Organic Growth (AQA A-Level Business): Flashcards

Growth from within using own resources & capabilities

Through reinvested profits

Financed using profits earned, not large debts or risky mergers

Slower and more gradual

When further growth causes loss of money, not efficiency gains

Demand rises but buying materials reduces working capital

Phases of growth, each followed by a crisis to resolve

Red tape crisis (too many procedures decrease efficiency)

Agreement to use established business's idea, name & reputation

Poor franchisee standards damage entire brand reputation