Diversification means expansion of business either through operating in multiple industries simultaneously (product diversification) or entering into multiple geographic markets (geographic market diversification) or starting a new business in the same industry.
A single-business company can diversify its business by adopting several strategies, such as a new venture, joint venture, or acquisition. This post will discuss strategies that a diversified company may adopt to strengthen its position and performance. 7 Corporate Strategies of Diversified Companies Once a company gets diversified, it becomes a critical obligation on the…
The product market scope refers to the industries the organization confines. When an organization follows the expansion strategy, the marketing or the production function underlies some degree of commonality between the different businesses it operates. Expansion and growth result from concentrating the resources within the domain of one or more businesses allied in terms of…
A joint venture refers to a new organization established by two or more organizations. It is an agreement where two or more firms hold equity capital in a venture.
Mergers & Acquisitions have become a common strategy to consolidate the business. The basic aim is to reduce cost, reap the benefits of economies of scale, and expand market share. For many people, mergers simply mean sharing resources and costs to increase bottom lines. However, it is not as simple as it sounds. According to…
A new venture strategy is also known as an ‘internal start-up.’ A new venture strategy encompasses diversifying into a new business by forming a new business unit. The newly-created business unit operates its businesses under the corporate umbrella. Creating a new company warrants various activities on the part of the management of the company. These…