3.1.2 Constraints on business growth:

Question 1

Size of the Market:

Answer 1

• If a market is small or full (saturated), it’s hard for a business to grow.
• There may not be enough new customers or opportunities to expand.

Question 2

Access to Finance:

Answer 2

Availability of capital, including loans, investments, and access to equity, is crucial for growth. Limited access to finance can hinder expansion plans.

Question 3

Owner Objectives

Answer 3

• Some want slow and steady growth for safety.
• Others want fast expansion, even if it’s risky.
• Their goals and how much risk they’re willing to take shape the company’s growth choices.

Question 4

Regulation:

Answer 4

• Government regulations and industry-specific rules can either facilitate or hinder growth.
• Following laws (compliance) can be costly or add limits, making it harder to grow.
• Some industries have stricter rules that impact how much a business can expand.

Question 5

Technology and Innovation

Answer 5

Staying competitive often requires investment in technology and innovation. A lack of access to cutting-edge technology can hinder growth potential.