Should Becton Dickinson alter their current pricing strategy and enter in agreement with APG and thus shift end-users’ perception from BD being a differentiator to price leader?
Becton Dickinson is being asked to revise their initial proposal, presented on August 1, 1985, subject to rejection. Lowering their prices as well as having all their blood collection products be part of APG’s private-label program is part of APG’s stipulations. This presents an opportunity for BD to increase sales and market share, but could also entail potentially compromising their current distributor relationships, as well as their image of being a product differentiator. A major concern involving this strategic transition will be BD’s ability to retain its current market power despite adopting a price leader position in the industry.
Becton Dickinson has until August 15 (two weeks), 1985, to submit a new proposal with APG. This time constraint poses a challenge for company managers to make a quality decision in a timely fashion.
* Diverse product portfolio
* Possess high market share (80%)
* VACUTAINER Systems
* offer a wide selection of blood collection products
* products are available for both single and multiple sample collection
* quality control is imperative
* Reputable product quality
* Solid infrastructure in place
* First industry entrant
* Z-contracts are... [continues]
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