What is Competitive Risk?

Competitive Risk: 

The risk that our competitors have additional advantage over us and they do better than us. There can be several reasons for our competitor to have added advantages such as:

1. He is older in market than me. If you want to beat this norm of your competitor, you need to build in more relations in the market than the competitor does even if it takes you to go overseas and have partners there.

2. He gives Steep discounts over my products. If that is the case, as a business person you need to remember that nothing can beat quality. So if you improve the quality of your product at a level where your competitor has no say, you can win over.

3. His business model is innovative so does it's products. You can always better on this factor by adjusting your product model example, his product is superior in terms of space it consumes, you try and develop smaller product, his product tastes better, you try to improve in the quality of your product by adding an ingredient which your competitor is not aware and so on.

4. His stores exist in better location. No problem, you go online. He is already online. No problem, you give at home services. He already gives home services, no problem, you manage a better packaging then him. His packaging is better. No problem, you have equivalent package and increase your quantity a bit (say 100 grams if you are into spices business).

5. My competitor gives better compensation so talent moves over to him. No problem, you create conducive environment to your employees, have employee friendly policies and have incentive based model for your employees.

6. He has lots of money so has better promotion techniques. No problem, use word of mouth techniques, use social medias available for free etc.

7. He has more distribution retailers. No problem, you build your niche and build your network in your niche.

8. He has secured key intellectual properties. No problem you modify your designs and get patented.

We have all the solutions for designing strategies against the competitor, we just need a thinking hat.