Stump's Hot Olives are manufactured by a family business in Wisconsin and are sold in Midwestern grocery stores, through mail order, and to a few local restaurants. The company has been in operation since 1998 and relies on labor from family and friends to produce and package olives in attractive, reusable glass containers. They use store demonstrations to introduce their spicy olives to new customers. Discuss how this company can establish or maintain at least one of the three types of competitive advantage.
What will be an ideal response?
Student answers to this question will vary, but they should discuss one of the three types of competitive advantage: cost, product/service differentiation, and niche strategies. Their answers could include a cost competitive advantage, which can be achieved through no-frills goods and customer service, efficient labor, production innovations (such as new products not currently on the market), and the experience curve. A product differentiation competitive advantage might be achieved by the use of the value impression (this possibility is implied in the description of the containers). The company might also try selling an augmented product-offering by bundling pickles and pepper products with its olives. The niche competitive advantage may be appropriate for this company. Some students may suggest targeting gourmets or some other single market.
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