The Vertical Integration Strategies Approach for Organizational Risk Reduction

The vertical integration decision poses strategicchallenges for a firm’s marketing channels’decision prerogatives which drive its businessstrategy. This paper explicates those putativebenefits of vertical integration as organizationalstrategy adopted by firms for alleviatingrespective transaction costs and optimizingfunctional governances of the business system inthe enterprise. The discourse concentrates on thedynamics of the varied vertical integrationmechanisms like joint ventures, mergers, andcontracting agreements practiced by firms toserve as risk reduction strategies in the businessexchange process