integration
- Created by: courtroberts
- Created on: 15-03-17 20:23
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- integration
- internal
- Invest in capital goods
- ^ capacity = ^ efficiency
- Invest in human capital
- train workers = ^ efficiency
- Invest in capital goods
- external
- Horizontal
- 2 companies in same industry - different sectors
- BREWERY/ PUB
- benefit from EOS
- ^ market share
- 2 companies in same industry - different sectors
- vertical
- 2 companies in same market
- CURRY'S/PCWORLD
- benefit from risk bearing EOS
- 2 companies in same market
- diversification
- merge of 2 firms with no common interests
- TATA STEEL
- ^ market share in 2 markets
- spreads risk
- merge of 2 firms with no common interests
- Horizontal
- Problems
- managerial disEOS
- cultural clashes in firms
- lack of knowledge
- X-inneficieny
- De-mergers
- when a business sells off the businesses it owns
- why de-merge?
- raise funds for investment
- decrease disEOS
- remove risk/losses
- Impacts
- consumers
- ^ consumer choice = lower prices
- businesses
- ^ comp = fall in market share
- workers
- ^ availability of jobs = ^ job security
- consumers
- internal
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