Question

This week let’s discuss integration. 1. Name a company that practices horizontal integration and describe the structure. 2. Name a company that practices vertical integration and describe the structure. 3. In your opinion, which is better to work for? Which offers workers the better opportunity to better yourself? 4. If you owned the business, which would you implement? Think again about the workers opportunities. Does their betterment also mean what’s best for your business? Please number each question and provide one space between responses.

Answer 1

1. Horizontal Integration: Horizontal integration is the process of a company increasing production of goods or services at the same part of the supply chain.

For Example: After reaching a certain level of success, Walt Disney has been considering ways to expand and increases profits. Disney started out as an animation studio targeting children and families, which also represent their currently core target audience. However, in the process of diversifying and developing their company, disney did a horizontal into live action films (for example, Pirates of the caribbean series). In this manner the company managed to reach new audience and control a bigger share of the film industry.

2. Vertical Integration: Vertical integration is a process which is undertaken by the company to improve its control over the supply chain and give a better managed, more efficient and highly controlled supply chain. It mainlt involves the parent company as well as its vendors and customers

There are three types of vertical integration

• Backward vertical integration
• forward vertical integration
• Balance vertical integration

for Example: Apple Inc. is one of the best known companies for perfecting the art of vertical integration. The company manufactures its custom A-series chips for its iphones and ipads. The company has also integrated forward as much as backward. The Apple retail model, one where the company's products are almost exclusively sold at company owned location, excluding best buy and other carefully selected retailers, allows the business to control its distribution and sale to the end consumer.

3 In my opinion, Vertical integration is better, because of it increases it retails outlets. so that high profits will be generated through vertical integration whether Forward or Backward. Vertical integration only provides better opportunity to many workers, because of company may invite the franchises and outside retailers, so it will give more for many workers in the company.

4. If i owned the any business i would implement the 2nd option that is vertical integration, because of if i sell my fame and name of company by Franchises, so it will give me the much more benefits than from horizontal integration.