In a previous article we have been speaking about the vertical integration both backward and forward. It is time to introduce a new concept, the horizontal integration.
The simple definition of the horizontal integration is that it happens when two or more companies which produce the same or similar goods or provide the same/similar services merge together. When all the producers of goods/services merge, they create a monopoly. If on the other hand, they are still few competitors left after the merger there will be an oligopoly.
As in the case of vertical integration, horizontal integration has its own advantages and disadvantages. But first let’s take a look at some of the companies who have implemented this concept and to evaluate how successful they were. These are the examples of Horizontal integration. [Read more...]