NAME:SYED ALI MUJTABA

REG NO:14777

Cost leadership:

Cost Leadership is the mechanism of establishing a competitive advantage by having the lowest
cost of operation in the industry. This strategy is especially beneficial in a market where the
price is an important factor.

The primary objective of a firm aiming to attain cost leadership is to become the lowest cost
producer in comparison to the competitors. This is usually achieved by large scale production
which enables the firm to attain economies of scale or by innovating the production process.

WALMART

Walmart's first characteristic is cost effectiveness. On the off chance that a value war were to
break out tomorrow, this retail monster could outlive every one of its rivals. It can, hence, keep
up the most reduced costs and pull in those clients who base their purchasing choice basically
on cost. Walmart conveys the most worth to their clients by offering absolute bottom costs.

IMITIAZ

Imitiaz retail store is cost effective. It entice the customer to visit the store due to low price of
goods.

DIFFERENTIATION:

Differentiation involves making your products or services different from and more attractive
than those of your competitors. How you do this depends on the exact nature of your industry
and of the products and services themselves, but will typically involve features, functionality,
durability, support, and also brand image that your customers value.

To make a success of a Differentiation strategy, organizations need:

Good research, development and innovation.

The ability to deliver high-quality products or services.

MERCEDES-BENZ

The commitment of Mercedes-Benz to forefront innovation, styling, and wellbeing

advancements has made the association's vehicles valued by the individuals who are
adequately rich to bear the cost of them.
UNILEVER PAKISTAN

The company we have chosen is “UNILEVER PAKISTAN LIMITED”. And we will discuss all the
features of product differentiation one by one by taking the personal care brands of unilever.

Personal care brands include:

1. Clear
2. Close up
3. Fair & lovely
4. Lifebuoy soap
5. Lifebuoy shampoo
6. Lux
7. Pond’s
8. rexona
9. Sunsilk

We chose this company because of the value given to the products of unilever. According to a
research “160 million times a day, someone somewhere chooses a Unilever product”.

The company says that:

“From feeding your family to keeping your home clean and fresh, our brands are part of
everyday life”

BOTH COST LEADERSHIP AND DIFFERENTIATION

1. SHAN FOODS

Shan foods has recently focused on becoming a “House of Brands” like Unilever and P&G. Shan
offers multiple and vast variety of products which led them to stand out in the market. Shan
Foods is the only spice company in Southeast Asia with Cryogenic Technology that preserves
the taste of 1600-1700 tons of spices when it is ground by maintaining freezing (0 °C)
temperature and killing heat produced from friction. Shan follow both cost leadership and
differentiation strategy by offering different variety of products with lower prices. Apart from
quality, SHAN FOODS focuses on giving variety, better packaging, brand reputation, easier
recipes and greater availability.

2. McDonald
McDonald’s follow both strategies as cost leadership and Differentiation. In Porter’s model, this
generic strategy involves minimizing costs to offer products at low prices. As a low-cost
provider, McDonald’s offers products that are relatively cheaper compared to competitors like
Arby’s. However, the company also uses broad differentiation as a secondary or supporting
generic strategy. This secondary generic strategy involves developing the business and its
products to make them distinct from competitors. For example, through MacAfee products,
McDonald’s applies the broad differentiation generic strategy.

Question: How above analysis might be useful in selecting the product or service in your

Selling assignment and selection of three ideas for new business development?

Answer: After reviewing the Porter’s Generic Strategies and factors influenced for deciding on
those

Strategies, it is very important to comprehend the market requirement and target market for
determining which approach to observe before starting the business. Considering the cutting-
edge circumstances around the world, when there is a pandemic condition exist which has badly
affected the universal economic condition, I would instead opt for to go with the Cost leadership
approach with competitive exceptional when opening new business. Because, this helps to
induce more than one and different clients and subsequently it affects the increase of business.

If you offer low value with aggressive fine product, you would seize huge purchaser which will
help to beautify business and robust your future expansion. You would have greater capital to
invest and can amplify the business.