It is also referred to diversification. A firm may expand its present by innovation. An innovation is the adoption of a new idea, product or process which is prospectively useful. It refers to adopting anything new.
Expansion also refers to diversification. Product diversification can be an expansion in depth or in width. Depth of a product implies the assortment of colors, size, design, style, etc in the existing product. Width of a product implies introduction of related or similar product to the existing product. For e.g. if the existing product is bathing soap, then width refers to selling of washing soaps, along with bathing soaps. Product width is also referred to as product line. Expansion brings growth and stability to the organization. It adds to the profits.
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