recommendations for action which address the issues raised in 3)
a list of references (at least 6 appropriate sources)
a reflection section
a final version of your report plan
Requirements: 2000 WORDS |
2000 word (+/- 10%) report made up of:
1500-word (+/- 10%) business report
250-word (+/- 10%) reflection
250-word (+/- 10%) plan
FOLLOW THE DOCUMENT ATTACHED CAREFULLY TO UNDERSTAND EACH PART OF THIS PAPER.
Answer preview
One of the recommendations is that IKEA should adopt a differentiation strategy other than the current cost leadership strategy. IKEA relies heavily on a cost leadership strategy where it always has a competitive advantage in the industry by having a lower cost of operation and production of its products. This explains why most of IKEA’s products are cheaper as compared to other products from the competitors. However, this strategy is prone to many side effects to the company. Some of the risk factors of adopting the cost leadership strategy include reduced employees performance, loss of segmented markets, reduced profitability, poor marketing, and lack of adequate innovation. According to Islami et al. et al. (2020), adopting a differentiation strategy offers a company a wide range of benefits. One of the benefits that IKEA will experience is higher consumer brand loyalty because customers will not have any perceived substitutes. Secondly, the company will record higher or better profit margins because customers will be more than willing to pay higher for the unique products offered by the company. An increasing number of customers will also enable the company to record more profits as a result
