工商管理专业.pptxVIP

工商管理专业第1页/共27页 Vertical Integration Definitions Vertical Integration: refers to a firms’s ownership of the vertically related activities. The greater the firm’s ownership extends over successive stages of the value chain for its product, the greater the degree of vertical integration. The extent of vertical integration is indicated by the ratio of a firm’s value added to its sales revenue: the more a firm makes rather than buys, the greater its value added relative to its sales revenue.Vertical integration can be either backward, where the firm takes ownership and control of producing its own or other inputs, or forward, where the firm takes ownership and control of activities previously undertaken by customers.Vertical integration may be full or partial. Some Wineries are fully integrated: they produce the wine from the grapes they grow, and the sell it all through direct distribution. Some wineries in California and France do this. Most are partially integrated: home grown grapes supplemented with purchased grapes; they sell some wine through own tasting rooms, but most through independent distributors.第2页/共27页 Strategies: DIVERSIFICATIONDiversification two broad types:Related diversification is development beyond the present product and market, but still within the broad confines of the ‘industry’. For Example Unilever is a diversified corporation, but virtually all its interests are in the consumer goods industry.(a) Backward integration refers to inputs into the current business further back in the value system e.g. Raw materials, machinery, labour(b) Forward integration refers to activities which are concerned with the company’s outputs e.g. Transport, distribution, repairs, and servicing. These are further forward in the value system(c) Horizontal integration refers to activities which are competitive with or directly complementary to a company’s present activitiesUnrelated diversification refers to activity development beyond the present ind