2. Market integration occurs when prices among different locations or
related goods follow similar patterns over a long period of time. Groups
of goods often move proportionally to each other and when this relation
is very clear among different markets it is said that the markets are
integrated.
3. Types of market integration
1. Horizontal integration
This occurs when a firm or agency gains control of other firms or agencies
performing similar marketing functions at the same level in the marketing
sequence. In this type of integration, some marketing agencies combine to form
a union with a view to reducing their effective number and the extent of actual
competition in the market. It is advantageous for the members who join the
group.
2. Vertical integration
This occurs when a firm performs more than one activity in the sequence of the
marketing process. It is a linking together of two or more functions in the
marketing process within a single firm or under a single ownership. This type of
integration makes it possible to exercise control over both quality and quantity
of the product from the beginning of the production process until the product is
ready for the consumer. It reduces the number of middle men in the marketing
channel.
4. a) Forward integration
If a firm assumes another function of marketing which is closer to the
consumption function, it is a case of forward integration. Example: wholesaler
assuming the function of retailing.
b) Backward integration
This involves ownership or a combination of sources of suppl. Example: when a
processing firm assumes the function of assembling/purchasing the produce
from the villages.
3. Conglomeration
A combination of agencies or activities not directly related to each other may,
when it operates under a unified management, be termed a conglomeration.
