Chapter 2 - Definitions Flashcards
A request from a buying organisation to invite suppliers to formally quote on a large scale project.
Tendering process
A strategy used by businesses in order to gain competitive advantage by having the lowest cost of operation within their particular industry.
Cost leadership
When a product or brand stands out as being unique to customers when compared to its competitors.
Differentiation
Competition between companies, usually within the same industry.
Rivalry
The network used to get a product or service from the manufacturer or creator to the end user or consumer. It can include wholesalers, agents and retailers and can include online channels.
Distribution channels
When a product is sold for a higher price than its competitors.
Premium price
The relative ability of one party to exert influence over another in a negotiation or commercial dealing.
Bargaining power
Strategic tool to help managers recognise the weaknesses of their organisation and form strategies to guard against disruption of suppliers.
Kraljic matrix
The manner in which customers purchase goods or services.
Order patterns
A marketplace involving individual consumers rather than businesses or companies.
Consumer markets
When products are sold directly to consumers rather than through retailers.
Direct marketing
Goods which, as a result of changed conditions, may replace each other in the market.
Substitutes
Obstacles that prevent a business from leaving an industry.
Exit barriers
People who like to be the first to try new ideas, goods and services.
Innovators
A group of consumers who are the first after the innovators to buy or use a new product or technology.
Early adopters
A group of consumers who buy or use a new product or technology after seeing it used successfully by innovators and early adopters.
Middle majority
The last group of consumers who buy or use a new product or technology.
Laggards
Reports released once a year as a way of communicating with shareholders about the performance of a company.
Company annual reports
Where a companies revenue is equal to its costs.
Break even point
A comprehensive list of components, items, materials and parts to create a product, essentially a recipe for the production of an item.
Bill of materials
Porters 5 Forces
Threat of New Entrants
Bargaining power of buyers
Threat of substitutes
Bargaining power of suppliers
Rivalry among existing competitors.
Segments based on Buyers:
Buyers strategy
Buyers Size
Ownership
Financial strength
Order patterns
Product or Service based segments:
Price levels
Features
Design
Packaging
Performance
New vs Replacement
Segments based on distribution channels:
Direct sale vs distributors
Direct marketing vs retail
Exclusive vs non-exclusive outlets
Segments based on geography:
Localities, regions or countries
Route details
Climate zones
Country groupings
