1.7- Expanding A Bussiness Flashcards
When does a franchise occur
It occurs when a franchisor sells its rights to its product to a franchisee, usually this is in return for a fee or a perceantage of profits
Whats a franchisee
A franchisee buys a franchise usually for a percentage of turnover or fee
Whats a franchisor
They sell a franchise usually in return for a fee or a percentage of turnover
What’s e-commerce
The act of buying or selling a product using an electronic system e.g internet
What’s outsourcing
Outsourcing occors when a business uses another business to produce for it
Internal growth
Also known as organic is when a bussiness gets bigger through selling more of its products
External growth
Hen a bussiness gets bigger by joining or buying another business
Market capitalistion
How much the shares are valued at. Market price of a share x number of shares
When does a merger occur
It occurs when 2 or more businesses join together to form a new business
When does a takeover occur
When one business buys control of another
When does economies of scale occur?
It occurs when a business unit cost of production as its output rises and the business expands
When does diseconomys of scale occur
When the cost per unit increases as a business expands
