HORIZONTAL INTEGRATION Meaning and
Definition
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Horizontal integration is a business strategy that refers to the expansion and consolidation of a company's operations within the same industry, by acquiring or merging with other companies of similar nature. The main objective of horizontal integration is to strengthen the market position, increase market share, and achieve economies of scale.
In horizontal integration, a company attempts to acquire or merge with its competitors, suppliers, or distributors, with the aim of gaining a larger share of the market. This integration allows the company to expand its product offerings, enter new markets, and utilize resources and capabilities more efficiently. Through the consolidation of operations, companies can eliminate redundant functions, reduce costs, and streamline their production processes.
Horizontal integration can provide numerous benefits to the company, including enhanced market power, increased bargaining power with suppliers and buyers, improved distribution channels, and the ability to offer a wider range of products or services. By eliminating competitors or combining resources, the company can also reduce competition and potentially increase profitability.
However, horizontal integration also presents certain risks and challenges. It may lead to a concentration of market power, potentially resulting in antitrust issues, decreased competition, and reduced consumer choice. Additionally, the integration process can be complex and costly, requiring effective management and integration of different cultures, systems, and processes.
Overall, horizontal integration is a strategic move undertaken by a company to expand its business operations within the same industry through acquisitions or mergers, aiming to achieve competitive advantages, economies of scale, and increased market presence.
Common Misspellings for HORIZONTAL INTEGRATION
- gorizontal integration
- borizontal integration
- norizontal integration
- jorizontal integration
- uorizontal integration
- yorizontal integration
- hirizontal integration
- hkrizontal integration
- hlrizontal integration
- hprizontal integration
- h0rizontal integration
- h9rizontal integration
- hoeizontal integration
- hodizontal integration
- hofizontal integration
- hotizontal integration
- ho5izontal integration
- ho4izontal integration
- horuzontal integration
Etymology of HORIZONTAL INTEGRATION
The etymology of the word "horizontal integration" can be broken down as follows:
1. Horizontal: The word "horizontal" originates from the Latin word "horizontem" which means "the direction of the horizon" or "level". It comes from the Latin verb "horizō" meaning "to limit, bound". The term "horizontal" refers to something that is parallel to the horizon or perpendicular to the vertical axis.
2. Integration: The term "integration" comes from the Latin word "integratio" meaning "renewal, restoration". It is derived from the Latin verb "integrare" which means "to make whole, restore, or renew". In the context of business and economics, "integration" refers to the process of combining different elements, entities, or functions into a unified system.
Similar spelling words for HORIZONTAL INTEGRATION
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