Marketing Strategy Of The Tti Generic Business Strategy For Their Tax Preparation Business

1258 Words Oct 27th, 2015 6 Pages
When looking at the TTI generic business strategy for their tax preparation business, the firm originally operated and competed as a cost leader that also had a first mover advantage. When it first opened, the company saw the advantage of offering cheaper tax services than the CPAs. To achieve the cheaper price, the company made the conscious decision of hiring inexperienced employees, who they could then train, instead of CPAs. This ensured that their costs would be much lower than the average CPA firm, since CPAs are likely paid more. When it was just them in the market, they were the only players in tax preparation that was offering a cheaper service and TTI was able to pass that cost savings off to their customers. The company chose to compete on price against these CPA and mom-and-pop shops that were more specialized and dealt with higher income individuals.
To examine if TTI has created a competitive advantage in this business, it’s important to examine the company’s resources and capabilities through Porter’s Value Chain (PVC). This industry is fundamentally different than a normal industry under PVC because it provides a service. Thus each part of PVC is being adjusted from what it would with a manufacturing firm to what it is in this tax service business. The first area is inbound logistics, which for TTI, is their ability to bring in “raw,” untrained potential tax preparers. The next major primary activity is operations, which is their ability to turn these raw…
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