Business Expansion and Growth

Introduction

Majority of the new businesses that are being established are started from a smaller scale. This is due to the heavy investment which everyone can not afford. There are many options to raise capital such as loan from financial institutions or going public and issuing shares to get money from the general public. The founders of small firms usually learn their business while working at other firms, and many of their contacts evolved from this former employment. Empirical research demonstrates that for over half of all small firms, the most important customer is some large firm either in the region or nationally to which small firms subcontract their services (Humpage, pp.95).

The small business sector is an increasingly important component to larger economies. Small business operations act as a jumping-off point for entrepreneurs in both mature and emerging economies. Despite their importance, small businesses have a high failure rate. As these small companies always face financial stress, a single error can lead them to a massive failure. A small company is identified either by the number of employees or through examination of the company level data. The large companies usually comprises of various branches which are operating the same business structure. All the smaller companies which have become successful ventures tend to look for an opportunity to grow their business operations. The lust for having more profit and more market share motivates these small companies to grow and become large businesses (Humpage, pp.95).

Discussion

Many of the small companies are finding out different ways to expand their operation and to enhance their operations scale from small to large. There are many ways for a smaller organization to become a larger corporation.

Globalization

Globalization is the main change is in today's workplace. It stands for the economic interdependence between countries with cross-national exchange of goods and services, capital development, know-how and people. Globalization is best for those companies who have catered to the local market successfully. Globalization means to operate a current business other parts of the world. This will result in more revenue generation as the customer database will be increasing. Globalization not only increases revenue for the company, but it also helps in building a company image at international level. Globalization has progressed; the quality of life and life expectancy have improved significantly in almost all countries, with the strongest improvements in the developed countries. The indices of globalization have strengthened over the past two decades, in reference to the following: World trade grew by 10% or more well risen significantly in the emerging markets in Asia, capital flows, especially flows of private capital to developing countries, workers from one country to another has increased substantially and the foreign-born share of workers increasing globally by about 50%, and the dissemination of knowledge and technology (Civittolo, pp.18).

Additional Capital

Capital is the main obstacle for smaller business to grow larger. According to the research, majority of the small companies are working at their full capacity and has a potential to grow further, if ...