What does value chain refer to in business?

The value chain refers to the set of activities that a business engages in to deliver a product or service from conception to consumption. This concept, introduced by Michael Porter, emphasizes how various activities, such as design, production, marketing, and distribution, interconnect to create value for customers. Each step in the value chain adds to the overall value of the final product, ultimately influencing the company's competitive advantage in the market. By analyzing the value chain, businesses can identify areas for improvement, optimize processes, and enhance customer satisfaction.

In this context, the other options, while related to business operations, do not capture the comprehensive framework of the value chain. Acquiring new customers focuses specifically on marketing and sales efforts, pricing strategies are concerned with economic factors rather than operational flow, and the chain of suppliers is merely one part of the overall value chain, which includes much more than just the suppliers involved in production. Thus, option B accurately encapsulates the essence of what a value chain entails in a business setting.