurs when the business expands by using mergers, takeovers or forming strategic alliances with another business or businesses
• horizontal integration - tow competing businesses join together
• conglomerate integration - a merger between businesses that are in unrelated industries
• hostile takeover - one firm acquires another business even though management oppose the acquisition