Students often confuse these three strategies. Horizontal growth is the expanding of a firm’s
activities into other geographic regions and/or by increasing the range of products and
services offered to current markets. It often involves the acquisition of another firm in the
same industry (an example of external growth), but it could also be through the expansion of
a firm’s products in its current markets (e.g., through line extensions) or expansion into
another geographic region (an example of internal growth). One example of external
horizontal integration would be if Anheuser-Busch bought Coors. An internal example was
Coors’ expansion into the eastern U.S. Vertical growth, in contrast, involves a firm’s taking
over a function previously performed by a supplier or a distributor. This would typically
involve the addition of activities in other industries either forward (downstream) or backward
(upstream) on the industry value chain of current products or services. The additions are
