Ronald's has been in the fast-food business for five years.After struggling for two years,it finally broke even,and the french fries it offers are its most popular product.However,during the past year,its business has suffered because the farm that used to supply it with potatoes has increased its prices drastically.What should Ronald's do to control production costs?
A)Buy out the farm and become its own supplier.
B)Open more distribution outlets.
C)Broaden the product range by introducing potato nuggets on its menu.
D)Hire more efficient outlet managers.

Question

Quizplus · Accepted Answer

Buying out the farm could allow Ronald's to control its supply chain more effectively, potentially reducing the cost of potatoes, which are crucial for its most popular product, french fries. This vertical integration strategy could help in controlling production costs.

Ronald's Has Been in the Fast-Food Business for Five Years