Low Cost Competitors Part 3

Another case in point is the ball-point and fountain pen competition. Ball-point pens were much cheaper, easier and less messy to use. The fountain pens were beaten face down and lost almost all the market share to ball-point pens. Then somebody thought of making the fountain pen a luxury item. The fountain pen was sold for US$ 400 and positioned as a prestigious and luxurious item, similar to the jewel wear. The manufacturers of fountain pens such as Parker, Sheaffer and Mont Blanc have then comfortably locked into the high-end segment which the ball-point pens cannot penetrate.

Today, both the fountain and ball-point pens co-exist each has its own market niches. You need to be wary and be prepared to thwart off the moves of these low cost competitors. This is why Howard H Stevenson in his book said: “Do lunch or Be Lunch.”

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Dr Mike Teng (DBA, MBA, BEng, FIMechE, FIEE, CEng, PEng, FCMI, FCIM, SMCS) is the author of the best-selling business book “Corporate Turnaround: Nursing a sick company back to health”, in 2002. In 2006, he authored another book entitled, “Corporate Wellness: 101 Principles in Turnaround and Transformation.” Dr Teng is widely recognized as a turnaround CEO in Asia by the news media. He has 27 years of experience in corporate responsibilities in the Asia Pacific region. Of these, he held Chief Executive Officer’s positions for 17 years in multi-national, local and publicly listed companies. He led in the successful turnaround of several troubled companies. He is currently the Managing Director of a business advisory firm, Corporate Turnaround Centre Pte Ltd, which assists companies on a fast track to financial performance. Dr Teng was the President of the Marketing Institute of Singapore (2000 – 2004), the national body representing some 5000 individual and corporate marketing professionals in Singapore