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Methods of growth (Intagration (Vertical intergration (Forward vertical…
Methods of growth
Intagration
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Horizontal intergration
When two businesses providing/ producing the same service/ product join together (e.g. two airline companies joining together).
Through joining both businesses will become bigger, gain a greater market share and will reduce the number of competitors within the market and reduce the chance of a takeover. As a result of less competitors the business can charge a higher price. Being a larger businesses allow the business to take advantage of economies of scale which in turn will save the business money and increase profits.
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Organic growth
When a businesses increases the number of goods/ services it offers or increases the number of branches/ outlets and employees it has.
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