Explain five strategies that a small – scale firm could adopt to expand so as to enjoy economies of scale.

      

Explain five strategies that a small – scale firm could adopt to expand so as to enjoy
economies of scale.

  

Answers


Davis
i) Entering into suitable vertical integration/amalgamation/merger with firms at different stages of production.
ii) Diversification/variety of products in order to capture to wider
market/increase market share.
iii) Buying/acquiring other similar businesses to widen the scope
of activities
iv) Secure loans/credit to expand its capital base.
v) Arrange for franchising, by acquiring rights to produce/selling goods under a name of another company
vi) Expand the markets to increase the volume of sales.
vii) Adopting appropriate technology to increase quantity/quality
viii) Ploughing back profits to finance its operation
ix) Forming cartels with similar businesses
Githiari answered the question on September 22, 2017 at 22:25


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