WillowWorks LLC, a retail clothing store, has been sourcing its raw materials from a supplier named ThreadTym Corp. for the last five years. A change of management at ThreadTym resulted in an increase of the prices of the raw materials. As a result, WillowWorks purchases ThreadTym so that it can produce these products on its own. This scenario best illustrates ________.

Question

Quizplus · Accepted Answer

This scenario best illustrates backward integration, which occurs when a company acquires its suppliers to control its supply chain and lower costs. In this case, WillowWorks purchased ThreadTym to produce its own raw materials and control pricing.

WillowWorks LLC, a Retail Clothing Store, Has Been Sourcing Its