3.1.7 Expanding a Business
- discuss the advantages and disadvantages of methods of growth
- understand the methods used by businesses when expanding (organic growth through franchising, opening new stores and expanding through e-commerce, outsourcing and external growth through mergers and takeovers)
- understand the benefits of growth in terms of unit cost advantages due to economies of scale and the drawbacks of growth due to diseconomies of scale
- understand the meaning of purchasing and technical economies of scale
- understand that with growth businesses increase the risk of diseconomies of scale occurring due to poor communication, coordination issues and reduced staff motivation
- calculate and interpret average unit costs
Benefits of a growing business - Guardian article : The first Starbucks - What are the benefits of Subway opening new stores? - The growth of Amazon - Video advertising Shakeaway franchise - Could you be a franchisee activity - Franchises word search - Video
Benefits and drawbacks of organic growth - Kraft takeover of Cadbury - Telegraph article on Cadbury losing its magic - Huffington Post article on investigation into Kraft takeover of Cadbury
Introduction to Outsourcing
Merge between Dixons and Carphone Warehouse
Kraft / Cadbury one year on
Reuters article on reviving growth of Lego sales - 40D Undercover Boss - Past exam questions - past exam answers
BMW automation video.
Exam style question - Expanding a Business
Please use the link below to have a go at the exam question on Expanding a Business. Once you have had a go, use the markscheme to check your answe
Mark Scheme - Expanding a Business
Use the link below to access the mark scheme for the exam question.
Exam style question = Outsourcing
Use the link below to have a go at the exam question on Outsourcing. Once you have .