Inorganic growth
Encyclopedia
Inorganic growth is the rate of growth of business
, sales expansion etc. by increasing output and business reach by acquiring new businesses by way of mergers, acquisitions
and take-overs. This kind of growth also takes place due to government directives, leading to enhancement of business in some identified priority sector/area. The inorganic growth rate also factors in the impact of foreign exchange movements or performance of other economies.
As opposed to the organic growth
, this kind of growth is affected to a great extent by exogeneous factors. It is also a faster way for companies to grow compared with organic growth
(where the main focus is productivity enhancement and cost reduction).
This term is usually related with financial sectors showing expanding business and profits.
Business
A business is an organization engaged in the trade of goods, services, or both to consumers. Businesses are predominant in capitalist economies, where most of them are privately owned and administered to earn profit to increase the wealth of their owners. Businesses may also be not-for-profit...
, sales expansion etc. by increasing output and business reach by acquiring new businesses by way of mergers, acquisitions
Takeover
In business, a takeover is the purchase of one company by another . In the UK, the term refers to the acquisition of a public company whose shares are listed on a stock exchange, in contrast to the acquisition of a private company.- Friendly takeovers :Before a bidder makes an offer for another...
and take-overs. This kind of growth also takes place due to government directives, leading to enhancement of business in some identified priority sector/area. The inorganic growth rate also factors in the impact of foreign exchange movements or performance of other economies.
As opposed to the organic growth
Organic growth
In finance, organic growth is the process of businesses expansion due to increasing overall customer base, increased output per customer or representative, new sales, or any combination of the above, as opposed to mergers and acquisitions that are examples of inorganic growth. Typically, the...
, this kind of growth is affected to a great extent by exogeneous factors. It is also a faster way for companies to grow compared with organic growth
Organic growth
In finance, organic growth is the process of businesses expansion due to increasing overall customer base, increased output per customer or representative, new sales, or any combination of the above, as opposed to mergers and acquisitions that are examples of inorganic growth. Typically, the...
(where the main focus is productivity enhancement and cost reduction).
This term is usually related with financial sectors showing expanding business and profits.