Horizontal integration is defined as:

Horizontal integration is defined as:

• A. When a business expands at different but related levels in the production and selling of a product
• B. When a business expands with another business in a completely unrelated industry
• C. When a business expands into a new market through franchising
• D. When a business vertically integrates with its supplier

Answer: (B)

Horizontal integration is a growth strategy where a company expands by merging with or acquiring another business in the same industry and at the same level of the production or distribution process. This boosts market share, can lead to economies of scale, and reduces competition by bringing competitors under one roof. For example, a chocolate company buying another chocolate manufacturer to control more of the chocolate market illustrates horizontal integration. Expanding into an unrelated industry is diversification, which means broadening into different products or sectors rather than growing within the same line of business. Vertical integration would involve owning parts of the supply chain, such as a company acquiring its supplier or its distributor. Franchising grows the business by licensing the brand to independent operators, not by merging with another firm in the same industry.

Horizontal integration is a growth strategy where a company expands by merging with or acquiring another business in the same industry and at the same level of the production or distribution process. This boosts market share, can lead to economies of scale, and reduces competition by bringing competitors under one roof. For example, a chocolate company buying another chocolate manufacturer to control more of the chocolate market illustrates horizontal integration.

Expanding into an unrelated industry is diversification, which means broadening into different products or sectors rather than growing within the same line of business. Vertical integration would involve owning parts of the supply chain, such as a company acquiring its supplier or its distributor. Franchising grows the business by licensing the brand to independent operators, not by merging with another firm in the same industry.