Horizontal Combination and its Advantage

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Offline Shah Alam Kabir Pramanik

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Horizontal Combination and its Advantage
« on: April 03, 2017, 04:37:17 PM »
Horizontal Combination:
It is also known as parallel or trade unit integration. It is affected by units engaged in manufacturing similar products or rendering similar services. It involves the brining together of the firms who are in the same level or may be the competing firms under single ownership and management. For example, if two or more sugar mills are combined under the same management, it will be a case of horizontal combination.
The benefits of horizontal combinations:

(i) It eliminates wasteful inter-firm completion in the same line of industry.
(ii) It helps in achieving economies of large scale production and distribution.
(iii) It can control supply of the product and market prices.