Definition: A Horizontal Marketing system is a form of distribution channel wherein two or more companies at the same level unrelated to each other come together to gain the economies of scale. In other words, Horizontal marketing system is the merger of two unrelated companies who have come together to exploit the market opportunities. Generally, this type of
marketing system is followed by companies who lack in capital, human resources, production techniques, marketing programs and are afraid of incurring the huge losses. In order to overcome these limitations, the companies join hands with other companies who are big in size either in the form of joint venture –that can be temporary or permanent, or mergers to sustain in the business. Horizontal marketing system has gained popularity in the recent times due to an immense competition in the
market where everybody is striving to gain a good position in the market along with huge profits.  In this marketing system, the collaboration can be between:
Examples of Horizontal Marketing:
Thus, two or more companies join hands to capitalize on the expertise of each and capture a greater market share. Reader InteractionsA joint venture is a common way of combining the resources and expertise of two otherwise unrelated companies. There are many benefits to this type of partnership, but it is not without risks - arrangements of this sort can be highly complex. Advantages of joint ventureOne of the most important joint venture advantages is that it can help your business grow faster, increase productivity and generate greater profits. Other benefits of joint ventures include:
Joint ventures often enable growth without having to borrow funds or look for outside investors. You may be able to:
Another benefit of a joint venture is its flexibility. For example, a joint venture can have a limited lifespan and only cover part of what you do, thus limiting the commitment for both parties and the business' exposure. Joint ventures are especially popular with businesses operating in different countries, eg within the transport and travel industries. Read about the different types of joint venture. Disadvantages of joint ventureJoint ventures can pose significant risks relating to liabilities and the potential for conflicts and disputes between partners. Problems are likely to arise if:
Partnering with another business can be complex. It takes time and effort to build the right business relationship and, even then, it can be difficult to completely avoid all the issues. Success depends on good communication, a carefully planned joint venture relationship and a clear joint venture agreement. When two or more companies unrelated come together to take benefit of an emerging marketing opportunity is?In other words, Horizontal marketing system is the merger of two unrelated companies who have come together to exploit the market opportunities.
What is channel conflict in marketing management?Channel conflict is a situation in which channel partners have to compete against one another or a vendor's internal sales department. Channel partners, such as value-added resellers and IT services providers, comprise a vendor's indirect sales arm.
What is vertical marketing system example?Contractual Vertical Marketing System
Organizations sign contractors with distributors to sell their products and remain competitive in a cut-through industry. An example of a contractual vertical marketing system is working with a franchise. In order to open a franchise store, a license must be purchased.
What is corporate vertical marketing system?a system of distribution channel organisation in which the orderly flow of products from producer to end-user is controlled by common ownership of the different levels of the system.
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When two or more companies unrelated come together to take benefit of an emerging marketing opportunity?
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