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Lesson 5 Forum

Lesson 5 Forum

Q • This discussion is concerned with identifying and describing firms that follow low-cost provider strategies vs. broad differentiation strategy. • Question 1: a) Identify a company that pursues a low-cost provider strategy. b) Describe at least two cost drivers that are kept low for your selected company (i.e., well managed cost drivers that give a cost advantage to the low-cost provider; cf. p. 123-125 of your text). • Question 2: a) Identify a company that pursues a broad differentiation strategy. b) Describe at least two uniqueness drivers for your selected company (also called value drivers; cf. p. 130-132 of your text) • To get the maximum points for this discussion, you must make (A) make an initial post to answer the questions above and (B) reply to at least one other post.

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Walmart Inc. is an organization which pursues a low-cost provider strategy. Two cost drivers for Walmart to keep the prices low are availability of cheap raw materials and already acquired brand-identity or brand-awareness by customers. Starbucks is an organization which shows that its products and services are catered to the implementation of a broad differentiation strategy. Two uniqueness drivers for Starbucks are customized preferences of different nationalities of customers and acquisition of high quality raw materials to provide healthy and tasty coffee products.