Methods of Expansion
Some companies decide to expand to increase the amount of money income and obviously to become a bigger company and have a bigger amount of costumers. This also leads to more jobs for unemployed people. But, it can also bother or annoy some stakeholders.
Owning a business with managers responsibilities and a business that is already popular, meaning better profit and a high level of customers. However, there will be a bigger boss that is in charge of all the businesses to become one big franchise. e.g. Subway is a franchise
Making the company bigger or more extensive in order to serve more customers. This can even be done in other countries if your business has enough success!
When two companies join together to become one big company. This can be done by making an agreement with the company and buying into it to have access to part of the company
When one business takes over another to expand the original business, eliminate competition or to simply own another company e.g. Kraft took over cadbury's
When a company grows naturally without interference, this will take a lot of time and with luck you will have more customers, meaning more profit and the opportunity to expand
Pros and Cons
Merger/Takeover PROS- Better service, more customers, sharing ideas, larger profit (combining incomes) more money to spend on marketing
Merger/Takeover CONS - Many changes, could loose lots of employees, business image changes e.g. Cadbury's takeover by Kraft
Franchising PROS - Company increases in popularity, more profit, most customers served
Franchising CONS - Expensive and time consuming to get a licence, some contracts can last for a long time - such as MacDonald's that lasts for 20 years
Organic Growth PROS - Increased popularity, no loss of jobs, no risk of new companies taking over, more profit, more customers
There are no cons to organic growth, as it is entirely natural