Business Competition: Definition, Types, Importance & Examples

Disadvantages Of Business Competition

Business competition isn’t always beneficial too. High competition has the following disadvantages –

• Reduces the market share of the business: A rise in competition makes the business share its market with other players. This is often unwelcomed by the existing businesses.
• Puts pressure on business: Competitions puts much pressure on businesses to up their game and results in many of them failing because of their inability to compete with the big market players.
• Employees feel pressurized: Increased competition adds much pressure to employees to perform well and think out of the box. Many employees can’t cope up with this increased pressure.
• Makes business spend unnecessarily: Competition often makes a business overspend on marketing and other promotional strategies to woo the customers, business partners, and employees. This adds to the expense and is often unnecessary.

Business Competition Examples Coca-Cola And Pepsi

• Coke vs. Pepsi is a great example of direct competition where both of these companies offer almost the same product but try to build their market share using marketing and positioning strategies.
• DHL and FedEx are direct competitors which offer courier delivery service all over the world. They differ in specialized services and add-ons like providing overnight delivery, long-distance delivery, etc. They also try to build their market share using price wars.

Constantly competing companies

• MCDONALD’S VS. BURGER KING
• FORD VS. GM
• NIKE VS. REEBOK
• Apple VS. Samsung
• Thomas Edison vs. Nikola Tesla
• Airbus vs Boing
• DUNKIN’ DONUTS VS. STARBUCKS