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Greggs Competitive Strategy

782 Words4 Pages

Competitive strategy is a theory describing how a company pursues competitive advantage over other firms across their market scope. According to Porter’s Generic Strategies, a firm’s market scope will either be ‘Broad’ (Mass Market) or ‘Narrow’ (Niche market) and their competitive advantage will be either due to their ‘Cost’ advantage or because they are ‘Differentiated’. These descriptions create four main strategies a firm could be ‘Cost Leadership’, ‘Cost Focus’ ‘Differentiated Focus’ or ‘Differentiated Leadership’. Greggs, a well established high street bakery shop specialising in the production of sausage rolls, cakes, pastries and sandwiches, are known for their low selling price but relatively high quality (compared to other high street …show more content…

I feel it unnecessary for a large company like Greggs to adopt a new strategy whilst being a ‘Cost Leader’ is proving effective and profitable for them. Also, if they adopt a ‘Differentiated Focus’ and change their strategy completely, this may affect their brand image and reputation as they will need to spend more money into market research to establish a new target market and create new, differentiated products (product innovation) to reach the new wants and needs of the new target market. This differentiated focus may affect their profitability, as not only will they spend large amounts of money on market research, but also they may have to increase their selling price in order to cover the costs of the innovation and give them a differentiated product image to consumers. This may not only damage profitability and their margins, but potentially their brand reputation. Therefore, I feel Greggs adopting a ‘Differentiated Focus’ strategy within the next 5 years should not be an option for

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