Such approaches if adopted by the Canadian companies entering BOB markets are unconventional for the organizations, and thus, their efficiency may be reduced. Also, conducting pilot projects may be needed and may increase to the costs. Additionally, selling to people at the low-income level needs adapting to their affordability level of the targeted market and thus, the prices will be low. The BOP strategies will lead to the Organizations getting ultra-thin margins because of the high operation cost and low prices. To curb this then, and get the fortune at the BOP, the organizations will need to scale up the volumes of their services and products so as to cater for the low margins. Thus, scaling up is the major challenge that the organizations targeting BOP markets will face. The first difficulty in increasing the BOP techniques is the difficulty in attaining economies of scale (Vachani & Smith, n.d., p. 43). Catering to the isolated BOP in the rural areas with low incomes means high fixed costs. In addition, the business models of the BOP strategies that organizations develop might not be adapted to attain a large scale. Thus then, in order for the companies to scale up the BOP strategy, they will need to invest more volume of services and goods which call for more and more …show more content…
It may seem to be a controversy to scale up a locally embedded BOP strategy. Locally embedded strategies address specific needs of the population and they are made to overcome indigenously occurring challenges. The conditions and need may vary greatly from one place to another, and even more, from one part of Canada to another. The locally adapted strategy then results to be less adequate in other places, and its replication seems strenuous. The needs of a population differ greatly indeed, and a service or a product may require being remodified so as to fit another BOP market in Canada. This. Scaling up a locally embedded strategy needs coming up with, and implementing an indigenously embedded strategy in