(Solved): Our client, Chupa Chip Microchips is a leading niche microchip manufacturer that owns around 30% o ...

Our client, Chupa Chip Microchips is a leading niche microchip manufacturer that owns around 30% of the global market. Chupa Chip's main competitor, Megaship Microchips, also owns around 30% of the global market while the rest is fragmented between smaller players. Due to recent geo-political developments, the cost of transistors, which are a component of a microchip, has increased dramatically. In order to cope with the increase in cost, our client has decided to increase the price of its product by 2$ which led to an immediate 20% drop in market share. After conducting market research, our client was surprised to discover that Megaship Microchips has not increased the price of its product. What is even more surprising is that the competitor does not seem to have had a dip in profit. Other than cost, what are the potential advantages and disadvantages of outsourcing?