BUS STRATEGY AND MANAGEMENT PRINCIPLES

Chapter 5 Questions:

1. Describe low-cost strategy. How does this relate to differentiation?
2. Aside from low-cost strategy, describe other methods that businesses can use to differentiate their products.
3. Describe how businesses approach segmenting the market, and why market segmentation could be an attractive business strategy. Why do businesses segment the market? What approaches can be used to segment the market? How can this lead to competitive advantage?

Chapter 6 Questions:

1. Define fragmented and consolidated industries. What are the differences between these two types of industries?
2. What opportunities and advantages do consolidated industries offer that fragmented industries do not?
3. Describe horizontal and vertical integration. Why do businesses leverage these vehicles for growth, and how can they aid in gaining competitive advantage?

Answer preview

Low-cost strategy is a strategy used in pricing where a business gives an incredibly low price to encourage demand for its goods or services and gain market share. This strategy is used by the company especially when the product has little competitive advantage. Differentiation strategy helps to promote the company’s brand in the market. Both approaches assist in gaining a significant market share from the competitors, the growing demand for products in the market and help in the increase of profit level of the business…

(650 words)