CA Intermediate · Financial Management and Strategic Management · Strategic Choices
Himalaya Organics, a maker of herbal teas sold only in North India, now starts selling the same teas in South and West India through new distributors, without changing the product. In the Ansoff matrix, this is best described as:
This is market development in the Ansoff matrix. The company sells its existing herbal teas in new geographic markets. Penetration would stay in North India, product development would launch new teas, and diversification would change both product and market, so none of those fit.
- AMarket developmentCorrect
- BMarket penetration
- CProduct development
- DDiversification
Explanation
An existing product is being taken to new markets (South and West India), which is market development. Market penetration would mean selling more of the existing product in the existing markets. Product development needs a new product, and diversification needs both new product and new market.
Did you get it right without looking?
One question tells you little. A timed set on Strategic Choices shows your real accuracy, how long you take and where you lose marks.
More Strategic Choices questions
- Himalaya Cycles sells bicycles in north India. It now plans three moves: (i) selling its existing cycles in Southeast Asian markets, (ii) la…
- Bharat Tyres Ltd, a Pune-based tyre maker, buys a rubber plantation in Kerala and starts producing its own natural rubber, which it earlier …
- Kaveri Textiles Ltd faces falling demand and rising losses in its core business. Management decides to cut costs sharply, sell surplus asset…
- Two Indian cement companies agree to share costs of a new logistics platform and a joint R&D facility, but each continues to operate indepen…
- A Coimbatore pump manufacturer buys castings from outside suppliers. To secure supply and control quality, it acquires one of its main casti…
- Tarini Foods, a Pune-based packaged snack maker, buys a regional rival that supplies the same type of snacks to the same retail chains, to g…