Abila's family, which recently moved to the United States from Lebanon, is highly skilled in working with leather goods. They had a small manufacturing and distribution company back home, and they have decided to start a new company in the midwestern city where they now live. Abila's organizational and leadership abilities have made her a natural choice to run the venture, Levantine Leather Goods, and at first business is good. Levantine soon develops a reputation for personalized service, and customers know that special orders are never a problem. However, Abila and her company soon face stiff competition from Allied Equipment Supply, a nationwide retail chain that sells leather goods, among other items, as prices significantly lower than those charged by Levantine. In order to

Question

effectively compete, Abila's company should

A) go head-to-head with Allied Equipment Supply on the national level.
B) focus on providing quality goods in a timely fashion to niche markets.
C) stop providing customized service, which is costly and time-consuming.
D) adopt a low-price, high-volume strategy to retain its customer base.
E) dramatically increase its workforce in order to expand production.

Answer 1

B) focus on providing quality goods in a timely fashion to niche markets.
Explanation: Nimble, small firms frequently outmaneuver big bureaucracies. Smaller companies can move fast, provide quality goods and services to targeted market niches, and inspire greater involvement from their people. They introduce new and better products, and they steal market share. The premium now is on flexibility and responsiveness—the unique potential strengths of the small firm.