Question

Has Office Depot ever pursued a horizontal integration strategy? What was the strategic reason for pursuing this strategy ?

Answer 1

answer-

Office Depot, Inc. is an American office supply retailing company headquartered in Boca Raton, Florida, United States. The company has combined annual sales of approximately $11 billion, and employs about 38,000 associates with businesses in the United States. The company operates 1,400 retail stores, e-commerce sites and a business-to-business sales organization.

Yes, Office depot pursued a horizontal integration strategy. It is a strategy where a company acquires, mergers or takes over another company in the same industry value chain. The company Office depot pursued was OfficeMax.

OfficeMax was an American office supplies retailer founded in 1988. It is now a subsidiary of Office Depot, Inc., which is headquartered in Boca Raton, Florida. As of December 2012, OfficeMax operated 941 stores in 47 states, Puerto Rico, the U.S. Virgin Islands and Mexico. In 2012, net sales were $6.9 billion, down from $8.3 billion in 2008 .

The reason for pursuing this strategy was to reduce the competition in the industry, increase customer base and market share and expand its business operation to increase its profit margin.