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Which of the following best illustrates forward vertical integration?

A) A manufacturer acquires its supplier
B) A retailer opens new stores
C) A company diversifies its product line
D) A business forms an alliance with a competitor

User Wislon
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1 Answer

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Final answer:

Forward vertical integration is best illustrated by a manufacturer acquiring its supplier, as this helps in streamlining the production process and controlling the supply of raw materials.

Step-by-step explanation:

The concept in question is forward vertical integration, which refers to a growth strategy where a company acquires other companies that operate at a later stage in the production process. For instance, a manufacturer purchasing a retail store that sells its products.

The correct answer to the question, which of the following best illustrates forward vertical integration, is A) A manufacturer acquires its supplier. This move allows the manufacturer to control both the production and supply of its raw materials, streamlining the production process and possibly leading to increased efficiencies and cost savings.

Other options, like opening new stores or diversifying product lines, are different types of business strategies and do not fit the definition of forward vertical integration.

User Timidger
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