Trader Joe's biggest vulnerability in employing a best-cost provider strategy is
A)relying too heavily on outsourcing.
B)getting squeezed between the strategies of firms employing low-cost provider strategies and high-end differentiation strategies.
C)getting trapped in a price war with low-cost leaders.
D)being timid in cutting its prices far enough below high-end differentiators to win away many of their customers.
E)not having a sustainable distinctive competence in cost reduction.

Question

Quizplus · Accepted Answer

Trader Joe's best-cost provider strategy puts them in a vulnerable position as they may get squeezed between the low-cost leaders and high-end differentiators. The low-cost leaders can undercut their pricing while high-end differentiators offer better quality and customer experience. This makes it difficult for Trader Joe's to maintain their competitive advantage and attract customers.

Trader Joe's Biggest Vulnerability in Employing a Best-Cost Provider Strategy