1.5.5—External growth methods

Mergers, acquisitions, takeovers, joint ventures, strategic alliances and franchising all obtain external growth, but they differ in control, speed, finance, risk and integration.

A merger combines organisations, an acquisition or takeover gives one firm control, a joint venture creates a jointly owned activity, an alliance coordinates without full ownership, and franchising lets others operate under a business model and brand. The right method depends on the capability and control required.

Choose the method by matching the desired control and speed with finance, partner risk and integration difficulty.

A restaurant wants rapid overseas presence but limited capital, so franchising transfers operating responsibility while preserving brand rules. Buying every outlet would give more control but require more finance and integration.

Calling every partnership a merger hides the ownership difference; name who controls what after the deal.