Business Level Strategy

While corporate-level strategy is formulated for organization which carries different lines of business, business-level strategy is formulated for those organizations which carry a single line of business. Alternatively, it can be teamed as sub-strategy of corporate strategy where separate strategy is formulated for each line of business. Business level strategy is “formulated by business managers to oversee the interests ad actions of a particular business in such a way as to accomplish its long-term objectives.” It aims at strengthening a business into eh caging environment. For companies producing a single-line product, corporate and business level strategies are the same.

(a) Cost leadership strategy:

In this strategy, the firm increases market share by lowering the cost of its products, reducing the selling price and increasing the sales volume. High profits are earned by increasing sales in the present market by cutting the costs (production, research and development, advertising etc.)

(b) Differentiation strategy:

In this strategy, firm increases its market share but keeping the price of its products same or even more than those of its competitors. It changes its product featured like color, shape, design or size and creates appeal for it s products. Since product features are different from those of competitors, it creates brand loyalty amongst customers and without reducing the costs, the firm increases its sales volume and profits.

(c) Focus strategy:

In theist strategy, the firm increases its market share, sales volume and profits by focusing on a section rather than the entire market. The focus may be on a group of customers (males or females) a specific product (only one product rather that the whole product lime), a specific area (only northern region rather than the whole country). The aim is to sell more in a narrower market. This can be done through cost reduction (lower prices) product differentiation (customer appeal) or both.

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