ABC Bank utilizes the janitorial services of Bob's Scrub-A-Dub-Dub to keep their buildings clean.Bob's provides all the necessary cleaning supplies,training of crews,background security checks (since the crews work after hours)and all other associated expenses.The other available janitorial services do not typically provide security checks and a client such as a bank would have to hire guards to watch the work of the janitors.This expense effectively limits the bank to utilizing only Bob's services.This illustrates the concept of

Question

Quizplus · Accepted Answer

The situation described in the scenario demonstrates high switching costs. The bank is limited to using Bob's Scrub-A-Dub-Dub because the cost of hiring additional security for other janitorial services would make it too expensive to switch providers.

ABC Bank Utilizes the Janitorial Services of Bob's Scrub-A-Dub-Dub to Keep