this post was submitted on 14 Jun 2026
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Horizontal Integration Explained
Companies pursue horizontal integration for synergies like economies of scale or cost savings in marketing, R&D, production, and distribution. This can make manufacturing multiple products more cost-effective. Tiers of sale under a single distributor (economy and generic versus luxury or specialty) also afford the corporate entity to scale price to income and maximize revenue per customer.
The "organic" label is a good example of this in practice. Add a 50% mark-up on bananas by telling people the "regular" bananas are unsafe. Anyone who can't tolerate the professed risk (typically people with more disposable income) end up paying extra to the same distributor for what is functionally the same product sold at a premium price.
Automation and Mass Production are tools of monopolization in the capitalist economic model. The efficiencies of production are used to lock competitors out of the market, not to improve the consumer-experienced efficiency of production, distribution, or sale.
Thanks for the post and the link. Great explanation.
The short answer is that any benefit arising from the decrease in manufacturing costs through technology, scaling, etc. is considered the property of the manufacturer. You though those cost savings should be passed on to the customer. They disagree. Perhaps an even split? NO.