Levels of

Diversification
 Low Level

 Small Business : Firm generates 95% or more of it’s sales

from it’s core business area.

 Example: Supper Shop

 Dominant Business: Firm generates 70-95% of
total sales revenue within a single business area.
 Example: Photo Studio Shop
 Moderate to high levels
nstrained: Less than 70% of revenue comes from the dominant business and
hare product , technologies and distribution linkages, means direct link betw

S
uare Group

mical
n

S
Related linked ( Mix related and unrelated) : Less than 70% of revenue comes from the
dominant business and there are only limited links between businesses. Linked firm
sharing fewer resources and assets among their businesses compare to related
constrained , concentrating on the transfer of knowledge and competencies among the
businesses.

Square Spinning Square

Limited Textile

Astras Limited
 Very high level diversification
 Unrelated Diversification: Less than 70% revenue comes from the
dominant business and there are no common links between businesses,
means no relationship between businesses.

Square
Health care
consumer
products

Square Toiletries