Growth in Retailing: Organic vs Inorganic

Boualem Aliouat () and Camal Gallouj ()
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Boualem Aliouat: GRM - Groupe de Recherche en Management - EA 4711 - UNS - Université Nice Sophia Antipolis (1965 - 2019) - UniCA - Université Côte d'Azur
Camal Gallouj: Université Sorbonne Paris Nord

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Abstract: This chapter examines growth within the retail sector by qualifying transaction cost theory. When defining its strategy, a company must consider the most relevant way to expand; in other words, how to increase its scale, innovation potential, market volume for its products or services, and ultimately, its performance or results. It faces a choice between internal (organic) growth and external growth. Both modes offer distinct advantages and constraints. However, they are not mutually exclusive, and retail firms can simultaneously rely on both forms. In practice, purely internal or purely external growth are merely ideal-types. The practices of retail companies are often intermediate, involving a skillful blend of both growth modalities. They can even be more complex still, utilizing for instance franchising, which can be presented as a hybrid model or a middle ground between internal and external growth.

Keywords: hybrid model; organic growth; innovation; retail; external growth; franchising (search for similar items in EconPapers)
Date: 2025-12-15
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Published in Edward Elgar Publishing. Elgar Ecyclopedia of Retailing, Edward Elgar Publishing, 2025, Elgar Encyclopedias in Business and Management, 978-1-0353-1969-5

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-05504056

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