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As a Management Consultant, Don Simon Suppliers Ltd presented their problems to you as follows:
a) the industry product is essentially standardized, commodity-type items ready available from variety of sellers
b) price competition among rival firms is a dominant force
c) buyers incur low switching cost in changing from one seller to another and
d)) there are few ways to achieve product differentials
Required:
1) What Competitive strategy do you recommed for Don Simon Suppliers Ltd.
2) What are the benefits associated with your recommended strategy.
3) What are the possible risks inherited with such a strategy.
Assuming you knew your required rate of return, how would you calculate a value for this stock?
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