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Competitive advantage in business

ArticleID 129  
Writer Isaac Thuku
Category Personal Article

In this modern world, businesses experience stiff competition and changes in technology which affect the trading market. In order to remain relevant, businesses need to create methods of survival which include a sustainable competitive advantage.

Sustainable competitive advantage consists of the moves and approaches taken by firms to attract buyers who are under pressure from other competitors. This improves the firm’s market position. The main concern is eclipsing the rivals and winning the competitive edge in the market place. Values such as lower prices for consumers are created. There are five criteria for sustainable competitive advantage.

Customers always want unique products and services. Uniqueness is vital to every business success. Goods and products from one business or company should stand out from the rest. Unique products will give entrepreneurs an advantage of originality where other businesses won’t be able to emulate. Prices of goods and services will determine how many customers will flock your business. Many people tend to be attracted by low priced goods and services rather than expensive ones so long as the quality is good.

Quality products are a hot cake in every business venture. Demand increases with how high or low the quality is. Quality goods and products are always expensive and purchased by fewer customers who can afford them. Quality of products varies from one brand to another.

Competition occurs when firms offer the same products and services in the same market. The competition is more intense in low return businesses. It poses a huge challenge to organizations and companies as those not able to compete are forced to exit the market. To survive in the market, new strategies need t be crafted. A business premise needs to understand the competitor well in order to establish how to tackle him.

Competitive strategy aims to establish profitable and sustainable position against forces which determine competition. The choice of competitive strategy is anchored in attractiveness of industry for long term profitability and its determinants. Competitive strategies are part of business or corporate strategies which deal with management plans for competing successfully.

It helps on how to build competitive advantage, its offensive and defensive moves to counter rivals, how to defend against competitive pressure, how to strengthen the firm’s market position in the industry and securing competitive advantage over rivals. The goal is to gain an advantage over your rivals.

Building strong competencies and competitive strategies which are difficult or costly for rivals to emulate would push a company closer to operational excellence. This is the best way of creating a sustainable competitive advantage.

Core competence entails what a business does better compared to the competitors. It is embedded in quality control, ability to provide better services, know-how in cost advantage, superior design capability, unique ability to pick out a good market location and inventories in developing new products.

Firms can build strong competitive advantage with a core competence in an area important to market success, when rival firms lack off-setting competencies and when it is costly and time consuming for the rival firms to match the firm’s competence. Core competencies and competition capabilities are important avenues for securing a competitive edge over rivals.

Competitive advantage in business
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