Benefits of forward integration

Cards (3)

  • Forwards vertical integration: When a business merges with or takes over another business at the next stage in the production process. Allows the business to be closer to the end use of consumers, gives the business greater control in the marketplace
  • The manufacturer has a guaranteed outlet to sell their products: This means firms do not negotiate with retailers to stock their products.
  • The manufacturer has more control over price and the advertisement of the product: results in the business being able to control how the product is sold, how it is displayed and whether it has premium price or promotional offers attached to it. Important because these things can affect brand image