Final answer:
Vertical integration is a business strategy where a company gains control over all aspects of a product's lifecycle, from raw materials to sales, often leading to market dominance and the ability to make strategic production and pricing decisions.
Step-by-step explanation:
The business practice described, wherein a company expands control over all phases of a product's lifecycle, is known as vertical integration. This strategy was notably utilized by industrialists like John D. Rockefeller during the Industrial Revolution. Vertical integration allows a company to manage every step from the procurement of raw materials to the manufacturing and the final sale of the product. By dominating all these aspects, businesses have the power to expand or reduce production, set the price they choose, open or close factories, hire or lay off workers, and decide whether to launch new products or discontinue existing ones.
Implementing vertical integration grants companies significant market control, enabling them to buy out competitors, dictate terms, and make strategic decisions that further entrench their position in the industry. The result of such practices is often a monopoly or near-monopoly, where the vertically integrated company becomes the dominant force in its market, with considerable influence over supply chains and consumer prices.