Give an Example of Companies Establishing High Switching Costs to Gain

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The Answer is Manufacturers of laser and ink-jet printers sell their printers at cost or below cost.However,once you purchase a printer,you must replace a depleted ink or toner cartridge with one that the printer manufacturer sells,or take a risk with other cartridges whose quality is often low.As a cartridge customer,you face high costs if you consider switching to another brand.Even if comparable cartridges from another manufacturer are less expensive,you cannot use them;and if you decide to use those cartridges,you will lose your investment in the printer,because you must buy a new one.Thus,establishing high switching costs often locks in customers.Locking in customers by any means is a way to accomplish a strategic advantage.

Give an Example of Companies Establishing High Switching Costs to Gain

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