ANALYZING THE IMPORTANCE OF VERTICAL INTEGRATION IN TEXTILE SECTOR OF PAKISTAN

Abstract

Vertical integration seems to be one of the best strategies in current business environment as there are a number of benefits as compared to the risk but if we analyze the risk factors it becomes high, for example: if the company goes for vertical integration and it needs to have strong management and expert people and they are not available then the it is not possible for the company to run in an effective manner. Specifically in textile sector where textile mills are having different departments and units e.g. Spinning, Weaving and Dying etc. the management of the entire department and their integration with each other is the most important thing if the company is going for vertical integration. It involves a huge cost as well, but this cost gives the benefit of long term as we have the example of Gulahmed and Alkaram textiles they have setup their own vertically integrated setups to ensure timely delivery, low cost and better quality all these combine to give customer satisfaction.