Current Price

EXPERIENCE (ACCUMULATED VOLUME)

FIGURE 18-12. Profitability advantages of greater experience (market share). Source: Adapted from "The Experience Curve Revisited: I. The Concept," The Boston Consulting Group, 1974, Perspectives, no. 124.

Both firms A and B could bid the job and make a profit, with firm A making more profit. However, if firm A lowers its price to a point below B's cost per unit, then A could drastically improve its changes of winning the contract, but at a lower profit.

Project Management Made Easy

Project Management Made Easy

What you need to know about… Project Management Made Easy! Project management consists of more than just a large building project and can encompass small projects as well. No matter what the size of your project, you need to have some sort of project management. How you manage your project has everything to do with its outcome.

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