A furniture manufacturer wants to expand its business using a vertical integration strategy - HSC - SSCE Business Studies - Question 18 - 2010 - Paper 1

To determine which business the furniture manufacturer should acquire for vertical integration, it's essential to choose a company that directly relates to its core operations.

Analysis of Options:

• (A) A timber plantation: This is a related business that supplies raw materials needed for furniture production—wood. Acquiring a timber plantation would allow the manufacturer to secure its supply chain and reduce costs associated with raw material procurement.

• (B) A travel agency: This option is unrelated to furniture manufacturing, and acquiring a travel agency would not benefit the business's core operations.

• (C) A brick manufacturing plant: While it may have some relevance if the furniture includes brick elements, it is generally not essential for a furniture manufacturer.

• (D) A competitor's furniture production facility: Acquiring a competitor could allow for an increase in market share, but it does not provide the stability and cost control offered by securing raw materials.

Conclusion: The best choice for vertical integration in this context would be to purchase (A) A timber plantation, as it feeds directly into the production process of furniture.