Competing on cost primarily means achieving maximum value as perceived by the customer. In a highly competitive market, businesses often strive to offer products or services at the lowest possible price while maintaining acceptable quality. This approach appeals to price-sensitive customers who seek the best deal for their money.
To achieve this, companies must carefully manage their production processes, supply chains, and operational efficiencies to reduce costs without sacrificing value. It’s not just about being the cheapest option; it’s about delivering a product or service that customers feel provides good value for what they pay.