helen mba _2 - Nelson Mandela Metropolitan University

options available to organisations.Figure 2.6 : The strategy clock : Competitive strategy optionsSource : Johnson & Scholes (2002 : 320)2.7.1.1 Price based strategies – routes one and twoFigure 2.6 shows that route one is a ‘no frills’ strategy which combines low price, lowperceived added value, and a focus on a price-sensitive market segment. Accordingto Johnson and Scholes (2002:319-322), route one seems unattractive, but there aresuccessful organisations applying it. There may well exist a segment of the marketwhich, while recognising that the quality of the product or service might be low, cannotafford to, or chooses not to, buy higher quality goods. Businesses seek to achievemarket entry through route one, and use it as a bridgehead to build volume beforemoving to other strategies. Johnson and Scholes write that the most profitable retailerin the UK, Matalan, follows a ‘no frills’ strategy.The merchandise range is limited, with few speciality products and very low prices.68