Horizontal integration

Horizontal integration is the process of a company increasing production of goods or services at the same level of the value chain, in the same industry. A company may do this via internal expansion, acquisition or merger.

The process can lead to monopoly if a company captures the vast majority of the market for that product or service.Other benefits include, increasing economies of scale, expanding an existing market or improving product differentiation.

Horizontal integration contrasts with vertical integration, where companies integrate multiple stages of production of a small number of production units.