Growing a Company by International Acquisition

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For growth, businesses should know when and how to introduce change, usually by acquiring business operating over and beyond the borders. That is, at that point where they reach maturity, meaning that they have tackled all the possibilities of growth and there exists no more opportunities where they are currently based.
The two major ways in which a company can grow are:-
• Organic growth
• Inorganic growth
Organic growth comprises of increasing new sales and new customers for the existing business to improve in terms of profit. The company grows within itself and improves its existing affairs, as opposed to inorganic growth which involves expanding the business from outside into other regions or countries. In organic growth, a company can be through a merger where two firms join by agreement or via takeover where one company buys at least 51% of the shares of another company. Therefore, the company with the majority of the shares has control of the business and chooses which activities to keep.
Under inorganic growth, integration happens in two ways;
• Horizontal integration is a situation where two firms operating in the same business sector or does the same business enters into an agreement in equal statue, as this will give them an advantage of a large customer base and also enables them to have economies of scale. The economies of scale arises due to cost sharing for example, managerial services, deliveries are made at the same time etcetera.
• Vertical integration where a company joins businesses when they are at different stages of production. The purpose of the integration could be to supply them with goods or buy goods from them. This way, the company has a huge control over the process of production.
The acquisition of...

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... force that is ready to go and settle down in those countries. The other issue could be the currency differences, which is an advantage and a disadvantage at the same time. The Pound is quiet strong against the dollar, and this will mean having a higher liquidity. The legal and administrative differences may not sound as a problem as developed countries always carry out their deals in a straightforward manner. The skills level also may differ given that the countries do not use the same syllabus to teach in schools, therefore, the company should only be hopeful that the country they are going to venture into has equal skills standards if not higher. In any case, they can always send some expatriates to go do the job.

Works Cited

The Times 100. Davis. Growing a company by international acquisition.. http://www.thetimes100.co.uk/downloads/dsgplc/dsgplc_13_full.pdf

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