Extras din curs
Life cycle of a firm
Life cycle of a firm = life cycle of its products discussed (marketing)
Startup or experimentation :
- sales grow slowly
- net losses
- main sources of finance: trade
credit and government agencies
Rapid growth stage :
-sales grow fast and profit increases rapidly
-in order to satisfy the demand, the firm needs to increase its production line
-dangerous period for a small business, tests the manager
-requires an increased amount of long term funds;
if the long term funds cannot be obtained, growth must be slowed to a sustainable amount by own earnings
Life cycle of a firm
Maturity stage:
-sales growth is slow
-earnings can sustain needed growth
-liquidity can be rebuilt
-management switches focus from financing to marketing
Decline stage:
-market saturated
-need diversification
-assets sold to free liquidities
Conținut arhivă zip
- Financing Small Firms and Startups.ppt