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MEANING
Business growth means an increase in the size or
scale of operations of a firm usually
accompanied by increase in its resources and
output
Scarcity of funds
Risk
Technology
Marketing
Survival
Economies of scale
Owners mandate
Expansion of the market
Latest technology
Prestige and power
Government policy
Self-sufficiency
Advantages
Limtations
Finance
Market
Human relations problem
Managemet
Lack of knowledge
Social problems
Limitations
Growth is very slow and it takes along time
Practical problems of intensive growth startegy
Business firm loses te possiblity of exploiting
many business opportunities
2. Diversification
. Advantages :
. Better use of resources
. Reduce the decline in sales
. More competive with greater resources
. Minimize risk
Limitations :
Huge funds are required
Diversificaton may lead to unknown
Types of diversification:
Horizontal integration
Vertical inegration
Concentric
Limitations
The accumulated savings of the business may
not be sufficient to finance
Existingstaff may face problems in adapting the
new technology
Survival strategies
Spin-off:
A business unit as a separate business through a
distribution of stock or cash deal
Allows a new management team to try to do
better with business unit is a poor or mediocre
performer
Liquidation is the best option
Divestment
An organisation divests when it sells a business
unit to another fir that will continue to operate it
In india the TATA group has in some form or the
other,been realiging its portfolio since the early
1990s
But few years it had done this in a mor stratured
manner
Liquidation
Liquidation is the final resort for a declining
company
This is the utimate stage in the process of
renewing company
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