The Difference Between Two Forms of Integration
Dali Horeshka, Business Consultant, Albania, Member
In my opinion the differences are related to 1. prices, 2. standards on quality, 3. agreement on rules to implement for being engaged within the same consortium or association, and 4. avoidance financial obligations to the state (tax).
For example. One of the main reasons farmers and industrialist are in conflict with each other is the level of purchasing price for the farmers' product versus the selling prices the industrialist can use to their consumers. The difference determines the level of the margins per unit of product and per working hour. The less difference or margin exist, the more functional is integration.
Another example: I pay taxes while you do not pay them. Consequently we have a different product cost level and you may sell with lower prices or have a higher margin.