Vertical Integration Assignment Help: Vertical Integration: Vertical integration can be used as a leadership tool to save the cost associated with the business operations. There are two ways of using vertical integration methods. First is backward integration, in that the organization can enter into an industry that produces the inputs to manufacture the products, offered by the organization. Second way is forward integration method in which the company can enter into an industry that sells its developed products to suppliers or uses distributors.
For example, if the organization knows its demand for core products, it can produce core product units. The company can schedule as well as coordinate the process to produce the required number of products in time. It will help the company to produce the products in a cost-effective manner. By using vertical integration method, the organization can strengthen its business model that further can help to become the industry leader. Vertical integration can help the firm to differentiate its products or lower its cost structure that is crucial to becoming the industry leader.
Our assignment helper says that this form of integration can be used by an organization as the most globally oriented integration. It is so, as it will help the organization to integrate its production facilities across borders that can be used as a business leading tool. In this, the production process or activities can be carried out in different locations as per the relative cost, resources and availability of raw materials for the production. MNEs can also attain control over the operations by using vertical integration. It will help the MNEs to lead the market in particular industry. For example, Apple and IBM have become an industry leader by using vertical integration method for international business.
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