Parallelization
Parallelization involves a company broadening its offerings or services. Parallelization is the opposite of specialization. By expanding its product range, the company expects to be able to sell more to its existing customer base and also serve additional customers with the larger offering.
Growth through parallelization
An example of parallelization is grocery stores, which have slowly expanded or been replaced by supermarkets. The success of the supermarket is due both to its self-service concept and its wide range of products, which includes fresh produce such as vegetables, meat and bread. In recent decades, large supermarkets have continued to expand their offerings to include non-food items.
Manufacturers who parallelize usually expect to increase production in this way. This may require expansion of production and distribution facilities. Often, the goal is also to use existing capacity more effectively.
Disadvantages of parallelization
When parallelization leads to branch blurring, it can also have adverse consequences. For example, the rise of supermarkets caused a significant reduction in the number of specialty stores such as butchers, bakers, greengrocers and, for example, the milkman.
In addition, the fact that large-scale stores and businesses with broad offerings are becoming increasingly similar also poses a risk. Businesses often have to work harder to maintain lasting relationships, which for the customer are about more than just price and convenience.