Backward integration is a type of vertical integration in which a company expands its role to fulfill tasks formerly completed by businesses up the supply chain. It is a process in which a company acquires or merges with other businesses that supply raw materials needed in the production of its finished product. Companies pursue backward integration when it is expected to result in improved efficiency and cost savings. Backward integration allows a company to gain greater control over the earlier stages of the value chain, which encompass the functions performed by specialized manufacturers and suppliers. The benefits of backward integration include cost savings, increased revenues, and improved efficiency in the production process. Companies also use backward integration as a way of gaining competitive advantage and creating barriers to entry to new industry entrants. Backward integration can be capital intensive, meaning it often requires large sums of money to purchase part of the supply chain.