Horizontal integration is based on the exploitation capacity of the business in which one has already been operating.
It permits to fully exploit experiences, skills and soft skills and the know-how collected within years of work in the business the factory is specialised in.
All operations and ordinary activities (both internal and external) are now considered consolidated and as routine procedures thanks to the experience gained through operating in the field. The subjects who apply this internal growth strategy are effectively able to coordinate autonomously, to optimize production cycles because now procedures and technologies appear familiar and tested over time. This allows us to reach our goals, be efficient and economical: 3 essential characteristics that let a business to persist in the medium to long term.
The concept of horizontal development goes hand in hand with that of outsourcing: the company tries to “outsource” those processes that would threaten the efficiency and economic-financial stability of the company. To make this possible, it makes use of external partners such as various suppliers. At the same time it decides to “internalize” activities that allow it to differentiate itself and pursue competitive advantage in the best possible way. These operations, whether “outsourced” would require high transaction costs.
How could you pursue this growth path?
There are 3 ultimate strategies:
 The company still continue to sell the actual goods to the same markets. Products are already established and well placed (well-known) on the market as compared to the competitors’ ones. You can exploit your advantage by differentiating your offer and as a consequence limiting price competitions or avoiding replacing products consolidation. The main purpose is to get a leader position on the market.
 You offer a new product to an already existing market. The business doesn’t change at all, but actually its offer gets richer. You just modify or introduce innovation on the basis of further products. It is possible to improve as for quality, design and functionality. It is necessary to pay attention to the possible incoming replacing or complementary products (they’re similar, just some characteristics or the distribution channel are different and suitable for the clients target) on the market.
 The enterprise addresses its own products to a new segment of consumers, both geographically and practically talking/ meaning. The objectives are new territories, no matter if they are located in the same country or abroad. Basically the product is always the same, but we must try to advertise and lead it in the direction of new customers or target areas.