Why is the competitiveness of an enterprise important?

News and Society
Loading ...

Analysis of the competitiveness of any enterpriseincludes a study of external and internal competitive advantage that allows not only to strengthen the company's position in the operating sector, but also to enter new markets, offering consumers newer and more modern products.

The external advantage is based on the abilityfirms offer buyers a better product, the main advantage of which is a higher moral and aesthetic satisfaction of the population, while reducing costs and improving the efficiency of the return on its implementation. The competitive advantage of this type strengthens the company's position in the market, and also uses the strategy of distinction (differentiation) as the most important component of its advantage.

As for the internal advantages, hereCompetitiveness analysis is based on the company's superiority in costs and costs, which it spends on the creation or delivery of goods. In other words, here the company's marketing strategy is aimed at reducing costs and, consequently, the final price of the product, as a result of which it is possible to increase sales in the segment of the population with a small financial income. Such an analysis allows the company to be more profitable, and also resists further price reductions from potential competitors in the event that other companies also begin to reduce prices for similar goods or services.

Thus, the analysis of the firm's competitivenesssets itself the main goal - to find out what specific competitive advantages the firm can achieve, as well as how to maximally effectively protect its financial interests. The latter fact directly depends on how much the company can successfully resist the pressure of the main competitive forces represented in the market, and a competent analysis of competitiveness allows us to find out.

All managers are well aware of M. Porter's competitive advantage model, which includes an analysis of the five competitive forces that any firm operating on the market is exposed to:

- dependence on major suppliers;

- dependence on the main consumers;

- competition in the industry;

- the threat of replacement of basic goods and services;

- the threat of new competitors coming.

Competent analysis of the main competitiveadvantages of the company is also important because it allows you to objectively assess not only the existing position of the company and the niche that it occupies but also to determine the opportunities for expanding and strengthening positions in the market due to those factors that, as a result of the analysis, will be singled out as the main ones. As an example, we can give a plan for analyzing the competitiveness of one of the enterprises engaged in knitted goods.

At the first stage, such parameters asgrowth rates of production, market share and analysis of the main analogues. Further, the main list of competitors is compiled, after which a plan is drawn up to include the main competitors in terms of their impact on the market. Among the many factors, the following categories can be distinguished:

Management of organization and management of the enterprise:

- strategy;

- Tactical goals and objectives;

- entrepreneurial philosophy and culture;


- equipment and its updating;

- quantity of products;

- dependence on suppliers;

- Flexibility of production lines.

Marketing strategy:

- assortment of goods;

- wholesale and retail trade;

- fame of the company;

- advertising;

- prices;

- the speed of reaction and changes in fashion.

Thus, the analysis of competitivenessenterprises on the example of the plan-scheme clearly shows which factors should be paid attention to when carrying out the relevant studies. The importance of this whole process is manifested not only in a clear understanding of the market situation and the determination of its location in the market, but also the opportunity to assess the entire potential of the company, including hidden. In this respect, the analysis of competitiveness is extremely important and is a necessity in any modern firm.

Loading ...
Loading ...