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What are some advantages and disadvantages of horizontal integration?
Wiki User
∙ 11y ago
Horizontal integration is when a business such as a bakery buys another bakery to increase their capacity (the number of loaves of bread they can supply to customers)
Advantages of horizontal integration
Quick way for a business to expand without having to start a new factory from scratch
Can lead to economies of scale
Disadvantage of horizontal integration
The business can get too big too quickly causing problems with management of resources
This can lead to problems with communication and co-ordination as the newly bough business tries to fall in line with the existing company
May have too many staff - may have doubles of staff e.g. sales managers so may lead to redundancy
May have sold machinery that needs replacing
Staff may not adapt well to the change of management
Wiki User
∙ 11y ago
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