Question

Which type of competitive strategy is characterized by convincing rivals not to enter a price war, protection from customer pressure to lower prices, and the ability to better withstand cost increases from suppliers?
a) cost leadership focus
b) overall low-cost leadership
c) differentiation
d) differentiation focus

Answer 1

Answer:

b) overall low-cost leadership

Explanation:

By Michael Porter, this is one of the generic strategies. This strategy implies that the company is dominating the market by securing a low-cost approach across all channels (supplier side, customers, rivals). This is generally achieved by low operating costs and by the factors listed out in the example itself (influencing rivals and suppliers). This type of strategy puts a company ahead of most of its competitors.