Vertical Keiretsu

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Vertical Keiretsu

In Japan, a number of independent but related companies financed by a single bank and/or a joint stock company that controls every stage of the supply chain. For example, a mining company may sell a metal to a refinery in the same keiretsu, who then sells it to an auto company, who then sells cars to consumers. These consumers are often employees of the very same keiretsu because they have such strong company loyalty. Critics of this system contend that it is inefficient; proponents, however, argue that it is sustainable and has helped Japan recover from the post-war period.

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