Business Studies - Advantages & disadvantages of having a large product mix

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Business Studies - Advantages & disadvantages of having a large product mix

Advantages

  • To offer a wider range of goods and services to support the original product. The florist may offer a variety of pots and vases for the flower arrangements so that the customer spends more in any one visit.To offer a wider range of goods and services to support the original product. The florist may offer a variety of pots and vases for the flower arrangements so that the customer spends more in any one visit.
  • To attract new consumers by aiming at a different target market. An electrical store might start to sell computer games and game consoles to attract younger consumers who would not normally buy lights and plugs.
  • To diversify so that if sales of the original product decline, increasing sales of new products might replace it. A confectionery shop selling quality chocolates that have seasonal demand could start to offer homemade ice creams, both of which sell well at different times of the year.

Disadvantages

  • Many managers have to be employed to take decisions about the products.
  • Bad publicity for one product may harm the company's whole image.
  • The cost of developing and selling so many products is high.
  • Some products may fail if the company has not done sufficent market research.

Evaluation

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