Growth Options

GROWTH OPTIONS

Growth options

Different firms in different industries pursue different growth options in to explore varied potential investments so as to increase their revenue base , expand their market shares and market dominance as well as increase their Net worth . There are a number of growth options that can be pursued by a firm to achieve the above named growth objectives , the growth options include : expanding output , venturing into new geographical markets , mergers and acquisitions , partnerships as well as introducing complementary products or successive generation products (Business link , 2009 ,

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p Diversification as an option for growth relates to developing new related products targeting existing customers : Concentric diversification , as well a developing meant to serve new markets : Conglomerate . Among the two , Conglomerate diversification holds a lot of financial risks as it involved venturing in a completely new market . Examples of companies that have pursued diversification as an option for growth include , the giant soft drink company Coca-Cola that ventured into mineral drinking water production to increase its revenue base and exert its dominance in the beverage and soft drinks industry (Lawrence ,2007 ,p .1

The other growth options include Mergers and acquisitions . A Merger is where by two companies come together , formally combining all their operations into one company , in most cases Mergers always result into a change of name of the merging companies to a name and strategic framework that represent the two companies . Acquisitions on the other hand involve total take over...