Explain ‘threat of substitute products’ as a business risk. – InterviewSolution

1.

Explain ‘threat of substitute products’ as a business risk.

Answer»

The threat of substitute products:

Change in technology, reduced price, price rise customer preference, etc. may divert a customer to use other substitutes of a product available in market.
For example, when ball pen was invented people started using it more compared to traditional ink pens.
Other examples are steel vessels instead of copper, dalda ghee instead of desi ghee, etc.

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