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Answer:
Vertical integration is a strategy whereby a company owns or controls its suppliers, distributors or retail locations to control its value or supply chain. Vertical integration benefits companies by allowing them to control process, reduce costs and improve efficiencies.
Vertical integration can be regarded as process that involves acquiring business operations towards identical production.
- When a company opts for vertical integration, they tends to have control on some stages during production as well as distribution of a product.
- Vertical integration can as well be explained as merger of companies that are operating in same business even though they have different stages of production or distribution.
- For instance, Amazon can be regarded as one of the companies with vertical integration because it takes much stages of its business.
- Amazon doesn't only serves as marketplace for buyers or sellers ,but they do offers some of their products/ services, and they have their own distribution channel.
Therefore, Vertical integration has more stages in line of production.
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