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INTERNAL GROWTH - BUSINESS - Coggle Diagram
INTERNAL GROWTH - BUSINESS
Internal Growth
A business can grow by developing new products, this is called
new product development
New product ideas brought to marker for customers to buy are called
innovations
A business can put investments into
R&D
which is
research and development
Organic Growth
Organic growth
means that the business has grown from within
The business has grown from within itself without a merger or takeover with another business
Internal Growth - New Markets 1
A business can grow from within by
entering new markets
:
-This could be
expanding overseas
-This could be by changing
marketing mix
-This could be by
taking advantage of technology
Disadvantages of organic growth
This is a very high risk strategy,
opening lots of stores or taking on new staff is very risky
Long period between investment
and
return on investment
Growth may be limited
and is
dependent on reliability of sales forecasts
Internal Growth - New Markets 2
A business can grow from within by launching
new products
Cath Kidston - seller of
mugs, bags and clothing
has now moves into the
cycle and glasses market
Advantages of organic growth
A business that grows from within
can retain their own company culture
Higher production means
the business can
benefit from economies of scale
and
lower average costs
More influence comes with more market share
, the business can
start setting prices for the industry