12.3. Strategy - Growth strategies

The great leap forward

An acquisition could increase the size and profitability of your business overnight. It might enable you to take advantage of new economies of scale, or diversify into new areas. You might be able to acquire a bigger and better customer base, or strengthen your management team.

But an acquisition can also bring problems, draining financial and management resources from your original business.

You need to work out whether the acquisition will add value to your business, after making realistic allowances for all the hidden costs.

This briefing covers:

• The arguments for making a business acquisition.
• How to use it to expand your business.
• How to use it to reduce costs and risks.
• Acquisition pitfalls and how to avoid them.