Different companies across different industries adopt any one of the five generic strategies to gain competitive advantage. Which of the following is most likely to use a low-cost provider strategy?
A) A fashion clothing line uses sought-after designers and natural fabrics.
B) A mortgage company specializes in lending money for second homes.
C) An online retailer delivers organic groceries overnight.
D) A baby products retailer sells unassembled baby furniture produced in China.
E) A dairy products manufacturer uses exotic substitutes to produce lactose-free dairy products.

Question

Quizplus · Accepted Answer

A low-cost provider strategy aims to offer products or services at a lower cost than competitors. Selling unassembled baby furniture produced in a low-cost country like China can help the company offer lower prices and compete on cost. Choices A, B, C, and E involve offering unique or desirable products, which would require a differentiation strategy, not a low-cost provider strategy.

Different Companies Across Different Industries Adopt Any One of the Five