1.3 Enterprise, business growth and size

1.3.2 Measuring Business Size

1.3.3. Why some businesses grow and others remain small

Student Task: "Why are there small firms?" read and note P 27-28.

How firms Grow

Read and note P 24-6 and attempt activity 2.6 (Borrington and Stimpson)

End of unit Activity:

You are the Personal Assistant for the Manager of ‘Wintel Ltd’. a medium sized Chinese Computer Company, based in Shanghai. You employ 250 workers. Currently the market for computers is good, although competition is increasing, and the sales figures are increasing.

Your Manager has been made offers by similar and larger Computer Companies to Merge or create a Joint Venture. To help him/her make a decision, you, as PA, have been asked to produce a report to cover the following issues.

* Identify the difference between a Joint Venture and a Merger.

* Give reasons why firms may choose to join together.

* Explain why External Growth may be quicker than Internal Growth for your Company.

* The negative side - Explain why Mergers may not result in an improvement in efficiency.

* To finish the report give your own opinion as to whether or not your company should Merge.

1.3.4 Why do businesses fail?