The options for remedying a supplier-related cost disadvantage include
A) trying to negotiate more favorable prices with suppliers and switching to lower priced substitute inputs.
B) forward vertical integration.
C) shifting into the production of substitute products.
D) shifting from a low-cost leadership strategy to a differentiation or focus strategy.
E) cutting selling prices and trying to win a bigger market share.

Question

Quizplus · Accepted Answer

The best option for remedying a supplier-related cost disadvantage is to negotiate more favorable prices with suppliers and switch to lower priced substitute inputs. This helps in reducing the cost and maintaining competitiveness in the market. Forward vertical integration and shifting into the production of substitute products may not be feasible options in all cases. Shifting from low-cost leadership strategy to differentiation or focus strategy may not be a viable option if the company is well-established in the market. Cutting selling prices to win a bigger market share might not be sustainable as it could lead to a price war and hurt the profitability of the company.

The Options for Remedying a Supplier-Related Cost Disadvantage Include