Question
Please provide your thoughts about the below information when performing the vertical integration. 150 words explanation. Vertical integration into forwarding stages of the industry value
Please provide your thoughts about the below information when performing the vertical integration. 150 words explanation.
Vertical integration into forwarding stages of the industry value chain allows manufacturers to gain better access to end users, improve market visibility, and include the end users purchasing experience as a differentiating feature. (Gamble, et al., 2017., p. 121) JLG began to promote and market its access lift equipment for sale as well as the rental through its new and improved website. It has also partnered with Sunbelt Rental companies to develop, rent and sell its access lift equipment for various markets. Integrating with a major rental company such as Sunbelt allows JLG to sit back and allow its product to sell and rent themselves. This has been hugely successful that Sunbelt places large orders yearly with the company for various lifts as well as to recondition the current rental fleet to ensure that the machines are in the best shape for the customer.
Operations is always a unique opportunity and depending on the business depends on if the activities of the firm can truly be an opportunity. Again, JLG comes to mind for me as JLG has used vertical integration as much as possible within its manufacturing operations to reduce costs which can flow through the total cost of the finished good and then to the consumer. JLG does not take this process lightly as it will research costs within the current value chain against the operations team that is requesting to manufacture the raw material. This process is not taken lightly as the business wants to ensure that when it makes the decision to vertically integrate the raw material into its operation that it will continue to be fruitful and profitable.
Vertical Integration is the primary strategy for any company to advance its services not only within the current market but into additional markets that can help to get the company recognized globally. Management plays an essential part in all opportunities and decisions and making the critical choices to better the company should only be left in the hands of a capable team. Many other companies within different markets have used vertical integration as a strategy such as Harley Davidson, Allstate Insurance and Kaiser Permanente, Exxon Mobile, Birds Eye Vegetables just to name a few.
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