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How to Fight a Low-Priced Competitor

by on February 10, 2010

Different companies face different challenges. Before, international companies faced challenges worldwide; domestic companies faced challenges countrywide. But as the world is becoming flat, domestic companies now also face challenges worldwide. In the recession, some domestic companies are replaced by lower-priced foreign companies. So every company is trying to lower its cost as soon as possible and as much as possible. The company which has lower-priced products can own larger market share. If I am the CEO of the company, I will use a wide range of tactics to ward off any competitor. The followings are the methods I recommend the company to apply to fight the lower-priced competitor:

Stay in the business

1. Differentiation between the products and services.

2. Building another level of product line.

3. Creating a hassle-free shopping experience for customers.

4. Providing better after-sales services.

5. Reducing the prices of our products.

All of above methods can be mixed and matched. But as we did in response to our competitor’s price action, it will do the same in response to ours. To avoid this situation, it is important to keep updating our strategies.

Get out of the business

The worst method is quitting the business. Since we have already earned a lot in this business, it is time for us to quit this business and start a whole new business. We can start a new company based on our own experience, because it is not so easy to keep a company as a leading company for ten years. But as time goes by, some of our experience may be out of date. We should not set strategies only based on our own experience. We must execute a detailed technological and market analysis and must also consider the current market situation before setting up a new company.

-Brian Chen


From → Coursework

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