Question

Big Lots is able to compete against Wal-Mart with a cost leadership strategy because of its strengths in highly disciplined merchandise cost and inventory management system. This illustrates the:________.
A) ability of Big Lots to imitate Wal-Mart's tightly integrated activity map.
B) ability to survive against a dominant competitor by changing from a broad competitive scope to a narrow competitive scope.
C) fact that support activities in the firm can provide sources of cost reduction.
D) importance of effective use of primary activities in the value chain.

Answer 1

Answer:

A) ability of Big Lots to imitate Wal-Mart's tightly integrated activity map.

Explanation:

Competitive advantage of a company is it's ability to leverage on unique capabilities and resources to gain more market share than others.

In this instance Big Lots is competing favourably by imitating unique capability of Walmart which is highly disciplined merchandise cost and inventory management system.

A business can imitate another's strategy in order to better compete with them.

For example acquiring a company to increase scale of operations to match a competitor.

Answer 2

Answer:

B) ability to survive against a dominant competitor by changing from a broad competitive scope to a narrow competitive scope

Explanation:

Note that we were told that  Big Lot has strengths in inventory management systems; a somewhat narrow competitive scope since most businesses struggle with inventory management.

Also, being highly disciplined in its merchandise cost played a major factor in other to survive against a dominant competitor like Wal-Mart.