Certified Supply Chain Professional (CSCP) Practice Exam

What is one reason to form a strategic alliance?

1. To sell off parts of the business

2. To increase market access

3. To reduce operational costs

4. To solely rely on third-party suppliers

The correct answer is: To increase market access

Forming a strategic alliance is often pursued to increase market access, which plays a crucial role in enhancing the competitive edge of the partners involved. When companies collaborate strategically, they can leverage each other's strengths, market presence, and customer bases. This combination can lead to shared resources and capabilities that enable faster entry into new markets or segments, enhancing both partners' visibility and reach without necessarily incurring the full costs or risks associated with entering new markets independently. By increasing market access through a strategic alliance, companies can tap into new geographical regions or customer demographics, benefiting from localized knowledge and established distribution channels that the partner may already have. This collaboration often allows for greater efficiency and effectiveness in marketing efforts and improves overall business growth potential. In contrast, the other options do not align with the primary objectives of forming strategic alliances, which focus on mutual benefits and collaborative growth rather than liquidation, operational cost-cutting in a solo context, or establishing dependence on third-party suppliers. Such factors do not contribute directly to the overarching goal of market expansion and shared success in a strategic partnership.