Vertical market

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In the national economy, a vertical market is a market in which goods and services from business areas of a value chain are offered in a specific industry .

Under certain circumstances, “complete solutions” are offered, that is, a bundle of goods and services from one business area. This bundle is put together specifically for the customer by the provider, which usually requires the customer's cooperation and excludes middlemen. However, the provider for his part will usually buy additional components for his solution.

An example can be a provider of telecommunication solutions that supplies a call center . The customer receives telephone sets , a telephone system. You lay the lines, connect a connection to the public telephone network . The customer receives software that shows the caller all important data. He is trained in questions of operation. The employees are trained to be call center agents , and finally the telephone connections are handled by the provider. The provider may also act as the leasing provider for the devices.

The business partners enter into a long-term relationship, as both have to learn a lot about their partner in order to ensure a successful cooperation. That brings planning security, but also dependency. It is therefore necessary to first build mutual trust, i.e. to get a feeling for the risks involved in the partnership.

Vertical markets did not develop to a greater extent until the end of the 20th century. Along with technical development and globalization , new business models are developing at an increasing rate , the successful implementation of which is only possible through the use of highly specialized devices, systems and methods. Since the associated knowledge is sometimes only required for a short time, namely in the introductory phase , it is uneconomical to employ your own experts . Instead, a company is commissioned to deliver, implement ( consulting ) and possibly also operate ( outsourcing ) the new solution .

See also