What does the term organic growth mean?

Organic growth often refers to the growth in a company's sales that did not occur because of an acquisition of another company. Expressed another way, organic growth is the internal growth or the growth from its existing businesses—not from the businesses it acquired during the period.

For example, a company's sales may have increased 25% during the past year. However, all of the sales increase was the result of having acquired a competitor. Therefore, it had no organic growth.

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