Theme 3 - Chapter 41 Key terms Flashcards
Define Vertical integration
A joining together into one firm of two or more firms at different production stages in the same industry.
Define Horizontal integration
A joining together into one firm of two or more firms in the same industry at the same stage of production.
Define Backward vertical integration
A joining together into one firm of two or more firms where the purchasers merges with one or more of its suppliers.
Define Forward vertical integration
A joining together into one firm of two or more firms where the supplier mergers with one or more of its buyers.
Define conglomerate integration
A joining together into one firm of two or more firms producing unrelated products.
Define Demerger
When a firm splits into two or more independent businesses.
Define Divorce of ownership from control
This occurs when the managers and directors of a business are a different group of people from the owners of the business
Define Market Niche
A small segment of a much larger market
Define a merger
The joining together of two or more firms under common ownership
Define Not-for-profit organisations
Organisations that do not have making profit as a goal but use any profit or surplus they generate to support their aims.
Define Organic or internal growth
A firm increasing its size through investment in capital equipment or an increased labour force.
Define Private sector organisations
Organisations that are owned by individuals or companies and not the state.
Define Public sector organisation
Organisations that are owned and controlled by the state.
Define Synergy
When two or more activities or firms put together can lead to greater outcomes than the sum of the individual parts.
