Musings on business strategy from a business school professor in Singapore. Content will include a sporadic commentary on business related news, recent examples of old principles and frameworks, book reviews, and more general thoughts related to strategic management broadly conceived.
Saturday, 23 November 2013
Example of a low cost strategy in ecommerce
In my strategy class we have talked about there only being room for one successful low-cost strategy company in each industry. Boxed could be an example. They only sell around 600 necessities (e.g. diapers, toilet paper), but in larger packs compared to Amazon. The company claims that if customers buy in larger quantity, prices can be up to 20% lower than Amazon. To accomplish such low prices the company needs to be very cost focused. For instance: they only have an iphone/android application, no website, they only deliver to a few US states that are densely populated.
No comments:
Post a Comment