Types of business collaborations - SS1 Commerce Lesson Note

Consortium:

A consortium is a collaboration or partnership between multiple companies or organizations working together on a specific project or venture. The members of a consortium contribute their expertise, resources, and capabilities to achieve a common goal. It allows companies to share risks, costs, and knowledge, enabling them to undertake larger projects that may be beyond their individual capacities.

Cartel:

A cartel is an agreement or collaboration between competing companies in the same industry to restrict competition and control market conditions. Cartels are generally illegal and considered anti-competitive behavior. Members of a cartel coordinate their actions, such as fixing prices, limiting production, or allocating market shares, to maximize their own profits at the expense of fair competition and consumer welfare.

Amalgamation/Merger/Combination:

Amalgamation, merger, or combination refers to the joining together of two or more companies to form a new entity or integrate their operations. It typically occurs when companies see the benefits of combining their resources, capabilities, and market presence to create a stronger and more competitive organization. Amalgamation/merger can lead to synergies, economies of scale, expanded market reach, and improved efficiency. It can occur through various methods, such as a purchase of shares, asset transfer, or a legal consolidation of businesses.

Trust Holding:

A trust holding, also known as a trust or holding company, is a type of organization that controls and manages the shares or assets of multiple companies. It is established to exercise control or influence over the operations and decision-making of its subsidiary companies. A trust holding can help centralize management, facilitate strategic planning, and provide financial and administrative support to its subsidiaries. It can also offer advantages in terms of tax planning, risk management, and resource allocation.