1.
Understanding
Competitive
Advantage
WILLAH JOSEPH
MUDOLO

2.
Understanding
Competitive
Advantage
For many businesses across the world, one of
the main challenges in remaining profitable is to
have a competitive advantage over competitors.
By definition, a competitive advantage is a
condition (or set of conditions) that allow a
business to produce goods or services at a lower
price or by providing better benefits that can
justify pricing higher.

3.
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The presence of these
conditions allows the
business to have more
sales or achieve better
margins compared to other
competitors in the industry.
In many cases, competitive
advantages can be traced
back to a number of
factors, including branding,
customer service, costing,
quality of offerings,
intellectual property and
distribution channels
employed.
In the long run, a
firm's ability to sustain
competitive advantages
makes it difficult for
competitors to attack the
advantage. In business, the
competitive advantage can
be seen in two angles:
• Comparative Advantage.
Comparative advantage
explains a firm's ability to
produce a service or good
more cheaply than others
in the market. Given the
option, many consumers
will purchase the cheaper
of two substitute products.
Comparative advantage
The presence of these
conditions allows the business
to have more sales or achieve
better margins compared
to other competitors in the
industry.
does not necessarily mean
a better product; it means a
firm can produce a product
of the same value at a
cheaper cost.
• Differential Advantage.
With differential advantage,
a firm's products in the
market are seen as different
from competitors and can
also be perceived as more
superior as a result of, for
example, better technology,
a strong brand or highly-
skilled personnel.

4.
Willah Joseph
Mudolo
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.Willah Joseph Mudolo