Alternative Strategies Relating to Substantive Growth, Limited Growth

or Retrenchment
Growth strategies for businesses can be categorized into three major groups, limited
growth, substantive growth and retrenchment. Strategies for limited growth include
market penetration, market development, and product development. The strategies for
substantive growth include horizontal integration, related diversification, vertical
integration and unrelated integration. On the other hand strategies for retrenchment
include turnaround and divestment strategies (Bryson, 2011).Samsung can use these
strategies as part of their growth and expansion strategies to help the organization meet its
objectives.

Market penetration is a strategy for limited growth, which entails promoting existing
products and services within the same market. The main objective here is to increase the
market share for a particular brand or company. A company can achieve this by lowering
its prices or differentiating its products.

Product development strategy entails expanding a company’s products for instance,

through further development where new features will be added to the products (Bryson,
2011).

Market development strategy, on the other hand, involves selling products in a new
market. Reasons for this strategy may include seeking a new market with limited
competition and room for growth in the market. These limited growth strategies would not
be suitable Apple because it already has the largest market share in comparison to its
competitors.
Horizontal integration is a substantive growth strategy involving a situation where an
organization acquires or creates production units that are similar, either complimentary of
competitive in order to create a monopolistic situation in the market. This can happen
when a company acquires its competitors within the same industry.

Vertical integration, on the other hand, involves an organization acquiring other

companies within its supply chain system.

Related diversification is a substantive growth strategy that involves an organization

adding to its product line, similar or related products either through diversifying its
production or through acquiring other related products.

Unrelated diversification, on the other hand, occurs when an organization adds to its
product line, a different product (Assen, Berg and Pietersma, 2009). Samsung can use one
of these substantive strategies to grow and expand within the expand its market.

Retrenchment Strategies

There are two main retrenchment strategies that a company can use to facilitate its
growth.

Turnaround strategy involves an organization backing out of an earlier strategic decision

in order to reverse the process of decline in the company.

Divestment strategy, on the other hand, involves the sale or liquidation of a portion of
business, or a major division, profit centre or SBU. Divestment is usually a restructuring
plan and is adopted when a turnaround has been attempted but has proved to be
unsuccessful or it was ignored.