CA Intermediate · Financial Management and Strategic Management · Strategic Choices
Himalaya Cycles sells bicycles in north India. It now plans three moves: (i) selling its existing cycles in Southeast Asian markets, (ii) launching a new electric cycle model in its existing north Indian market, and (iii) launching the electric cycle in Southeast Asia. Which option correctly matches these moves with Ansoff's matrix growth strategies?
Selling existing cycles abroad is market development, launching the electric model in the current market is product development, and launching it in Southeast Asia is diversification because both product and market are new. Market penetration would involve only existing products in existing markets.
- A(i) market development; (ii) product development; (iii) diversificationCorrect
- B(i) market penetration; (ii) product development; (iii) diversification
- C(i) market development; (ii) market penetration; (iii) product development
- D(i) product development; (ii) market development; (iii) diversification
Explanation
Existing product in new market is market development. New product in existing market is product development. New product in a new market is diversification. Market penetration means selling more of existing products in existing markets, which none of the moves does, so the penetration options are wrong.
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