question archive Quick Eats is a fast-food restaurant that has recently entered the hospitality industry
Quick Eats is a fast-food restaurant that has recently entered the hospitality industry
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Quick Eats is a fast-food restaurant that has recently entered the hospitality industry. Since most of its competitors are pursuing a low-cost position and doing well, Quick Eats also wants to adopt the same strategy. Which of the following will be a likely implication of this decision?
Multiple Choice
- Quick Eats will be better placed to gain a competitive advantage in the industry.
- Quick Eats will face low profit potential.
- Quick Eats will not face any direct competition in the industry.
- Quick Eats will be able to create higher value for its customers.
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Quick Eats will face low profit potential.
Step-by-step explanation
The implications of low cost strategy is low profits despite the fact that the strategy increases the sales, the sales are not large enough to recoup the forgone profits hence Quick Eats will face low profit potential.
