Strategy
Horizontal integration
Combining with firms at the same stage, often competitors.
Facts checked against sources onWhat does Horizontal integration mean?
Horizontal integration means merging with or buying companies at the same stage of the value chain, often competitors, to gain scale, market share or reach. Competition authorities review large deals of this kind.
Where does it come up in case interview prep?
- Competition law: mergers, cartels and abuse of dominanceLesson in People, rules and responsibility: organisation, regulation and sustainability
- Logistics players, hubs and trade lanes, trends 2024 to 2026, and how to crack the casesLesson in Logistics, shipping, ports and supply-chain services
- Packaging players, trends 2024 to 2026, and how to crack the casesLesson in Paper and packaging
Related terms
- Vertical integrationOwning more stages of your own supply chain.
- SynergyExtra value created when two businesses combine.
- Economies of scaleCost per unit falls as volume rises.
- Economies of scopeCost falls when related products share resources.
- Barriers to entryWhat makes it hard for new competitors to enter a market.
- Switching costsThe cost or effort for a customer to change supplier.
- Network effectsA product becomes more valuable as more people use it.
- Competitive advantageWhat lets a firm earn more than its rivals over time.
Learn it in context
See Horizontal integration at work in a lesson from People, rules and responsibility: organisation, regulation and sustainability, with checks as you go.
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