backward integration is a form of vertical integration in which firm's control of its inputs or supplies. forward integration is a form of vertical integration in which firm's control of its distribution.

Backward integration is vertical integration that combines a core business with its suppliers.

The advantages of backward integration may include assurance of the pricing, quality and availability of supplies, and efficiencies gained from coordinating production of supplies with their consumption. There are other means to these ends: for example, derivatives can hedge changes in the price of supplies, while working closely with suppliers can deliver the other gains.

vertical