Small firms pursuing a cost leadership strategy have an advantage in reaching customers whose primary purchase criterion is high quality.

Question

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Small firms pursuing a cost leadership strategy typically focus on offering products or services at lower prices than competitors. Customers whose primary purchase criterion is high quality may not be as attracted to these lower-priced options and may instead prefer to pay more for a higher quality product from a competitor. Therefore, cost leadership may not be advantageous in reaching this specific group of customers.

Small Firms Pursuing a Cost Leadership Strategy Have an Advantage