A business-level strategy in which a company exploits economies of scale is called a ________.
A) differentiation strategy
B) stability strategy
C) low-cost leadership strategy
D) retrenchment strategy

Question

Quizplus · Accepted Answer

A low-cost leadership strategy is focused on achieving the lowest possible cost of production or service delivery in order to offer prices that are competitive or lower than the market average. This is often achieved by exploiting economies of scale, in which a company can enjoy lower costs due to its larger size and production volume, spreading fixed costs over more units, negotiating better deals with suppliers, and so on. Therefore, this is the best answer out of the given options. A differentiation strategy, on the other hand, seeks to offer unique and valuable features that differentiate a company's products or services from those of its rivals, often at a premium price. A stability strategy is focused on maintaining the status quo and avoiding major changes or risks. A retrenchment strategy involves cutting back or restructuring a company's operations due to declining performance or strategic redirection.

A Business-Level Strategy in Which a Company Exploits Economies of Scale