Switching Costs

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Dictionary Says

Definition of 'Switching Costs'

The negative costs that a consumer incurs as a result of changing suppliers, brands or products. Although most prevalent switching costs are monetary in nature, there are also psychological, effort- and time-based switching costs.
Investopedia Says

Investopedia explains 'Switching Costs'

Sustainable companies usually try to employ strategies that incur some sort of high cost in order to dissuade customers from switching to a competitor's product, brand or services. For example, many cellular phone carriers charge very high cancellation fees for canceling a contract. Cell phone carriers do this in hopes that the costs involved with switching to another carrier will be high enough to prevent their customers from doing so.   
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'Switching Costs'

  • Economic Moats: A Successful Company's Best Defense

    http://www.investopedia.com/articles/fundamental-analysis/08/moats.asp
    ... Two examples of industry giants are Microsoftand Wal-Mart. High Switching
    Costs Being the big fish in the pond has its advantages. ...

  • Progress Software - A GARP Story With No "Guh"

    http://stocks.investopedia.com/stock-analysis/2012/Progress-Software---A-GARP-Story-With-No-Guh-PRGS-IBM-ORCL-MSFT0106.aspx
    ... be a symptom of increasing penetration from open source rivals like Red Hat
    (NYSE:RHT) or Apache where the argument can be made that switching costs are low ...

  • Advertising, Crocodiles And Moats

    http://www.investopedia.com/articles/06/admoats.asp
    ... valuable patents or being the sole provider of a product or a service; having a
    dominant position, brand or logo recognition; and having high switching costs. ...

  • Propane Plays Can Power Your Portfolio

    http://stocks.investopedia.com/stock-analysis/2009/Propane-Plays-Can-Power-Your-Portfolio-APU-SPH-FGP0107.aspx
    ... tank. The switching costs and property/infrastructure damage to remove
    the storage tank outweigh the few dollars of savings. In ...

  • Autodesk Still At The Drawing Board

    http://stocks.investopedia.com/stock-analysis/2011/Autodesk-Still-At-The-Drawing-Board-ADSK-DASTY-PMTC-ADBE-AVID-ANSS-CDNS0525.aspx
    ... people use this program every day and it is relatively common in schools and training
    programs, so there would definitely be some switching costs involved if ...

  • Using Porter's 5 Forces To Analyze Stocks

    http://www.investopedia.com/articles/fundamental-analysis/11/using-Porters-5-forces-for-stock-analysis.asp
    ... However, to determine whether such a threat is realistic, various considerations
    must be made such as switching costs and the practicality of alternative ...

  • 5 Ways To Save On Child Care Costs

    http://www.investopedia.com/articles/pf/09/daycare-saving-tips.asp
    ... approach where each parent leverages a flex schedule at work can slash child care
    costs. More and more parents are working from home or switching their hours ...

  • How And When To Switch Your 529 Plan

    http://www.investopedia.com/articles/pf/09/529-college-plan-switch.asp
    ... Also be aware of any costs or consequences of switching plans before doing so.
    There are a number of reasons to consider switching 529 plans. ...

  • Health Insurance: Paying For Pre-Existing Conditions

    http://www.investopedia.com/articles/pf/09/covering-medical-costs.asp
    ... For more insight, read Fighting The High Costs Of Healthcare ... private insurance, read
    Buying Private Health Insurance.) Scenario 3: Switching Insurance Providers ...

  • Autoliv Will Ride High Again

    http://stocks.investopedia.com/stock-analysis/2011/Autoliv-Will-Ride-High-Again-ALV-MGA-VC-TRW-AXL1027.aspx
    ... including "collision warning, lane departure warning, automatic high beam switching,
    as well as traffic sign recognition.". Higher product costs resulted in a ...

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