What is the primary purpose of vertical integration in business?

The primary purpose of vertical integration in business is to ensure control over the supply chain. This strategy involves a company taking over different stages of production or service delivery within the same industry, allowing it to streamline operations and reduce costs associated with external suppliers. By controlling more aspects of its supply chain, a business can improve its efficiency, secure supply channels, and increase its bargaining power, leading to enhanced competitiveness in the market. Vertical integration can help businesses reduce dependency on suppliers and manage quality more effectively, ultimately contributing to better financial outcomes.

In contrast to the chosen answer, merging businesses from different sectors of the industry refers to horizontal integration, which focuses on expanding market share across similar product lines rather than controlling supply chain processes. The other options likewise do not accurately capture the essence of vertical integration, as they pertain to different strategies or objectives, such as diversification or broader expansion across similar sectors.