Ch. 5 - Business Level Strategy Flashcards Preview

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Flashcards in Ch. 5 - Business Level Strategy Deck (12):

three questions to ask when developig busness level strategy

who do we serve, what do we provide, how do we provide it


ifferent generic strategic approach firm foloows

low cost, differentiation, fcus strategy or combos of these


poerter's five forces model intent

prvide comprenshvie freamework to asses an industrys long run profit potential


five forces are

threat of new entrants, bargaining power of customers, threat of substitutes, bargaining power of suppliers, rivarlry of existing competiton


threat of new entrants

some industries are easier to enter,,there acan be barriers of entry such as supply side economics, demand side benefits of scale, customer switching costs, capital requirements, incumbency adv, unequal access to distant channesl, restrictive gov policy


supply side economics of scale

arises when firms manufacture procuts/service in high volumes


demand side benefits of scale

any buyers willingness to pay for product increase as number of other buyer for product increases


customer swiwtiching costs

fixed costs buyers encounter if they change supplier of particular products service


capital requireents

large amt of capital needed


incumbency adv indep of size

maintain cost/quality adv that arent easily availbale to potential rivals


unequal access to distant channels

whoelsales retaialers where ultimate customer purchases p/s but ther are limited distant channels


restrictive gov policy

can ailmit foreclose entrey to industries via controls- patent protection, foregn investment arriers, limits on acces to locla raw materials markets