Syllabus: SQA - Higher Course Spec Business Management
Module: Understanding Business
Lesson: Methods of Growth

Introduction

The “Methods of Growth” unit in the SQA Higher Business Management course forms part of the “Understanding Business” area of study. This unit equips students with an understanding of how and why businesses grow, and the strategic choices behind different types of growth. It aligns with the SQA’s goal of helping learners apply real-world business reasoning, communicate effectively, and evaluate economic decisions.

This topic supports progression in enterprise thinking, links strongly to curriculum goals around strategy and organisation, and builds the foundation for more complex strategic decision-making in further education or employment settings.

Key Concepts

Students need to be able to:

• Define business growth and explain why businesses aim to grow (e.g. to increase market share, reduce costs through economies of scale, or outcompete rivals).

• Understand and describe internal growth (organic growth), including:

  • Increasing sales of existing products

  • Launching new products

  • Expanding into new markets

  • Increasing capacity or hiring more staff

• Identify and explain external growth methods:

  • Merger: two firms agree to join together

  • Takeover: one firm buys a controlling stake in another

  • Franchising: expanding through the sale of business rights to other operators

  • Joint ventures and strategic alliances

• Evaluate the advantages and disadvantages of different growth methods for different business types.

• Understand potential diseconomies of scale and challenges of managing growth (e.g. coordination, control, finance).

Real-World Relevance

Teaching this topic comes alive when connected to current business activity:

• Greggs has demonstrated organic growth through new store openings and product expansion, particularly in travel hubs.

• Amazon used both internal (new product lines and services) and external (Whole Foods takeover) growth strategies to scale.

• Local examples: Many Scottish SMEs grow through franchising or entering strategic partnerships, particularly in the food and tourism sectors.

• Learners can relate growth decisions to their own experiences of high street changes or local business stories.

These connections help demystify business strategy and make abstract concepts more tangible for students.

How It’s Assessed

Assessment for this topic typically appears in both the question paper and assignment components of the Higher Business Management course. Students should expect:

• Explain and analyse questions on the different methods of growth

• Scenario-based questions asking students to recommend a growth strategy for a given business

• Compare and contrast tasks to evaluate methods (e.g. merger vs franchising)

• Use of command words such as:

  • “Describe” (state features)

  • “Explain” (give detail or reasons)

  • “Analyse” (break down and explore impact)

  • “Justify” (give reasons for a decision)

  • “Evaluate” (weigh pros and cons and conclude)

Encouraging students to plan extended responses using a clear structure (definition, explanation, example, implication) can improve outcomes.

Enterprise Skills Integration

This topic is a great springboard for embedding enterprise and employability skills:

• Decision-making: Choosing the right growth path involves weighing risks and rewards.

• Problem-solving: Analysing why a particular growth method may or may not succeed for a business.

• Teamwork and communication: Simulating a boardroom pitch for a growth strategy can encourage peer collaboration.

• Numeracy: When linked to profit, market share, or costs, this topic naturally supports basic financial literacy.

Use of simulation tools or business games where students play out growth strategies can deepen understanding and engagement.

Careers Links

This content aligns with Gatsby Benchmarks 4, 5 and 6, as it clearly connects classroom learning to business careers:

• Entrepreneurship: Students see how businesses scale and the strategic thinking involved.

• Business development roles: Understanding mergers, partnerships, and market expansion is key to roles in marketing, strategy, and operations.

• Real roles to highlight:

  • Business analyst

  • Growth manager

  • Franchise owner/operator

  • Investment banker (mergers and acquisitions)

  • SME founder or scale-up leader

Inviting guest speakers or using employer case studies can show how these concepts appear in real job paths.

Teaching Notes

Top tips:

• Use local case studies or school-linked businesses to ground abstract content.

• Set up a growth strategy challenge where students develop a plan for a local business.

• Encourage structured peer debate: which method of growth is best for business X and why?

• Include a simple financial exercise (e.g. projected revenue before and after a takeover) to build numeracy confidence.

Common pitfalls:

• Students often confuse internal and external growth. Clarify early with clear, repeated examples.

• Beware overuse of big brand examples only. Balance with SME or social enterprise examples to support wider understanding.

• Students may assume that growth is always positive. Challenge this with the concept of diseconomies of scale or failed takeovers.

Extension activities:

• Analyse real mergers (e.g. Sainsbury’s/Asda blocked merger) and their regulatory or market impacts.

• Students conduct mini research on a Scottish business and suggest viable growth options.