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Business Acquisition

Acquisition means taking ownership of another business. This is a faster means to scale your business. Growth of a business from one level to another depends on various factors, more importantly time and economy. By acquiring a company you are in the advantage because the acquired company has a readymade position in the market. The entrepreneur need not build the company from scratch which is much lengthier process.

The initial business plan must have well defined strategy that set out the growth of the company clearly. The organic growth of a business is a slower process in comparison to inorganic growth by business acquisition. The internal growth process of the business might take up more time and investment. Acquisition will lead you to the objective faster.

In an article for Gaebler Ventures, Gregory Steffens says “a company must be sure that acquisition will contribute more value to the firm than the premium will cost. If this synergy value is not at least as much as the premium costs, then the firm should not participate in the acquisition.”

It is important for the buying company to be sure of how the acquired company will add value and bring about more revenue after acquisition. Once the company is acquired steps need to be taken to maintain the culture of the acquired company and ensure employee satisfaction.

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