Product customisation: an empirical study of competitive advantage and repeat business

Empirical evidence is presented from 24 UK based manufacturing companies, all offering a degree of product customisation, with most having a significant pure customisation engineer-to-order (ETO) element. The evidence addresses the issue of competitive advantage, which has lacked empirical evidence in previous manufacturing strategy literature, and includes a detailed investigation of the strategic importance of repeat business. It contrasts its results with those previously found in the literature and concludes that there are significant differences in the competitive priorities theoretically associated with this sector. In particular, it is argued that cumulative capabilities are needed, with a low cost competence often included. Four different types of repeat business are identified, one relating to repeat business customisers and three relating to versatile manufacturing companies, and the strategic importance of repeat business is discussed. It is indicated that for some ETO companies, repeat business is perceived to be an important method to reduce costs and achieve business stability. However, a number of the other companies studied saw repeat business as infeasible and hence need to find other ways to reduce costs and improve company performance measures. Future research to extend this work into a longitudinal study or a broader survey is proposed