Business 1.5

Business growth

An increase in the size or scale of a business, such as an increase in sales, output, market share or number of employees.

Organic growth

Growth achieved through the expansion of a business's existing operations.

External growth

Growth achieved through mergers, takeovers, acquisitions or other agreements with external organizations.

Merger

An agreement in which two businesses combine to form one organization.

Takeover

When one business gains control of another business, usually by purchasing a controlling amount of its shares.

Acquisition

When one business purchases another business and gains control of it.

Joint venture

A business arrangement in which two or more organizations create and jointly own a separate business or project.

Strategic alliance

A cooperative agreement between two or more businesses that work together toward shared objectives while remaining independent.

Franchising

A method of business expansion in which a franchisor gives a franchisee the right to use its brand and business model in return for fees or royalties.

Franchisor

The business that grants another party the right to use its brand and business model.

Franchisee

The individual or business that receives the right to operate using the franchisor's brand and business model.

Economies of scale

Reductions in average cost per unit resulting from an increase in the scale of production.

Diseconomies of scale

Increases in average cost per unit resulting from a business becoming too large to operate efficiently.

Internal economies of scale

Cost advantages resulting from the growth of an individual business.

External economies of scale

Cost advantages resulting from the growth of the industry in which a business operates.

Globalization

The increasing integration and interdependence of economies, markets and businesses around the world.