Suitable Strategies for Koleda PureRent Inc.

Running Head: KOLEDA PURERENT INC. 1
Suitable Strategies for Koleda PureRent Inc.
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KOLEDA PURERENT INC. 2
Question 1: What different strategies are available to this firm?
The various strategies that Koleda PureRent, Inc can apply include; Cost leadership
which involves reducing the cost of operation without compromising on the quality of the
product or service. It can do this through automating its operations in order to minimize the
number and cost of staff required in each store. This will enable them to offer their products at
lesser prices or rates (Blackburn, Hart, & Wainwright, 2013). Secondly, it can segment its
market into several clusters based on age and geographical location dimensions, so that it can
customize its products to suit a particular market group (Aaker & McLoughlin, 2010). For
example, young people living in towns require cheap furniture and electronics while middle-aged
people require more luxuries commodities. Thirdly, the company can adopt backward and
forward integration through good customer relationship management such as loyalty bonuses and
suppliers’ relationship management through timely payments (Scarborough, 2016). Also,
backward and forward integration can be enhanced through the use of supply chain management
systems that will notify suppliers when orders are needed by customers.
Question 2: What are the problems and benefits associated with each
strategy?
The problems associated with cost leadership strategy include; the
company will have to undergo a business process re-engineering which may
be time-consuming, secondly the strategy is likely to phase resistance from
staff since automation will lead to loss of jobs (Blackburn, Hart, & Wainwright,
2013). The benefits of cost leadership include; the company will be price
competitive than its competitors thus scaring away competitors, secondly, it