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Strategic Methods - Coggle Diagram
Strategic Methods
Franchising
Entrepreneurs will usually pay a franchising fee as well as a percentage of monthly revenue/profit back to the business
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Where a business gives an entrepreneur a licence to create a branch of the business under their ownership
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Kaizen
Benefits
Increased efficiency/productivity- decrease wastage, which can lead to increased productivity.
Stronger culture of improvement- fosters a culture where everyone is encouraged to contribute to continuous improvement
Improved quality- focusing on small improvements, can lead to significant improvements.
Definition
Kaizen focuses on small, gradual improvements rather then large disruptive ones.
Retrenchment
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Retrenchment can be used in situations such as when a business needs to leave a market due to losses/failure so they may retrench out of the market in order to prevent further loss
Growth
External
Inorganic growth is where a business uses methods such as takeovers to grow their operation using external rescources.
Advantages - Fast growth,
Disavantages - High Risk, Reduced Control, integration Difficulties
Organic
Disadvantages - Slower growth, reliance on internal rescources
Advantages - Lowers risk, maintains control over operations
Organic growth is where a business will use methods within the business, such as advertising and opening new locations in order to enlarge their operation
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