Can a cost leadership strategy be described as 'no frills’?
A.
Yes, it lowers the cost and increases the competitive scope
B.
Yes, it lowers the cost and differentiates the product
C.
No, as it increases the costs and differentiates the product
D.
No, as it increases the costs and narrows the market segment
The Answer Is:
A
This question includes an explanation.
Explanation:
Cost leadership strategy (Porter’s Generic Strategies) is often called a “no-frills” approach. The focus is on being the lowest-cost producer in the industry, allowing the organisation to serve a broad market with minimal differentiation. This approach reduces cost while widening competitive scope, enabling companies to compete on price advantage.
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