Cost Competitiveness
Competing through lower costs than competitors.
Formula
Cost Competitiveness = Lower unit costs than rival firms
Real World
Primark sources garments from Bangladesh, where labour costs are significantly lower than in Western Europe, allowing it to undercut rivals on price while maintaining reasonable margins.
Exam Focus
When evaluating cost competitiveness, always weigh short-term savings against long-term risks such as reputational damage or quality decline.
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