Which of the following is NOT one of the pitfalls of a low-cost provider strategy?
A) Overly aggressive price-cutting
B) Setting the industry's price ceiling to capture volume gains and achieve economies of scale
C) Relying on an approach to reduce costs that can be easily copied
D) Becoming too fixated on cost reduction
E) Having the basis for the firm's cost advantage undermined by cost-saving technological breakthroughs that can be readily adopted by rival firms

Question

Quizplus · Accepted Answer

Setting the industry's price ceiling to capture volume gains and achieve economies of scale is actually a potential benefit of a low-cost provider strategy, as it allows the firm to capture a larger market share and reduce costs through higher production volumes. The other options listed are indeed pitfalls of a low-cost provider strategy.

Which of the Following Is NOT One of the Pitfalls