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External Growth Strategies. C ( a+b ). Merger: T wo firms combine to form a single new organization Takeover : One firm buys a controlling interest in another Strategic Alliance: Two firms work together in a business venture but remain independent firms
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External Growth Strategies C(a+b) Merger: Two firms combine to form a single new organization Takeover: One firm buys a controlling interest in another Strategic Alliance: Two firms work together in a business venture but remain independent firms Joint Venture: A strategic alliance, but within a separate legal entity formed by the participating companies Franchise: One company (franchisor) allows another company (franchisee) to use its name, brand, products, etc. in return for a license fee and royalties A B A A B B A B A B JV A B Franchise A has some control over procedures, quality, advertising, etc., but no ownership of Franchise.