When a company is analyzing an industry, which factor would lead the company to believe the threat of substitutes is low?
A) if economies of scale and switching costs are high
B) there are many alternative products and services available
C) products and services will not serve the same function as well as existing products and services
D) the price-value trade-off for the alternative is very good

Question

Quizplus · Accepted Answer

If alternative products and services do not serve the same function as well as existing products and services, the threat of substitutes is considered low because consumers are less likely to switch to these alternatives.

When a Company Is Analyzing an Industry, Which Factor Would