$69 postpage LB

What is vertical integration?

  • December 03, 2020 08:26 PM AEDT
  • Team Kalkine

Vertical integration is an arrangement of an enterprises’ supply chain in a way that helps to fit in different stages of the production process and supply chain into its business. A company may seek to create a competitive advantage by housing every outsourced operation. The intention of vertical integration is not only to gain market superiority but also for securing distribution channels and optimizing cost structure. In nutshell, it is used to have control over the Industry’s Value Chain.

There are two types of vertical integration: forward integration and backward integration. 

Forward integration is when a business controls retailers and distributors of its products. An example of this could be an oil and gas company with gas stations.

Backward integration is a vertical integration strategy where a business seeks to control suppliers, and therefore the inputs used in the production of goods or services.

Gold MTF non-AMP

 


Disclaimer
The website https://kalkinemedia.com/au is a service of Kalkine Media Pty. Ltd. (Kalkine Media) A.C.N. 629 651 672. The principal purpose of the content on this website is to provide factual information only and does not contain or imply any recommendation or opinion intended to influence your financial decisions and must not be relied upon by you as such. Some of the content on this website may be sponsored/non-sponsored, as applicable, but is NOT a solicitation or recommendation to buy, sell or hold the stock of the company (or companies) or engage in any investment activity under discussion. We are neither licensed nor qualified to provide investment advice through this platform. In providing you with the content on this website, we have not considered your objectives, financial situation or needs. You should make your own enquiries and obtain your own independent advice prior to making any financial decisions.
Some of the images that may be used on this website are copyright to their respective owner(s). Kalkine Media does not claim ownership of any of the pictures displayed on this website unless stated otherwise. The images that may be used on this website are taken from various sources on the web and are believed to be in public domain. We have used reasonable efforts to accredit the source (public domain/CC0 status) to where it was found and indicated it below the image. The information provided on the website is in good faith, however Kalkine Media does not make any representation or warranty regarding the content, accuracy, or use of the content on the website.

 

   
We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it. OK