Benefits of company integration

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The need for unification is due to the interrelation of the functions performed. Integration is associated with the following advantages:

increase in market size;

manifestation of the effect of scale of production;

expanding borders and providing better terms of trade;

improving infrastructure and disseminating the latest technologies.

At the same time, experts draw attention to a number of negative consequences of integration, including:

the transfer of the bulk of production factors to more successful partners;

the effect of losses malta email list from business scaling;

the conclusion of agreements between market leaders, as a result of which certain categories of goods begin to rise in price.

Benefits of company integration

Source: shutterstock.com

Authoritative Russian and foreign scientists identify the following main motives for the formation of integration structures:

increasing economic and social advantages as a result of concentration of production and generalization of acquired experience;

increasing the efficiency of production activities (increase in production volumes, stabilization of the market position, transition to export, use of borrowed funds, reduction of costs for analytics, promotion, information support);

increasing the efficiency of financial activities (pooling financial resources, increasing the return on investment, increasing the value of shares, etc.);

increasing the efficiency of trade and intermediary activities (establishing relationships with suppliers, increasing the volume of transactions, implementing high-quality and timely deliveries);

positive consequences of monopolization;

reduction of actual business development costs due to the effect of scale;

obtaining a positive effect through the gratuitous transfer of technologies and patents into common ownership;

the positive impact of coordination of companies' activities on business results.