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    Cannibalization Threat to a Manufacturing Company

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    Why would cannibalization be a threat if the manufacturing company benefits through sales revenue maximization, reduced inventory hence lower carrying costs, economies of scale, and market penetration gains?

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    It is a short term fix, launching a product that cannibalizes your own lines, and this happens a lot in the business world. The benefits seem so attractive that it makes common sense to go ahead with this strategy.

    Let's say you are selling coffee for example, your company holds 80% of the market shares of a given territory. The retailers want your product and also want you to ...

    Solution Summary

    This solution of 283 words discusses cannibalization as a threat in a manufacturing company through a worked scenario.