- This topic has 2 replies, 2 voices, and was last updated 14 years ago by
.
- Posts
Any clue on how to build up point on the expansion strategy would be much appreciated – consolidation, market penetration, product development and market development
Many thanks
They can all be thought of as ways in which profits could be increased.
1st quadrant: (market growth, efficiency gains, withdrawal, consolidation). These are relatively low risk, but are likely to yield modes profit increases. it’s all very well saying that we will grow our market share from 20 to 25%, but competitors will retaliate. There’s only so much efficiency gains that can be made (cost cutting) before vital services are hit.
2nd and 3rd quadrants. Obviously deciding to break into another market (eg a European firm now also setting up in Asia) or developing a new product line will present the possibility of greater profits growth but there is more risk. More investment and resources are needed and there is a higher risk of failure.
Diversification is for the thrill seeker/gambler usually.
I’m not sure if that’s what you wanted.
- You must be logged in to reply to this topic.