Quick Answer: What Is The Basis Of Competitive Advantage?

What are the bases for competitive advantage?

The fundamental basis of above average profitability in the long run is sustainable competitive advantage.

There are two basic types of competitive advantage a firm can possess: low cost or differentiation.

The focus strategy has two variants, cost focus and differentiation focus..

What are the 6 factors of competitive advantage?

The six factors of competitive advantage are: Price, location, quality, selection, speed, turnaround and service.

What are the 5 areas of competitive advantage?

5 areas to drive competitive advantageMARKETING. How can your marketing team make claims about your product and the ability to deliver it without knowing the capabilities of your supply chain? … FINANCE. Here are two departments which ought to be so close their husbands and wives start to get jealous. … HUMAN RESOURCES. … LEGAL. … CUSTOMER SERVICE.

What are the three types of competitive advantage?

There are three different types of competitive advantages that companies can actually use. They are cost, product/service differentiation, and niche strategies.

What is an example of competitive advantage?

Three great examples include: McDonald’s: McDonald’s main competitive advantage relies on a cost leadership strategy. The company is able to utilize economies of scale and produce products at a low cost and, as a result, offer products at a lower selling price than that of its competitors.

Why is it so hard to gain a competitive advantage?

It is hard to gain a competitive advantage because becoming different and achieving what others or other products do not possess is not at all easy. It requires a lot of time, planning, dedication, and determination to grow above all and gain competitive advantage over competitors.

What is Coca Cola’s competitive advantage?

Coca Cola has competitive advantage so it is making it get bigger and bigger in terms of sales and market share. Coca Cola reputation has also competitive advantage and it is also pursuing environmental friendly product. Coca Cola many products are recyclable and Coca Cola is also going for the green effect.

What is the concept of competitive advantage?

Competitive advantage refers to factors that allow a company to produce goods or services better or more cheaply than its rivals. These factors allow the productive entity to generate more sales or superior margins compared to its market rivals.

How do you gain competitive advantage?

6 Ways to Gain Competitive AdvantageCreate a Corporate Culture that Attracts the Best Talent. … Define Niches that are Under-serviced. … Understand the DNA Footprint of Your Ideal Customer. … Clarify Your Strengths. … Establish Your Unique Value Proposition. … Reward Behaviors that Support Corporate Mission and Value.

How do you achieve cost advantage?

There are two major ways to achieve a cost advantage:Control cost drivers. A firm can gain and advantage with respect to the cost drivers of value activities representing a significant proportion of total costs.Reconfigure the value chain.