Question

A competitive strategy to be the low-cost provider in an industry typically does not work well when:_______

a) emergent strategies are required to respond to changes in competitor power.
b) industry newcomers use low introductory prices to attract buyers and build a customer base.
c) price competition among rival sellers is especially vigorous.
d) commodity-based product prevails and minimal differentiation exists.
e) buyers incur low costs in switching their purchases from one seller or brand to another.

Answer 1

a) emergent strategies are required to respond to changes in competitor power.

Step-by-step explanation:

Competitive strategy is the strategy used gain competitive advantage and outperform competitor in the market. Low cost provider is one of the strategy of competitive strategy that outperform competitor by selling goods at very low cost and competitors are not able to sustain in the market or start making loss, this also help gain maximum market share as buyer switch their purchases from one seller or brand to another. This strategy does not work as sometime emergent strategies are required to respond to changes in competitor power. Competitor sometime change their strategy to high quality product, bundling the products, etc, in this case emergent strategies are required.

Answer 2

The Correct answer is A

Step-by-step explanation:

Strategy of low cost is the kind of the pricing strategy, in which the business or organization, offers or provide the products or services at low price. This strategy helps in stimulating the demand as well as gain or acquire the higher market share.

So, the strategy which is competitive and also the low cost provider in the industry work well when:

1. Newcomers in the industry uses at the introductory stage, the low prices so that could attract the buyers.

2. The competition on the price between the rivals sellers is vigorous.

3. The buyer also incur the low costs while switching the purchases from seller to another seller.

4. The product which are commodity grounded prevail as well as has minimal differentiation.