What is an example of a cost leadership strategy?


Quick Answer

An example of a cost leadership strategy is Wal-Mart Stores’ marketing strategy of “everyday low prices,” states Chron. As of 2015, Wal-Mart has been successful at using this strategy.

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Full Answer

A cost leadership strategy is marketing a company as the cheapest source for a service or good. In implementing this strategy, a company must minimize costs and pass the savings on to the customer.

Wal-Mart fulfills its “everyday low prices” strategy by offering products more inexpensively and consistently than its competitors. It can do this because of its large scale and efficient supply chain.

Another successful example is McDonald’s. This restaurant offers fast food at low prices through a division of labor of many minimally skilled employees and few higher-paid managers.

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