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The nature and intensity of competition in a market depends upon five main
forces - the threat of new entrants, the bargaining power of the suppliers,
the bargaining power of the customers, the threat of substitute products,
and threats from the present competitors. Competition enables a company to
perform better than its rivals in the marketplace. In order to formulate
effective strategies, a company has to have extensive knowledge about the
competitors. Competitor analysis helps a company to identify the key
competitors in the market, their strengths, weaknesses, and what makes the
competitors successful.
This analysis enables the company to discover the reasons for a customer
selecting their product rather than the competitors'products, and thereby
helps it to provide superior value to the customers. However, some companies
overlook such an important analysis in their management process. The absence
of competitor analysis in a company can be attributed to overconfidence,
confusion, legal concerns, and misinterpretation of information on the part
of the management. |
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Short Case Studies / Caselets
