While growth is a common business objective, it is neither easy nor cheap for the company to achieve as there are many problems linked to business growth.
Posts tagged as “Internal Growth”
External Growth can lead to rapid expansion of the business which might be vital in very competitive markets, or in industries that expand fast.
A Joint Venture (JV) and Strategic Alliance (SA) plays a key role in a corporate growth strategy. Check the steps in forming one.
External Growth (or inorganic growth) occurs through dealings with other businesses outside the organization. It is usually achieved by merging, acquiring or taking over another company.
Because the costs of External Growth are considerably high, it means that Internal Growth is the only suitable method of growth for many firms on the market.
Internal Growth is financed through a combination of retained profits, borrowing money, asking shareholders to contribute more capital or issuing new shares.
Internal Growth occurs when a business grows organically using its own resources to increase the scale of operations. Internal growth is typically slower.
Business growth is quite straightforward. Businesses can grow in two different ways, either through Internal Growth or External Growth.