Topic 1.2.4 The competitive environment Flashcards
What are the strengths and weakness of competitors?
Price-Offering lower prices than than other competitors may attract more customers.
However could result in more sales but also will increase the costs for the business as they must produce more to meet the increased demand-if they don’t make enough extra sales their overall revenue may be less than before and profits may be lower
Quality-A business may decide to offer better quality goods/services,this will attract consumers that want good quality product and are willing to pay a high price.However could increase costs of the business
Location-A business is located closer to customers and more easy to access which is more convenient for customers resulting in higher sales.
Product range-Meets the customer need of choice,attract customers that want different services.
Customer service-Good customers service lead to increased customer loyalty,satisfied customers leave good reviews.However training staff in good customer service leads to increased costs.
Impact of competition on business decision making?
Business would need to identify better opportunities to meet customer needs.May need to to do market research.
