allow an increase in profitability : should allow the company to have an increase in profitability that at least reaches placed above the average profitability of the sector or market. be sustainable over time : it should be able to stay in the medium or long term; for example, a technology able to adapt to market changes and not one that will shortly become obsolete. be elusive or even : to be elusive or even by the competition; for example, a product difficult to imitate by competitors due to its unique components. The idea of the concept of competitive advantage is that a company must constantly seek obtain, maintain that or those who already have, and make the most of, if you want to achieve a better performance than other competing companies, and thus have a position competitive in the sector or market. There are several ways to gain a competitive advantage, but the two main ones are looking for a cost leadership (a comparative advantage or cost advantage), and seek a differentiation (a differential
3.2 RANGE OF STRATEGIES THAT CAN CONTRIBUTE TO A BUSINESS COMPETITIVE ADVANTAGE When a business thrives in gaining competitive advantage, it often sets eyes on a manifold of strategies that aim to em-better its image and its competitive positioning. It focuses on strategies that may help increase its rate of consumers acquisition, retention and satisfaction; strategies of industry and competitors analysis. Moreover, it sets eyes on those strategic process to build strong investments portfolios ( Liquidity) that can help establish longevity and leadership in the market. Competitive advantage inevitably leads to faster, continual exponential growth, increased sales, market share gains and overall business profitability. Competitive
Competitive advantage of a firm is the edge that it has over its competitors (Altharti 2012).It is important to state that competitive advantage (CA) cannot be achieved without a business strategy or business model. It is the business strategy, which is the management game plan for creating value for stakeholders and earning a reasonable return on investment that gives a company a competitive advantage over rivals in terms of higher financial performance on revenue, return on investment etc. The author accepts that Porter’s generic strategy and value chain are important tools in understanding the competitive strategies being deployed by rivals in any industry analysis. An understanding of the generic strategies such as the broad low cost provider, broad differentiation strategy, and narrow focus strategies on cost and differentiation being deployed by competitors can provide opportunities for existing and potential competitors by trying to achieve a lower cost or better differentiation by rivals. The value chain is an internal analysis of how an organization organizes
Competitive advantages are often described as conditions that allow a company to produce a good or service at a lower price or in a more desirable fashion for customers. These conditions allow the productive entity to generate more sales or superior margins than its competition. Competitive advantages are attributed to a variety of internal and external factors, including cost structure, brand, quality of product offerings, distribution network, intellectual property and customer support, as noted by investopedia (2017). Competitive advantage provides companies with an edge over its competitors and an ability to generate better value for a company and its shareholders. The more sustainable the competitive advantage, the more difficult it is for competitors to neutralize the advantage.
Competition leads to innovation. If you’re the only player in the field, it can be difficult to improve. And if you’re working in a crowded market, you won’t succeed by doing what everyone else does. Healthy competition encourages change which will distinguish your company from others through technology, products altercations or by improving the customer experience. In the business world today the customer is the most important person to please.
Competitive advantage is being run for and more companies are investing in IT in order to reach quality and quantity of goods and services. They are replacing their operating models by using Internet and new software’s. Organizations that are making changes in their sectors by including information technology innovations are gaining competitive advantage. This is called Schumpeterian competition. This turn towards innovations
This can produce attractive and competitively priced products. They will be able to manage competitive threats from bigger rivals with new products in the existing market. To do this they will need to invest in innovation in all areas to keep competitive in these industries. (Lewis, J.
There are many different cost and structures that need to be considered when forming a profitable business. A companies expansion can play a role in how some of these concepts are engaged. Furthermore, understanding the level of success a company has can be measured in multiple ways. In this paper I would like to discuss the types of costs a company can expect to have, and they ways these cost can be determined and understood. Then closing with an explanation of how these can affect an expansion of our business and profits.
1. Introduction The success of a company greatly depends on its access to resources which grant it a competitive advantage (Peng, Pinkham & Chen, 2009; Rugman, 1981). Resources, which can be important for a company, include “knowhow, raw materials and components, marketing and distribution services [and] financial capital”
This is key to any firm. As mentioned in the essay, one of the reasons customer-centric firms successful is because they cater to the demands of customers. They prioritise what matters. They do not need to subsidise their products in order to boost sales in comparison to a product-centric firm who may need to introduce a sale in order to shift their goods. Customer trust and loyalty gained through the market structure reduces the marketing costs of such firm.