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External Growth - Coggle Diagram
External Growth
Mergers and Acquisition
Vertical integration
Netflix
Samsung
Amazon
Lateral integration
Cadbury and Schweppes
Nike and Adidas
Exxon and Mobil
Horizontal Integration
Nike buying Umbro
Walt Disney acquires 21st Century Fox
Marriott international acquires Starwood Hotels and Resorts
Conglomeration
Tata Group
Tata Chemicals
Tata Motors
Tata Steel
Taj Hotels
Takeovers
Microsoft and Yahoo!
Vodafone and Mannesmane
Coca-Cola and Monster energy drink
Advantages
Improved economic scales
Lower labor costs
increased market shares
Enhanced distribution capacities
Disadvantages
may destroy value or create
time-consuming
Distractions from a daily basis
unemployment
Conducted for wrong reasons
Joint Ventures
Examples
Sony and Erriccson
Mercedes and Volvo
Ford and Volkswagen
Google and NASA
Uber and Volvo
Advantages
Access to new markets
Increased capacity
Shared risks and costs
Increased knowledge and expertise
More resources
Disadvantages
Objectives are unclear
Communication becomes a hurdle
Different expectations
Level of expertise
Resources and work not split equally
Strategic Alliances
Examples
Spotify and Uber
Star Alliance Airlines
RedBull and GoPro
Disney and Chevrolet
Apple and MasterCard
Disadvantages
Communication challenges
Unequal benefits
company's reputation at risk
Culture and language barriers
Advantages
New clients
more opportunities and revenue
Multiple sources of income
Limited risk
New resources
Franchise
Examples
Starbucks
Taco Bell
Dominoes
Subways
KFC
Disadvantages
Limited creative opporutnities
Varied levels of support
Temporary contracts
Less individual control
Financial information shared with company
Advantages