List and discuss some guidelines for when forward integratio

List and discuss some guidelines for when forward integration would be a particularly good strategy to pursue.

Solution

Ans:-Some guidelines for when forward integration would be a particularly good strategy to pursue.:-

(1) when an organization’s present distributors are especially expensive,unreliable, or incapable of meeting the firm’s distribution needs;

(2) when theavailability of quality distributors is so limited as to offer a competitive advantage tothose firms that integrate forward;

(3) when an organization competes in an industrythat is growing and is expected to continue to grow markedly;

(4) when anorganization has both the capital and human resources needed to manage the newbusiness of distributing its own products;

(5) when the advantages of stableproduction are particularly high; and

(6) when present distributors or retailers havehigh profit margins.