As margins became smaller, flocks became larger, and soon the feed dealer became the source of credit. As the industry grew, the feed dealers began to depend on the manufacturers as a source of funds. To spread their risk, both feed dealers and feed manufacturers integrated vertically with hatcheries and processors. This was the start of industry integration. Several forms of integration apply to broiler production Horizontal integration is the combination of firms in the same stage of production, often resulting in better control of production and increased efficiency.
Vertical integration is the control by a single management of two or more stages of production.
Eighty percent of all commercial broilers are produced by the top 10 broiler companies. These vertically integrated firms produce broilers on company-owned farms or farms operated by contract growers who own their farms and are paid by the pound for broilers produced. Vertically integrated firms carry out all activities in broiler production, from hatching through delivery to buyers.