Strategy of cost leadership

Type :

Presentation

Pages :

8 pages

Format :

.doc

Published date :

01/20/2009

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Summary :

 
 

Table of Contents Strategy of cost leadership Table of Contents

 
  1. Introduction.
  2. Strategy of cost leadership.
    1. Hard discount.
    2. Distributers brands.
  3. Cost leadership is not enough any more.
    1. Hard discount takes another function.
    2. Reconsideration of Hard discount.
  4. Conclusion.
  5. Bibliography.

Abstract

In a market where competition is at it's peak, companies perpetually seek to win over new customers, new markets and to generate strong profits. They have thus banked on a new strategy to be more competitive: cost leadership. The strategy of cost leadership aims at directing the objectives of the company towards the minimization of it's total costs. The company is thus driven to find a sustainable reduction in unit costs in order to offer prices lower than those of competitors in the same sector. All the methods of distribution introduced this strategy, more precisely the hard discount which drew on this to evolve. Subsequently the distributor's brands were born, and then the big supermarket chains like Carrefour and Auchan began to enter the hard-discount market themselves, setting up their own (hard-discount) stores. Initially we will study the setting up of the strategy of domination by cost, hard discount, then distributor's brands, using the examples of Lidl and Leader Price. Next, we will see that this strategy is not enough to develop, that the lowering of costs is not the only factor to attract customers and finally that we can call into question the system of the hard discount.

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