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Business Expansion

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Reasons for Expansion

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Terms in this set (26)

Reasons for Expansion

Offensive Reasons. Defensive Reasons. Psychological Reasons

Offensive reasons For expansion

Acquisition of products of patented technology/ products. Elimination of competition. Asset Stripping

Defensive Reasons for expansion

Diversification - moving into a different industry to spread risk. Protection of Supply chain - Buying out a supplier to secure suppliers or buying a retailer to control selling. Economies of Scale - Larger business spread fixed costs out over more units leading to cheaper prices e.g IKEA

Psychological Reasons for Expansion

Entrepreneurial Drive

Importance of Irish business expansion In Ireland

Tax revenue for the government. Increase in employment. Spin-off effect - Businesses need the services of other businesses. Lower prices for consumers - due to economies of scale