2.5.3 Competitive Environment Flashcards
1
Q
Competitive Environment
A
The degree to which a business is affected by rivals that operate in the same market.
2
Q
Impact of competition on businesses
A
+ Increased innovation - focusing on USP’s.
+ Improved customer service.
+ Expand product range.
- Fall in prices.
- Increased costs of promotion.
3
Q
Market size
A
The number of buyers and sellers in a market.
4
Q
Large markets
A
+ Larger customer base.
- Higher costs of promotion.
- More competition.
5
Q
Small markets
A
+ Less competition.
- Limited demand.
- Few economies of scale.
- Threat of new entrants.
