A manufacturing business pursuing cost leadership will likely
A) focus on a narrow market segment.
B) rely on experience effects to raise efficiency.
C) use advertising to build brand image.
D) put heavy emphasis on product engineering.

Question

Quizplus · Accepted Answer

A manufacturing business pursuing cost leadership seeks to minimize costs while maintaining a reasonable level of quality. One way to achieve this is by relying on experience effects, which means that the more a company produces of a particular product, the more efficient their production process becomes. This allows them to produce at a lower cost than competitors who do not have the same level of production experience. Focusing on a narrow market segment (A) may not necessarily lead to cost leadership, as it may limit the company's ability to achieve economies of scale. Advertising (C) and product engineering (D) may be relevant in different competitive strategies, but they do not directly contribute to cost leadership.

A Manufacturing Business Pursuing Cost Leadership Will Likely