Business owners and entrepreneurs are almost always seeking to expand their company, and the biggest question in deciding how to do so comes down to two options: slow growth or acquisition. As always, the decision will involve serious cost-benefit analysis, but each is not without its own degree of risk and reward.
If affordable, buying another business can immediately bring a new industry, customer base and profit line into a business’ hands, but as Matt Quinn writes for Inc. magazine, “you’re inheriting a process … By buying instead of building, you’re sacrificing the ability to tailor the business to all of your specifications.”
If acquisition is not a feasible option, slower, deliberated growth can be just as powerful in expanding your company. Building a company from scratch allows businesses to adapt quickly to changing circumstances while affording them full control over the pace at which they operate.
However, some markets and industries demand rapid expansion to merely survive, and such a slower pace of business may lead to costly missed opportunities.
These two options are not black and white; in some cases there is room for both. But as small businesses seek to expand, they should heavily consider the risks and benefits of organic development versus rapid acquisition.
http://www.bizilla.com/blog/2010/09/the-two-options-for-expanding-a-small-business/
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