Backward Integration

Filed Under » Business

	Definition of 'Backward Integration' A form of vertical integration that involves the purchase of suppliers in order to reduce dependency.
	Investopedia explains 'Backward Integration' A good example would be if a bakery business bought a wheat farm in order to reduce the risk associated with the dependency on flour.

Related Definitions

Forward Integration

A business strategy that involves a form of vertical integration whereby activities are expanded to include control of the direct distribution of its products.
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Horizontal Integration

The acquisition of additional business activities that are at the same level of the value chain in similar or different industries. This can be achieved by internal or external ...
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Vertical Integration

When a company expands its business into areas that are at different points of the same production path.
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