Consolidated Industries Case Study

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A Business can go in two paths for development.
One of them is providing the product to consumers at low cost and to generate interest to the customers. What happens when the prices are cut down are customers can get the product they need and also have some savings which will bring in their interest in the company and thus increase the product value and company’s value. Some of the things that needs to be done to reduce the prices are, cut down production prices and management prices , outsourcing some of the work like production to places with lower costs etc.,
Second path that the company can follow to increase the company’s value is to increase the product quality to provide the best quality. Even if prices are a little more, a company
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In a consolidated market there a few players diving the market among themselves and with this, they make the market rules as there is no one to question them. In some situations, consolidated market also can be competitive but it does not happen more frequently. Generally more acquisitions of the business markets happen in a consolidated market. This helps in a way to increase the research and development of the product as there are much more resources available as the players are big.
Consolidated industries by the name means that the industries try to acquire the smaller industries in their market competition or the companies that can be helpful to increase the quality of the product and also to reduce the costs. For example Microsoft is a very big industry which consolidates the market by acquiring the technology companies that can be helpful for increasing their products quality, research and development and add more features to their product. Consolidation increases the resources that a company can provide for research and development and so that a company can increase the quality of the product and also reduce costs of production
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This helps the company by increasing its hand in the total life cycle of the product. This increases the power of the company to decide anything that can be done with the product.
This is because, if you consider a product, its just not the company whose name is printed on the product but there are many other parties involved in the design, production and post production process of the product but the company on the products label is the one who decides anything.
Horizontal integration on the other hand is a strategy where a company involved in a phase of the product goes and acquires the company that can be used in the next phase and continues building the product. This is a type of integration where a company acquires the company in the same value chain to increase its size, resources and reduce the production prices, cutting down management costs etc., to offer a better value to the customer. This is what consolidation of the market is, which also increases the R&D of the product so that the company can increase its

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