Nimble on your feet...
I’ve talked before about the benefits of collaboration and how even competing businesses can benefit by working together.
But what about the actual benefits of competition in a marketplace? As consumers, we understand that competition is beneficial. The introduction of choice can drive higher quality, innovation and efficiencies resulting in better products for the customers often at better prices. But how does that help the businesses who are in that market?
- If there is more competition then there is likely to be more awareness of the product with the competitors all working to raise the awareness. This can increase the market itself, so even a small share of the market may be lucrative.
- A competitive market is likely to have a knock on effect on the suppliers to that market which may drive costs down and allow space for improvements and better products for lower (or similar prices) which can drive up consumption.
- In a competitive market differentiation moves to product features and benefits, which can result in more innovation, with higher consumption as the innovation opens up sub-markets.
- In a competitive market, you are kept lean, efficient and have to avoid stagnation. This keeps you strong to cope with new entrants to the market.
As long as the market is not saturated, a competitive market may not be as bad for you as it seems. So don’t knock your competitors, be glad that they’re keeping you strong and nimble on your feet.
Oh! Keep your eye open for opportunities to collaborate.
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