3.2.3 Organic Growth Flashcards
1
Q
Define organic growth?
A
business grow from within - using own resources to produce and sell more
2
Q
Define inorganic growth?
A
taking over or merging with another company in order to increase output
3
Q
How do business grow organically?
A
using retained profit or a form of a loan which is invested back into the business to increase production
4
Q
How can smaller businesses look to expand?
A
Developing a new product
taking products into new markets abroad
using a franchise system
5
Q
3 adv of organic growth?
A
considered less risky
no reliance on outside agents
keeps business culture
6
Q
3 disadv to organic growth?
A
slower than inorganic growth
may lead to overtrading
Takes time to rationalise