What you’ll learn5 learning objectivesChoose one objective for a focused lesson, or study the complete topic.1.5.1Economies and diseconomies of scale• Analyse internal and external economies and diseconomies of scale• Growth can lower average costs but may also create coordination, communication, or motivation problemsSyllabus objective1.5.2Internal and external growth• Distinguish between internal growth and external growth• Internal growth expands existing operations; external growth combines with or acquires other organizationsSyllabus objective1.5.3Reasons to grow• Evaluate reasons for businesses to grow• Growth may increase market share, revenue, profit, survival chances, economies of scale, and market powerSyllabus objective1.5.4Reasons to stay small• Evaluate reasons for businesses to stay small• Small size may preserve control, flexibility, personal service, niche focus, and lower riskSyllabus objective1.5.5External growth methods• Evaluate mergers and acquisitions (M&As), takeovers, joint ventures, strategic alliances, and franchising• External growth methods differ in control, speed, cost, risk, and integration challengesSyllabus objective
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