Independent vs conglomerate company Unit 1 Section 1

PROS(independent):
1.  Flexibility and freedom
2.  You can earn more money
3.  You get tax benefits 
4. Control over all decisions 
5. Much more independence 
6. Gain skills quicker 
7. You can choose when to open and close the business 
8. There is no compete zone
9. Begin on a fresh note
10. No legal requirements fixed by the earlier business owner



CONS(independent):
1. You have extra administration 
2. No guarantee of work
3. Limited job security 
4. Your alone for benefits 
5. Takes plenty of time to build up the name meaning you might not earn big money
6. Success rate isn't always high 


CONS(conglomerate):
1. Lack of common identity
2. The company will only be successful if it has high quality of management, financial ability at head office where diverse operations are brought together.
3. Failure in the company it will drag down the rest
4. Lack of management experience


PROS(conglomerate):
1. If there is too much competition, you can escape
2. Entering new products into the market offers protection against failiure of current products
3. The company has the ability to move to high growth profitable industries. This is important as if the current industry is in decline the company can still make its money.
4. The company has better access to capital markets





DEFINITIONS:

Commercial: making or intend to make profit 


Vertical integration:The production company has complete ownership of the production, distribution and exhibition of the film

Horizontal integration: A production company expands into other areas of one industry. It is shared across.

Production process: combining various material inputs and immaterial inputs in order to make something for consumption. It is the act of creating output, or a good service which has a value and contributes to the utility of individuals