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External sources of Growth - Coggle Diagram
External sources of Growth
Merges and Acquisitions
ADVANTAGES
increased distribution capacities
lower labor costs
increased market share
Improved economic scale
increased market share
DISADVANTAGES
can very easily be conducted for the wrong reasons.
can destroy value
can distract from daily management
Strategic Alliances
ADVANTAGES
gain new resources
expand business
Earn new clients
get different sources of income
DISADVANTAGES
Encounter conflicts.
Face culture or language barriers.
Risk a company's reputation. ...
Earn unequal benefits
EXAMPLES
Sony and Ericsson
Starbuks and nestle
Joint Ventures
ADVANTAGES -
access to new knowledge and expertise, including specialized staff.
access to greater resources, for example, technology and finance.
increased capacity.
access to new markets and distribution networks.
DISADVANTAGES
the communication between partners is not great.
the objectives of the venture are unclear.
the level of expertise and investment isn't equally matched.
the work and resources aren't distributed equally.
EXAMPLES
BMW and Jaguar Land Rover
Disney and 21st Century Fox
Toyota and Mazda
Franchising
DISADVANTAGES
Varied levels of support
Contracts aren't permanent
Limited creative opportunities.
ADVANTAGES
Higher profits
proven business model
reduce risk of failure