Growth & Development Vocabulary

A type of license that a party (franchisee) acquires to allow them to have access to the business's (the franchisor) proprietary knowledge, processes and trademarks in order to allow the party to sell a product or provide a service under the business's name.

A general term used to refer to the consolidation of companies. A merger is a combination of two companies to form a new company, while an acquisition is the purchase of one company by another in which no new company is formed.

The cooperation of two or more individuals or businesses in which each agrees to share profit, loss and control in a specific enterprise.

An arrangement between two companies who have decided to share resources in a specific project.

The increase in efficiency of production as the number of goods being produced increases. Typically, a company that achieves economies of scale lowers the average cost per unit through increased production since fixed costs are shared over an increased number of goods.

When a company expands its business into areas that are at different points of the same production path.

When a company expands its business into different products that are similar to current lines.

Organic Growth is the growth rate that a company can achieve by increasing output and enhancing sales. Inorganic Growth is a growth in the operations of a business that arises from mergers or takeovers, rather than an increase in the companies own business activity.

A corporation that is made up of a number of different, seemingly unrelated businesses. In a conglomerate, one company owns a controlling stake in a number of smaller companies, which conduct business separately.

A corporation that has its facilities and other assets in at least one country other than its home country.