Discuss with your class the key factors for future competitive success. List the
ID: 399359 • Letter: D
Question
Discuss with your class the key factors for future competitive success. List the common types of key success factors and answer the following questions: •On what basis do buyers of the industry’s product choose between the competing brands of sellers? What product attributes are crucial? •What resources and competitive capabilities does a company need to have to be competitively successful? •What shortcomings are almost certain to put a company at a significant competitive disadvantage? Include at least one APA-formatted citation from your textbook, Crafting & Executing Strategy, to support your rationale and receive full credit.
Explanation / Answer
An industry's key success factors, also known as KSFs are the areas that have to be taken care of or given attention by the industry. They affect the prosperity of the industry in the marketplace. They can be the product attributes, the resources of the industry, the competitive advantage over others, and finally the outcome of the business which will prove whether the industry is at profit or loss.
Thus, it is evident that KFC's are very important for any business enterprise. They determine the survival of the industry. They refer to the rules or the strategies of the industry.
The buyers buy the product on the following basis as against the competing brands/ crucial attributes.
1. Satisfies the want or the need of the buyer,
2. It should have a good perceived value and good quality,
3. Is appealing to the eyes, a good niche market,
4. Capable of being repurchased by the buyer. It should be capable of being replenished and available.
5. Can be upsold and cross sold
6. Back-end product which is related should be available. This is a secret of the seller to make profits.
An unit elasticity should be achieved. An unit elasticity is where the sales are the same inspite of increase or decrease in the prices.
Next is with regard to the market. This will include points like the market for the product, the kind of product, size of the market, etc. These factors have to be pre-determined by the seller before entering the market. An ample margin is important.
Generally, the profit margin of a product must be minimum 2:1. The more higher, the better.
The perceived value is another important factor. It should be high. It reflects through the quality, the success testimonials, convenience, improved design which will include packaging and labelling of the product, mentioning the specifications that are better than other competitor's products, and development of unique proposition for sales.
The value for upselling and cross-selling is given by a good marketer. This is done by increasing the amount spent by the buyer on each purchase. Upselling focus on encouraging the buyer by giving incentives. This makes the customer purchase more.
Cross-selling is selling a related product to the customer which they did not intend to buy.
The preceding analysis is used to decide the future prospects of the company. For this, the factors such as the growth potential of the industry, the competition affecting around, the profit margin, the market size acquired, etc. This is done to avoid the shortcomings and take the available opportunity to maintain its margin.