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A furniture manufacturer makes basic decorative pieces such as tables, bookcases, and TV stands. This company uses a cost leadership strategy. To implement this strategy,
A furniture manufacturer makes basic decorative pieces such as tables, bookcases, and TV stands. This company uses a cost leadership strategy. To implement this strategy, some key activities in the value chain are:
using acceptable quality but basic input materials to construct the furniture
in the design and construction of the products, each one uses basic, standard pieces that are efficiently packaged so that customers can easily get them home from a store and complete easy doityourself assembly, meaning that the products can be distributed through multiple retailers and no home delivery and setup service is necessary
costs can be kept low by providing service after the sale through videos available online to describe assembly of the furniture and how to solve common assembly problems. By having these videos, the company reduces the calls that it receives from customers that need to be handled by employees.
Which of the following statements about this company's strategy and its value chain activities are accurate? Multiple answers are correct select all that apply.
a The approaches to the activities as described are more useful for a differentiation strategy than a cost leadership strategy.
b This company is taking an effective approach by aligning its activities to its strategy because a company gains competitive advantage by performing strategically important activities more cheaply or better than its competitors.
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