Bye to Vertical Integration and Welcome to the Horizontal Integration in the Textile Business

Muhammad Subhani (), Syed Akif Hasan and Amber Osman

MPRA Paper from University Library of Munich, Germany

Abstract: When it’s about production then association between the machinery and efficiency is gauged. This investigation seeks the matter whether vertical integration (balanced integration) in an organization provides better results and profits. The focused industry was textile with a sample size of 30 firms from Pakistan. It is to the interest of the textile owners and industry that vertical integration for a textile firm doesn’t really matter for the production efficiency in today’s world. There is something more to increase the production efficiency in regards to production facility and equipments used to generate outputs. Horizontal integration is a merger/acquisition/buyout with another same organization in the market that sustains one’s growth, increase production efficiency and monopoly in the industry. This integration is a matter of success for current situation of the micro and macro environment of this industry, which helps the textile firms to achieve the reduction in average cost (economies of scale) and increase the output.

Keywords: Textile industry; vertical integration; horizontal integration; production efficiency; economies of scope; economies of scale. (search for similar items in EconPapers)
JEL-codes: M2 M21 (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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