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Backward Integration

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Backward Integration
A business model whereby a company takes direct control of how its products are supplied. For example, a company may buy another company that previously supplied its raw material. That is, a butcher may own a ranch so that he does not have to buy slaughtered animals from an outside ranch. Alternatively, backward integration may involve the butcher buying the outside ranch. See also: Forward Integration.


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As part of its backward integration plan, the company has proposed to set up a facility at near Chennai for making office furniture and chairs.
Just as Sachin Tendulkar's contributions to the field of cricket have helped shape India's reputation in the world of sports, so has Mukesh Ambani's contributions to Reliance Industries and its key strategy of backward integration helped put India on the corporate map of the world.
He said it was a significant component of a backward integration plan and provided a competitive advantage over many major steel players in the region.
 
 
 
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