Organic Growth Flashcards
What can organic growth can also be known as?
Internal growth
How does organic growth occur?
It occurs when a business expands its own operations without relying on external takeovers and mergers
Give three ways organic growth can come around?
.Increasing existing production capacity and technology
.Development and launch of new products
.Finding new markets by exporting into emerging countries such as India and South Africa
.Establish new distribution channels such as online sales platforms
.Growing a customer base through marketing and adding new users of a product
Give two advantages of organic growth
.Less risk than external growth
.Can be financed through internal funds
.Builds on businesses strengths
.Allows the business to grow at a more sensible and sustainable rate
Give two disadvantages of organic growth
.Growth achieved may be dependent on the growth of the overall market
.Hard to build extra market share if a business is a market leader
.Slow growth-shareholders prefer rapid growth
.Franchises if used can be managed effectively
