Rivalry Among Competing Firms Assignment Help

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Rivalry can be found every where; especially in the field of business, its existence is quite prominent and definite. In the competitive market, firms have to face lots of challenges and have to fight a lot,for keeping up their existence in that market. These business challenges amongst all firms are classified in to five distinct categories which are commonly known as ‘Porter’s five forces.’Competitive rivalry is one of the most significant parts of these forces.

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Something more about the subject matter

Students who want to build their future career in business and Industries must know every tit and bit about these challenges for long existence.  Now we are going to discuss the determining factors of competitive rivalry, and they are:

  • Existence of lot of competitors

More competitors create more compaction hence; it can be marked as a determining factor of this challenge. Diverse competitors also a huge threat for a company.

  • Slow growth of industries

When an extremely slow growth exists in the market,then the company cannot make much profit they have to depend only on market share hence a competition arises there.

  • Decline movement of industry

In this situation sales volume is going to reduce in the market hence, a big competition is immersed there. 

  • Large-scale Capacity increment

Due to this reason ratio of industry’s supply and demand is disrupted hence, gradually a time of overcapacity and price cutting evolve there that leads to a tough fight.

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Affected factors

Due to this competition, several business factors have to receive several effects because company tries to change its strategies for survival. The affected factors are discussed below.

  • Reducing pressure on price of the product is created due to perfect competition
  • The company tries to be more innovative about the product to beat their competitors. Hence, innovation cost increases.
  • Business organizations want to make better promotion than their competitors for their own So they spend a huge amount on advertisements, and due to their business rivals, this amount is going to increase day by day.
  • The quality of the product and service is improved due to this rival competition.

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