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- Created 2012-03-02
, the term
describes a style of
. Vertically integrated companies in a
are united through a common owner. Usually each member of the supply chain produces a different
or (market-specific) service, and the products combine to satisfy a common need. It is contrasted with
. Vertical integration has also described management styles that bring large portions of the supply chain not only under a common ownership, but also into one corporation (as in the 1920s when the
Ford River Rouge Complex
began making much of its own steel rather than buying it from suppliers).
Vertical integration is one method of avoiding the
. A monopoly produced through vertical integration is called a
's example in the use of vertical integration led others to use the system to promote financial growth and efficiency in their businesses.
from Wikipedia (last updated: 25 May), licensed under
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Alfred DuPont Chandler, Jr.
Economic calculation problem
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