EXTERNAL GROWTH Flashcards
1
Q
What are the pros of external growth
A
Enables a compnay to gain sales and market share quickly
Gain synergies and economies of scale
Enable cost savings to be made by combining functional areas
Gain expertise and know - how
Gain new technologies or IP
Reduce the levels of competition
2
Q
What are the cons of external growth
A
Difficulties of merging two companies - cultures and systems
Impact on motivation - Job losses, reorganisation or work and uncertainity
Risk of the unknown
Buying another organisations’s liabilities
Competition concerns
Ethics
The high costs of intergration
3
Q
A
