What’s the integration?

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Integration happens when a company acquires another corporation with important resources or goods/services. It can reduce costs and improve quality. Integration can occur when a supplier’s product/service is attractive, or when multiple clients want to ensure the supplier’s survival. It can also be used to reduce the power of a supplier and manage input costs.

In the world of business, it is not unusual for a company to acquire another corporation that has resources or produces goods or services that are important for the company’s prosperity. When a company chooses to buy a corporation that has employed a proven supplier or proven vendor, this is known as integration at the moment. Here are some antecedents about how the integration works atrás and why this type of transaction can be attractive.

The integration process also generally begins when a company realizes that the product of the service line that one of the company’s suppliers offers is especially attractive. This attraction may be based on the fact that the products you are currently buying have worked very well and are helping to improve the quality and the final result.

As it seems that a wide-ranging relationship with the contractor seems imminent, a well-started company will start analyzing the general costs of doing business with the contractor. It seems that the procurement of the procurement officer and the integration of the supply chain into the corporate family would reduce the cost of inputs to a large extent, so you can contact the procurement provider about the change of procurement. Assuming that both parties are open to the idea of ​​acquisition, negotiations are opened and an agreement is eventually drawn up that is attractive to both parties.

In some cases, the integration has atrás ocurre no porque una sola compañía desee aquirir una compañía, until porque varios clientes del proveedor desean asegurarse de que la entity subreviva. As an example, a supplier who supplies benefits to three companies may have financial problems. I owe that the three companies do not want to find a new contractor, if a job relationship is established whereby one of the three companies brings recursos for the purchase and continuous operation of the contractor. Esta es a menudo una situación de ganar-ganar para todos. The vendor remains in the shop, and the customers continue to obtain the products in those that conform, at a reduced price.

Another application of integration hacia atrás implies dealing with supply chains where there is the need to reduce the power of the supplier above the unit cost. Like a medium to minimize revenue costs, a customer or group of customers can initiate a purchase from the provider. This helps to control the prover’s power, allowing each customer to better manage their individual input costs and quizás in general, more inputs from other customers of the received prover.

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