Week Acquiring another organization in the same industry may be the easiest of options. The strengths and weaknesses of each company get displayed for the new owners to view and grow as a greater power in the market. The get other channels of distribution and as a larger distributor they have more power with suppliers and pricing bargaining. They are able to keep smaller companies out of their marketing areas as they have a larger economic scale. They build synergies between the companies and are able to pay for acquisitions of new properties or companies with its shares and it has little or no liquidity problems.
The threat’s to acquiring another organization in the same industry is there may be duplication of efforts between the management and departments. When or if these departments and management positions are merged they possibility of layoffs is high and that will affect the moral of the employees. The conflicts of culture between the two cultures may be high due to the fact that they may use to be competing companies. And finally the acquiring company may have to pay a larger price to acquire the new company.
The second option is to merge with another company the strength of this option is that the cost is low and legally simple. Merging the two companies bring more bargaining power with suppliers, customers and distributors. The larger the two companies become the more money they have to invest in other ventures the owners feel may be profitable. They can improve the profitability and culture of the stores by restructuring and using the strengths of each of the two stores to gain more assets and customers.
The threats to this option are that the companies may be affected by anit-trust laws and become too large and monopolize the current market. The goals of each company may clash as the co-owners may differ in their approach to business scenarios, which