Size of Business A2

Type of growth of a business

• Organic

• Take Over

• Merger

• globalisation

When a business merge or take over business in different sector

• Horizontal

• Vertical

• Conglomerate

Benefit of horizontal merger / take over

• less labor cost

• cultural differences

• economies of scale

• less investment

When Samsung is taking over another mobile phone company

• horizontal take over

• vertical take over

• horizontal merger

• vertical merger

When a milk company and a chocolate company decide to have the operation together

• horizontal take over

• vertical take over

• horizontal merger

• vertical merger

Disadvantages for customers of horizontal merger.

• higher profit

• more job opportunities

• less choice of product

• more choice of product

When a shoe company take over shoe retailers

• Vertical forward

• Horizontal forward

• Vertical backward

• Horizontal backward

Having control supplies of materials to competitors" is an important advantage of

• Horizontal integration

• Vertical forward integration

• Conglomerate integration

• Vertical backward integration

Advantages of vertical backward integration

• better quality control

• need to find another supplier

• definite customers

• more investment

An owner of a hotel buy a clothing factory

• merger forward

• take over backward

• merger backward

• conglomerate