Internal Expansion Flashcards
What is internal expansion?
is when a business grows by expanding its own operations.
This is a slower route to expansion than external expansion, but it is usually less risky.
*Opening new stores
*Increasing production capacity
*Launching new products
How does launching products help businesses expand?
This helps the business expand their customer base by selling products to current and potential customers.
This however can be risky due to the large investment required and the fact the business owner may not be as knowledgeable in other product markets(poor market research.
How does opening new stores help the business expand.
Opening a new store is a common way for a company to expand as it allows them to be closer to customers in another location.
However, internal expansion can need a lot of investment and can be costly.
How does increasing production capacity help the business expand?
Investing in new capital and technology can allow a business to produce more goods.
This is good because if products are consistently selling out and they are unable to produce more, then the production capacity is restricting their expansion.
