Competitive environment Flashcards
1
Q
How does increased competition affect a business (Structured)
A
competitive environment definition
what would more competition do to the business?
- loss of sales, market share and fall in profit margin
price competition?
- lower prices but it will lead to a fall in profit
non-price competition?
-innovate existing or new products but it will lead to higher costs
However:
does it even affect the business?
-if you have a high market share and strong brand it might not.
- Competitors may be far too powerful and you might need to leave the market or focus on a niche
