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The Racey Bicycle Company is headquartered and operates their manufacturing facility in San Bernardino, CA. They...

The Racey Bicycle Company is headquartered and operates their manufacturing facility in San Bernardino, CA. They currently compete in the customized bicycle market in California only. They specialize in manufacturing customized bicycles for handicapped children only. Racey has decided to begin expanding to the east coast and has started to select independent bicycle shops in New York to carry and distribute their product. (1) Which of the nine corporate growth strategies is Racey following as they expand? (2) Explain why you chose this strategy? (Week 1 lecture notes on Growth Strategies)

9 Growth strategies:

Market Penetration Strategy

Market Development Strategy

Product Development Strategy

Horizontal Diversification

Concentric Diversification

Conglomerate Diversification

Backward Integration

Forward Integration

Horizontal Integration

business   Operations-Management   
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Answer #1

The Racey Bicycle Company is headquartered and operates its manufacturing facility in San Bernardino, CA. They currently compete in the customized bicycle market in California only. They specialize in manufacturing customized bicycles for handicapped children only. Racey has decided to begin expanding to the east coast and has started to select independent bicycle shops in New York to carry and distribute their product.

Answer 1:- In the above case, the company is mainly focusing on the market development strategy.

Answer 2:- The reason for the answer to market development strategy is that this is a strategy which is adopted by the organizations when they look to create the new market segments to the existing products. As the company in the case, is looking to create a new market segment for the location of east coast thus they are looking to expand their market.

The market development strategy is used y following ways:-

Selling the current product to the new customers

Making existing customers to use the product in a new manner

Selling the current product in the new location

Modification of the current product     

Increasing sales with the existing product

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