Question

The managers at Sears Holdings Corporation have thought more about the options for international expansion and have made the decision not to proceed at this time. Instead, they will pursue a plan dedicated to making changes in the North American market only. The management team decided that over the course of the next two years, they want to engage in a vertical acquisition.

Below, describe how the firm may engage in a vertical acquisition. Include a practical example of how this can be accomplished, and state whether or not it is a feasible strategy to pursue.

Next, describe how the firm may engage in a horizontal acquisition. Include a practical example of how this can be accomplished, and state whether or not it is a feasible strategy to pursue.

Answer 1

Company Name: Sears Holdings Corporation Industry: Retail
Vertical acquisition		Horizontal acquisition
Description: Acquiring companies along the supply chain		Description: Acquiring a similar company in the same industry
Example	Feasibility	Example	Feasibility
Increasing product line	Introducing customer demanding products to the product line will increase sales and help in attaining more profit to the company. [Highly Feasible]	Increasing the no. of stores in crowded place.	Increasing the stores in populated place will promote brand image and assist in increasing the sales to significant extent. [Highly Feasibility]
After sales service center within store	Bringing in brand companies product sales and service section within the store would create convenience to the customer to buy products and get services in one place. [Feasible]	Expanding to populated countries using Franchise approach	Expanding to populated counties help the company to attain status of global brand as well as significant population helps in sales and profit attainment. [Feasible]
Acquisition of companies producing customer demanding products.	From the sales report, one can identify the products that are highly demanded. Knowing such products and companies producing it also acquisition of that company would generate additional profit and brand image. [Somewhat feasible]	Acquisition of with small retailers in North America	Acquiring small retails increases the no. of outlets. [Highly Feasible]