Agricultural marketing

 
Types of market integration :  
1. Horizontal integration :
Ø When a firm gains control over other firms, performing similar marketing functions. 
Some marketing agencies (say, sellers) combine to form a union with a view to 
reducing their effective number and the extent of competition in the market.
Ø Horizontal integration is advantageous for the members who join the group. 
Ø If farmers join hands and form cooperatives, they are able to sell their produce in 
bulk and reduce their cost of marketing. 
Ø Horizontal integration of selling firms is not in the interests of consumers or buyers.
2. Vertical integration :
 

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Ø Occurs when a firm performs more than one activity in the sequence of the 
marketing process.
Ø It is linking together of two a more functions within a single firm or under a single 
ownership.
Eg: - 1. If a firm assumes the functions of the commission agent as well as retailing.
2. Floor mill which engages in retailing activity as well.
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Vertical integration leads to some economies in the cost of marketing.
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Enjoys greater market power while reducing the number of middlemen.
There are two types of vertical integration 
a). Forward integration :
Eg: Wholesaler assuming the function of retailing i.e. assuming another function.
b). Backward Integration:
Eg: Processing firm assumes the function of assembling / purchasing the produce from 
villages.
Firms often expand both vertically and horizontally. Eg: Modern retail stocks.
Horizontal : Expanding either retail stores or number of commodities they deal.
Vertical : Operate their own wholesale, purchasing and processing establishment.
3. Conglomeration: 
A combination of agencies or activities not directly related to each other, may 
when it operates under a united management, be termed a conglomeration.
Eg: Hindustan Lever Ltd. Delhi cloth and General mill (cloth & vanaspati).