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Because her current supplier is boosting its rates, Deborah is thinking about switching to a different cell phone service provider. Deborah, however, finds the idea of looking around for a new carrier that is less expensive and provides comparable coverage to be time-consuming and frustrating. Deborah ultimately makes the decision to stick with her existing service provider because of of the cost of switching providers.
Which of these would have substantial switching costs?
Time, distance, convenience, and even gas prices are switching expenses in this situation when transferring grocery stores. A case of significant switching costs is this. These are some illustrations of switching costs that are both concrete and abstract.
Why is it tough to change suppliers?
Frequently, moving providers may need that the client acquire new abilities/expertise to utilize the new good or service (e.g., financial accounting software). Finally, some customers find it expensive to invest the time and energy needed to communicate their needs and information to a new supplier.
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