Question

what is vertical integration?

Answer 1

When a company expands its business into areas that are at different points on the same production path, such as when a manufacturer owns its supplier and/or distributor. Vertical integration can help companies reduce costs and improve efficiency by decreasing transportation expenses and reducing turnaround time, among other advantages. However, sometimes it is more effective for a company to rely on the expertise and economies of scale of other vendors rather than be vertically integrated.

Answer 2

Examples of vertical integration include:
- A mortgage company that both originates and services mortgages, meaning that it both lends money to homebuyers and collects their monthly payments.

Answer 3

@madhu.mukherjee.946 please don't forget to cite your sources. Thanks!
http://www.investopedia.com/terms/v/verticalintegration.asp