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Jacob Sarma, Managing Director, Service2Home Pvt. Ltd is working on developing a competitive strategy to ensure that Service2Home can take on the existing and the potential competition in the market.
Service2Home is in the business of providing domestic help through a network of registered maids to middle- and high-income households in urban areas. It offers different service packages at different prices. The flexibility of the service package design is such that customers themselves can formulate their service package based on their choices.
Though the rising number of working women and nuclear families in these areas increased the demand for domestic help, Sarma had to work hard to assuage customer apprehensions regarding domestic help during the initial phases. Incidents of theft, physical attack, reports of intelligence to robbers and so on were quite common, which made consumers wary of using the services of the company. Sarma assured customers that they could rely on the service personnel provided by the firm. Although some customers were unhappy about the prices of the services, the feedback on the service quality was positive from all groups of customers. Thanks to such efforts, Service2Home managed to carve a niche for itself in a very short time.
Now, it is facing competition from individual maidservants who offer the same services at lower prices and from price-sensitive customers who perform the services on their own instead of hiring any one. It had been relatively easy to capture the high-income segment as compared to the price-sensitive middle-income group. Now, Sarma wants to consolidate the position of the company in both the segments. He wants to build distinct competencies that would make it difficult for new entrants to compete with the fi rm. He plans to attract more independent maidservants to register with the company. He needs to work out a comprehensive strategy to establish Serve2Home as the market leader in the long run.

1. How can Service2Home gain competitive advantage in this business?

2. Do you think Sarma’s strategy of attracting independent maidservants is workable? Will it eliminate competition?

3. What are the potential threats to the company?

4. What strategy would you adopt to achieve the company objectives towards competition?