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CIPS L6M9 Exam - Topic 3 Question 19 Discussion

Actual exam question for CIPS's L6M9 exam
Question #: 19
Topic #: 3
[All L6M9 Questions]

A jewelry manufacturer has recently acquired the mining company that supplies the precious metals used in its jewelry production.

What is this an example of?

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Suggested Answer: D

Backward vertical integration occurs when a company acquires a supplier or producer that is further upstream in the supply chain. In contrast, forward vertical integration happens when a company buys a retailer or distributor further downstream.

Note: Forward horizontal and backward horizontal integration do not exist---these are trick options. (See LO 1.2, p.42)


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