Business Expansion Flashcards

1
Q

What is Internal Growth/Organic Growth?

A

When a business gets bigger by selling more of its products

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2
Q

What is External Growth/Integration?

A

When i business gets bigger by joining or buying other businesses

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3
Q

How does a Franchise occur?

A

When a Franchisee buys a franchise in return for a Fee and Percent of Turnover

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4
Q

What is a Franchisee?

A

Person that buys Franchise

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5
Q

What is a Franchisor?

A

Person that sells a Franchise

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6
Q

Advantages of selling a Franchise

A

Can grow quickly

Franchisee provides some finance

Franchisees have more motivation

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7
Q

Disadvantages of selling a franchise

A

Loses some control

One franchise can affect whole brand

Have to share profits

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8
Q

Advantages of buying a Franchise

A

Estabished Brand

Access to training and supplies

Share marketing costs

Can learn from other Franchisees

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9
Q

Disadvantages of buying a franchise

A

Have to share profits

Have to work in Franchisor’s guidelines

Have to contribute to group marketing

Sales suffer if brand reputation goes down

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10
Q

What is ‘E-commerce’?

A

Buying or selling a product online

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11
Q

What is ‘Outsourcing’?

A

When a business uses another business to produce for it

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12
Q

What are some ways internal growth can occur?

A

Franchising

Opening new stores

E-commerce

Outsourcing

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13
Q

What are some ways external growth can occur?

A

Merger

Takeover

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14
Q

What is a ‘merger’?

A

When two or more businesses join together to make a new one

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15
Q

What is a ‘Takeover’?

A

When a business buys control of another one

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16
Q

How to find ‘unit cost’

A

Total costs divided by Total output