Horizontal integration

In business, horizontal integration is a strategy where a company creates or acquires production units for outputs which are alike – either complementary or competitive. One example would be when a company acquires competitors in the same industry doing the same stage of production for the creation of a monopoly. Another example is the management of a group of products which are alike, yet at different price points, complexities, and qualities. This strategy may reduce competition and increase market share by using economies of scale. For example, a car manufacturer acquiring its competitor who does exactly the same thing.