Why is "concentrated growth" considered the least risky strategy?
When is concentrated growth not a good strategy to employ?
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//Prior to discuss the various aspects of the concentrated strategy, it is better to understand the concept of the concentrated strategy. The prior knowledge of the concentrated strategy will help the user to understand the other aspects of this strategy very clearly.//
A concentrated growth strategy is a strategy which focuses on increasing the market share in the existing markets. Sometimes, it is also known as a market dominance or concentration strategy. Concentrated growth strategy is a low risk strategy, especially in a stable environment where demand is on the rise. Concentration may be concerned with attracting the customers of the competitors; and/or attracting the non-users or the new customers along with increasing the frequency of use of the product by its current customers. (Concentrated Growth Strategy, 2007)
//After understanding the concept of concentrated growth strategy, it is discussed that what amount of risk is associated with the concentration strategy. The discussion is also supported with the help of the examples.//
Concentration is a simple, first level type of expansion grand strategy. Through this strategy, the resources of the organization are directed towards the profitable growth of a single product, in a single market, with a single dominant technology. Thus, this strategy results in the improved performance of the organization. There are certain specific conditions which favor the concentrated growth. It is the least risky and least costly strategy among the 15 generic strategies.
This strategy, in other words is known as the "stick to the knitting". ...
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