Final answer:
Firms use complementary strategic alliances for joint product development and distribution, combining their strengths to achieve shared objectives and enhance market presence without breaching antitrust laws.
Step-by-step explanation:
Firms often use complementary strategic alliances to take advantage of joint long-term product development and distribution opportunities. These alliances can combine the resources, capabilities, and core competencies of two or more companies to achieve objectives that would be difficult for each firm to accomplish alone. By collaborating in areas such as R&D, supply chain management, marketing, and other functional areas, companies aim to create synergies that result in a competitive advantage in the market.
In terms of competition, antitrust authorities block firms from colluding to create cartels that reduce output and raise prices. However, through strategic alliances, companies can legally collaborate to enhance their market offerings without breaching antitrust laws. Complementary alliances pave the way for innovation, efficiency, and broadening consumer choice, thereby balancing the need for competition with the benefits of cooperation.