BlockWood Inc. has been providing raw materials to Couches Corp., a furniture company. The management at Couches recently decided to cut the prices it pays for the raw materials. BlockWood Inc. tried to negotiate a price that would be feasible for both companies, but Couches did not agree to pay more than what they had quoted. As BlockWood Inc. was facing similar difficulties with other buyers too, it eventually stopped supplying raw materials and took to manufacturing furniture instead. This scenario best illustrates ________.

Forward integration is a type of business strategy in which the business activities should be carried forward for incorporating the complete production of the product i.e. from the raw material to the end manufacturing of the product along with the supply chain and its logistics. In this, the supplier of the raw material should extend the business to the end manufacturing of the product

So as per the given situation, it is a forward integration

Bratislavago Bratislavago · Answer 2

The company named Block Wood Inc. is providing raw materials for Couches Corp. The management has found about the price cuts it pays for raw material. Both the companies are trying to negotiate the prices and are facing difficulties with the buyers.

They need a business strategy such as forward integration that involves a downstream vertical integration.

Where the company owns and controls the business. They are always head of the value chain in the industry. They can directly distribute or supply the products.

Hence the option D is correct.

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