Exhibit 1 shows how the multi-layered structure of China’s IFAP supply network plays a key role. This structure gives China’s IFAP the ability to lower costs. It also exposes hidden risks in supply chain management, thereby establishing a winning technique. Multi-tier supply chains have become a key strategic driver in reducing capital assets as well as bringing products to market more efficiently than the current competitive strategy model. Multi-level structures are a great way to maintain quality standards while enhancing output based on clients’ preferences and needs. China’s IFAP must emphasize creating downstream demand for a range of goods to maintain its competitiveness. This will require the participation of both internal and external suppliers. Management of visibility at multiple levels is cheaper, especially when upstream suppliers change their supply chains. For multi-level structuring, leverage can be a key factor. This allows firms to generate revenue and helps consumers find what they need at the right time. Technological advancements have led to firms exploring multilevel structures. This is because they want financial freedom. This will reduce market volatility and increase customer happiness. That is the ultimate goal of all companies and suppliers. Zhangzidao cannot serve as China’s central company in the IFAP supply chain to adopt vertical integration. While the corporation managed to balance the huge upstream supply with the low-volume downstream customer demand but was not able maintain its competitiveness, external suppliers are still a threat to the company’s ability to compete. Modern technology and better management methods seem to have facilitated vertical integration. However, there are still problems with cooperation methods that can be used to link up large entities such as China’s merchants. Zhangzidao faces intense competition both from domestic and foreign firms that want to market aquatic products. The ability of foreign merchants to manage the supply chain is another key factor that makes Zhangzidao a leading business. This refers to international logistics of capital, goods and data. International dealers are more powerful in negotiating over the downstream and upstream linkages. For vertical integration, Zhangzidao may have more experience than Zhangzidao. Because Zhangzidao could manage and control conflicts between large upstream supply and small downstream demand, it was a key link in the IFAP supply chains. This is a critical factor when selecting the right business to execute vertical integration. This firm was a leader in technology and had a supportive management. A local enterprise was second in importance. The company was driven by Zhangzidao’s infrastructure, as well as its historical management of cold chain storage and logistics. International merchants were open to vertical integration. Because of Zhangzidao’s possible supply chain integration methods foreign merchants were more powerful than Zhangzidao. Because of their negotiating power, and the ready market for services they offer, international merchants and manufacturers who deal with aquatic products are keen to implement vertical integration.
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