Examples of Management Strategies for a Cake Bakery Business

Topics: Strategic management, Economics, Management Pages: 2 (433 words) Published: November 19, 2011
Examples of Management Strategies for a Cake Bakery Business Businesses use a variety of specific strategies to achieve their goals, but all business strategies can categorized as one of four generic management strategies. If you are operating a cake bakery, choose one of these four management strategies to give direction to your business. Your choice of strategy will depend on the goals you want to achieve and the type of cake bakery you want to operate. Cost Leadership

A cost leadership management strategy involves being the lowest cost provider of your products. For a cake bakery, this involves achieving economies of scale. To achieve economies of scale, you will need to produce a high volume of cakes. This will allow you to increase worker productivity through division of labor and save money by purchasing ingredients in larger quantities, giving you a greater ability to offer your products for a competitive price. Differentiation

Differentiation is a non-price strategy. Instead of gaining customers by offering them the lowest price, you will attract them with value-adding features. In a cake business you can do this by increasing the quality of your cakes; for instance, you may choose to only use premium ingredients or develop special recipes. You can also differentiate yourself through added services, such as customized cake orders or delivery or rush service options. Cost Focus

A cost focus strategy is similar to a cost leadership strategy, but it involves focusing on a narrow niche market. For example, you might offer cakes that fit a niche occasion, such as weddings or birthdays. Alternatively, you could cater to a niche consumer by using organic or vegan products. The cost focus strategy is designed to make your company the most cost-competitive within a niche. For example, if you operate a bakery that only prepares wedding cakes, you would aim to be the cheapest producer of wedding cakes, although your competitors might produce cheaper cakes of...
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