Methods of expansion.
What is expansion?
Expansion is where a business grows. It can either grow organically or by merging or takeover.
Merger and takeovers.
A merger is when two businesses merge together. For example, Orange and T-Mobile merged together too create EE.
A takeover is where a business takes over another business. Like Kraft took over Cadbury.
The pros of a Merger/Takeover are:
-More customers (as if its a merger customers may come from both companies)
The cons of a Merger/Takeover are:
-Loss of jobs
-It could make one place close down which could effect income for some families
-It could effect the community
Franchising is where you're the boss of a business but you don't have to do all the work. For example, Subway and McDonald's. The pro's of franchising are, Support and advice, increased popularity and first class training.
The con's are, It would cost a lot of money and also you would have to do it for 20 years.
Organic growth is probably the best way to get bigger but also the hardest. Organic growth is when a company grows naturally. So basically they're successful on their own without help.
The pro's of organic growth are:
-No companies will take over
-No one will lose jobs (unless they are fired by the company for good reasons)
- And more popularity
Why would you want to expand?
Businesses may want to expand to get more profit. The company would become bigger. More jobs. More places (Variety). And government (less benefits, more tax).