Palmistry 

Dirty methods of competition. Forms and methods of competition


The main methods competition in modern conditions are:
1. price;
2. non-price;
3. unfair methods of competition.

Price methods are characterized by the fact that in the competition for the consumer and the conquest of the market, such a technique as price reduction is mainly used. An entrepreneur who has made such a decision believes that by lowering the price of his goods he will be able to defeat (ruin) his competitors. Having seized a dominant position in the market, the entrepreneur seeks to make up for the temporary loss of profit by the subsequent rise in prices. This method of competition was widespread in the past in Western countries (XIX - the first half of the XX century).

At the end of XX - beginning of XXI century. this method in USA and countries Western Europe practically not used. Market in developed countries ah stable, long peacefully divided and monopolized. Because of this, preference is given to conservatism and price stability. With this approach, profit growth is achieved by reducing production costs and marketing research and techniques. Thus, the price of men's shirts in the US has remained stable for the second decade - 15-20 dollars apiece.

World management experience shows that in modern conditions the use of price methods in competition, as a rule, ends in embarrassment. For example, in the 80s of the XX century. one of the US companies for the production of aluminum in the fight against domestic competitors gradually reduced prices up to the extreme limit - below the level of profitability. It is clear that competing companies were forced to do the same. As a result, even cheaper aluminum from Western European countries poured into the American market, which led to the bankruptcy of the initiator of price competitive methods.

In modern conditions, in addition to the traditional price reduction, the main methods of competition include the reduction of production and distribution costs. Such a technique (reducing production costs, reducing the cost of goods) is ideally the basis of a long-term development strategy for any company.
Non-price methods of competition in standing tense are fundamental in the market mechanism of all developed countries of the world. Their essence is to improve the quality of manufactured goods, improved after-sales, pre-sales service. This means that in competition, special attention is paid to:

1. high quality of goods (services);
2. reliability of goods, their safety. This is what the advertising focuses on.
3. cost-effectiveness of goods (the consumer analyzes how much to pay for electricity, water, energy when using goods);
4. ease of use and maintenance;
5. longer warranty period for the use of goods;
6. Better environmental performance;
7. high quality pre-sales and after-sales service;
8. the condition of mandatory (often free-of-charge training of personnel to work on the purchased equipment);
9. the condition of accepting the returned old equipment as a first installment for a new product;
10. The norm of competitive struggle in modern conditions is the supply of equipment not on a turnkey basis, but on the principle of "first production - in hand", which attracts customers by saving costs for commissioning;
11. Increasing speed of fulfillment of customer orders at constant prices. The principle prevails: "Speed ​​is a factor of civilized competition!".

Of great importance in non-price competition is the prompt readiness of firms to re-profile the production of their products, depending on changes in the market situation. Thus, in Japanese firms it has become a rule to train workers in several specialties at once. If there is a need to re-profiling production, therefore, a change of personnel is not required and the time of the re-profiling itself is saved. This technique is especially characteristic of the behavior of small firms, which explains their high vitality and flexibility.
It is possible to achieve temporary advantages over competitors not only on the basis of real differences in your product, but also through active promotional activities.

Criticism of advertising. Advertising critics argue that:
1. Its main goal is to manipulate people's tastes. Most of advertising is more psychological than informative. Consider, for example, a television advertisement for a brand of soft drink. It most likely does not contain information about either the price of the drink or its quality. The commercial shows us a group of happy young people at a picnic with cans of drink in their hands. The purpose of the advertisement is to convey a subconscious (if not telepathic) message to the viewer: "You can have many friends and be just as happy if you buy our drink!" Critics argue that such advertising is aimed at initiating a desire that simply would not have otherwise arisen.
2. The cost of advertising is relatively unproductive, adding little or nothing to the prosperity of society. Although the advertising activity itself creates additional jobs (advertising agencies, media, etc.), however, with an alternative use of advertising media, they could bring a greater social effect.
3. Advertising sometimes causes negative externalities such as increased consumption of tobacco products, alcohol, etc.
4. The effectiveness of advertising is low, since most of it tends to self-neutralize. For example, an active advertising campaign of Sanino and Colgate pastes leads to the fact that the consumer does not know what choice to make, and therefore is guided by other criteria when determining a purchase.
5. Critics also argue that advertising stifles competition. Advertisers are trying to convince consumers that the products offered are much more more different from each other than they really are. By sharpening the perception of product distinctiveness and fostering brand loyalty, advertising makes consumers immune to price differences among similar products. With a less elastic demand curve, each firm earns a larger premium over marginal cost.

Advertising protection. Advertisers point out that:
1. Its main goal is to provide consumers with information about the product. Advertising informs about the prices of goods, about the appearance new products and about the location outlets. Information allows consumers to consciously choose the product they need; thus, the efficiency of the market allocation of resources is increased.
2. It helps to increase the intensity of competition. Since advertising informs consumers about all the firms operating in the market, buyers are able to benefit from the difference in prices. Thus, the power of firms over the market is reduced. In addition, advertising makes it easier for new firms to enter the market, because it attracts consumers who are dissatisfied with existing products.
3. Funds for advertising placement - this is almost the most main source media income. Neither television, nor radio, nor newspapers could exist if they did not provide paid advertising services. This external effect on viewers and readers justifies some of the inconvenience associated with the advertising glut of the media.
4. Advertising encourages the advertiser to improve the product. The advertising campaign will be doomed to failure if the product does not have at least some of the features that are mentioned in the advertisement.
5. Advertising stimulates high level consumer spending, which creates positive prerequisites for economic growth, increased employment and, in the end, an increase in the general well-being of the nation. A well-known adage says: "If advertising does its job effectively, then many people keep theirs."

Over time, politicians have come to the conclusion that advertising does increase the level of competition. Take, for example, state regulation of the activities of representatives of such professional groups as lawyers, doctors and pharmacists. In the past, their organizations have gone to great lengths to persuade state governments to ban advertising in these areas on the grounds that it is unethical.
In recent years, however, it has been argued that the main effect of the advertising ban is to limit competition; many laws that prohibited consumer information about professional services were repealed.

Summing up, it should be noted that in modern economic conditions it is non-price methods of competition, such as: modification of product properties; creation of goods - substitutes, i.e. interchangeable goods; improvement of services accompanying the sale of goods, etc., are the main guarantors of the growth of the competitiveness of commodity producers. This provision is of particular importance for Ukrainian firms in the light of the prospects for integration into the structures of the world market.
Unfair methods of competition to some extent coexist with price and non-price methods, but they are subject to both public condemnation and criminal prosecution. The named methods include:
1. industrial espionage;
2. industrial counterintelligence;
3. counterfeit products of competitors;
4. trademark theft;
5. direct deception of consumers;
6. luring specialists from competing firms with higher salaries;
7. bribery of officials (corruption);
8. fraud with the company's reporting in order to hide profits from taxation (in this case, you can reduce prices and be more competitive).

In the conditions of transition to the market, during the period of initial accumulation of capital, many of the entrepreneurs use precisely these methods. This practice can only be resisted by the formation of the legal field of entrepreneurial activity, the improvement of legislation. The education of civilized methods of competition is a multifaceted problem that requires great attention from the state.
Without competition, market relations are theoretically unthinkable, but practically impossible. In competition, as in any other significant public phenomenon, good and evil, pluses and minuses are combined.

Competition in translation from Latin means "to collide" and, as noted above, means the struggle between producers for the most favorable conditions for the production and marketing of products. Competition plays the role of a regulator of the pace and volume of production, while prompting the manufacturer to introduce scientific and technological achievements, increase labor productivity, improve technology, work organization, etc.

Competition is a determining factor in price regulation, a stimulus for innovation processes (introduction of innovations into production: new ideas, inventions). It contributes to the displacement of inefficient enterprises from production, rational use resources, prevents the dictate of producers (monopolists) in relation to the consumer.

Competition can be conditionally divided into fair competition and unfair competition.

fair competition

The main methods are:

  • - improving product quality
  • - price reduction ("price war")
  • - advertising
  • - development of pre- and after-sales service
  • - creation of new goods and services using the achievements of scientific and technological revolution, etc.

One of the traditional forms of competition is price manipulation, the so-called. price war. It is carried out in many ways: by lowering prices, local price changes, seasonal sales, providing more services at current prices, extending the terms of consumer credit, etc. Basically, price competition is used to push weaker competitors out of the market or penetrate an already developed market.

A more effective and more modern form of competition is the struggle for the quality of the goods offered to the market. The entry into the market of higher quality products or new use value makes it more difficult for a competitor to respond. The "formation" of quality goes through a long cycle, starting with the accumulation of economic, scientific and technical information. As an example, we can cite the fact that the well-known Japanese company "SONY" carried out the development of a video recorder simultaneously in 10 competing directions.

At present, various kinds of marketing research have received a lot of development, the purpose of which is to study the needs of the consumer, his attitude to certain goods, because. knowledge of this kind of information by the manufacturer allows him to more accurately represent future buyers of his products, more accurately represent and predict the situation on the market as a result of his actions, reduce the risk of failure, etc.

An important role is played by pre- and after-sales customer service, as the constant presence of manufacturers in the consumer service sector is necessary. Pre-sales service includes meeting the requirements of consumers in terms of supply: reduction, regularity, rhythm of deliveries (for example, components and assemblies). After-sales service - the creation of various service centers for servicing purchased products, including the provision of spare parts, repairs, etc.

Due to the great influence on the public of the media, the press advertising is the most important method of conducting competition, because. with the help of advertising, it is possible in a certain way to form the opinion of consumers about a particular product, both for the better and for the worse, the following example can be cited as evidence:

During the existence of the FRG, French beer was in great demand among West German consumers. West German producers did everything to prevent French beer from entering the German domestic market. Neither the advertising of German beer, nor the patriotic appeals "Germans, drink German beer", nor the manipulation of prices led to anything. Then the German press began to emphasize that French beer contains various chemicals that are harmful to health, while German beer is allegedly an exceptionally pure product. Various actions began in the press, arbitration courts, medical examinations. As a result of all this, the demand for French beer still fell - just in case, the Germans stopped buying French beer.

But along with the methods of fair competition, there are other, less legal methods of competition:

Unfair competition

The main methods are:

  • - economic (industrial espionage)
  • - fake products of competitors
  • - bribery and blackmail
  • - cheating consumers
  • - fraud with business reporting
  • - currency fraud
  • - concealment of defects, etc.

To this we can also add scientific and technical espionage, because. any scientific and technical development is only a source of profit when it finds application in practice, i.e. when scientific and technical ideas are embodied in production in the form of specific goods or new technologies.

Patent as an incentive for industrial espionage

It was industrial espionage, so to speak, that "created" a patent for an invention. Since it was not possible to keep production secrets, an inventor who spent years of labor might not receive any reward for his invention, because. the result of the invention was often used by completely outsiders who had nothing to do with the invention. The patent was supposed to prevent such an injustice.

A patent is a document that certifies an invention and secures the exclusive right to the patent holder to use the results of his invention. If a patent is used without the permission of the owner, he can recover damages through the court or stop the illegal use of his invention. In addition, he may grant a license to others to use the patented invention.

But the patent, theoretically directed against industrial espionage, was practically a kind of incentive for this phenomenon. One of the first invention patent laws was issued in France at the end of the 18th century, which stated that anyone who was the first to bring a foreign invention to France would be accorded the same benefits as its inventor would have enjoyed. Thus, industrial spy rights are recognized equal rights inventor.

Deception and provocations in small and medium-sized businesses Aleksey Anatolievich Gladkiy

Dirty methods of competition

Unfair competition as a method of competition has a long history, and in modern Russia this phenomenon is developing quite successfully, everywhere and rapidly.

The essence of unfair competition lies in the fact that by all possible (legal and illegal) means to strengthen their own positions by weakening the positions of a competitor or by eliminating him. Currently, the most common unfair competition involves the use of the following methods:

Economic and industrial espionage;

Compromising a competitor in all possible ways (in the media, before tax authorities and etc.);

Falsification and counterfeiting of competitor's products;

Direct material damage;

Psychological suppression.

Economic and industrial espionage is aimed at secretly eliciting from a competitor the secrets of successful management, production secrets, and other corporate secrets. One of the most common methods of such espionage is when a resident is introduced into a competitor's company, who, having gained confidence in the employees and management of the enterprise and having access to secret information, transfers all the information received to his management.

Of course, no one has canceled various kinds of "bugs" installed in the office and other premises of a competitor, bribing telephone exchange workers in order to obtain printouts of telephone conversations, etc. However, at present, espionage can be carried out in a more "advanced" way - with the help of special software. Spyware is embedded on the computers of employees of a competing enterprise and transmits the information received "to the center". Keyloggers (keyloggers) are considered the most dangerous "virtual spies" from a business point of view.

A keylogger is a program or device that constantly monitors all keystrokes on the keyboard (and in many cases, all mouse clicks) in order to obtain information about all texts typed by the user. Why is this needed? Most often, in this way you can get business email correspondence of a competitor, and if he is engaged in software development, then also the source codes of the programs being developed.

A characteristic feature of keyloggers is that they can act not only as malicious software embedded in a computer, but also as separate devices. Such devices are usually installed between the keyboard and the system unit and, since they are very small, can go unnoticed for a long time. However, to install such a device, you need access to a computer in the absence of a user. In order to detect such a “surprise” in a timely manner, it is recommended to pay attention more often to whether a new device has appeared between the keyboard and the system unit.

Keyloggers can be introduced different ways: using e-mail, by unauthorized access to a computer; sometimes, in order to “get” a keylogger into your computer, it is enough to go to a certain site.

The spread of false information and false advertising is one of the most unpleasant types of unfair competition, which can be compared to a "hit below the belt." The essence of the method lies in the fact that deliberately false and unreliable information is spread about a competitor and its products. For example, among potential consumers of a competitor's products, rumors can be spread that the product is allegedly manufactured in violation of existing standards, and the manufacturing plant will soon close altogether, and there will be no one to file claims for non-conformity. Among the business partners of a competitor, you can spread information about his unreliability: they say, “do not supply them with raw materials and materials - they may not pay for them”, “do not rent them a room to expand production - they have problems with the tax, even before you get there”, etc. A skillfully staged “anti-advertising” campaign can significantly reduce the success of a competitor enterprise.

Somewhat similar to this method is another method of unfair competition, which consists in the maximum possible compromise of a competitor by all accessible ways. And here we can talk not only about the enterprise itself and its products, but also about the founders and officials, which is no less serious. For example, the publication in the press of a custom article about the alleged uncleanliness of the director of an enterprise, his connection with criminal circles and existing problems with the law can discourage many potential partners from dealing with such an enterprise. Another custom article that talks about the "terrible" quality of a competitor's products can seriously harm its sales plans, and therefore bring considerable unplanned losses.

More specifically? Here is an example that recently took place in the Vologda region. The enterprise specializing in the production of baby food occupied a leading position in the market, which was not liked by everyone, in particular, there were competitors who wanted to press the leader against. Once, an article appeared in one of the local newspapers that crushed glass was found in jars of baby food from this manufacturer. Moreover, the article was submitted cunningly: it did not name specific facts (since there were none), but it was said that “according to unverified data, crushed glass was found in jars of baby food from manufacturer X.” There is no fact of slander in this article, since it is clearly stated - “according to unverified data”, but what kind of mother, after reading such information, will buy baby food from this manufacturer for her child! The effect was stunning and, perhaps, exceeded all the expectations of the intruders: the leading enterprise was not only “thrown off Olympus”, but it even had to change its sign, i.e. change the name of the manufacturer, as well as the “promoted” trademark.

True, the affected businessmen did not remain in debt and answered with dignity (fortunately, there were connections in the tax and law enforcement agencies): a tax audit came to unscrupulous competitors (intruders were identified through their own channels) and found such violations that the case was then transferred to the department for combating economic crimes and, in parallel, to the tax police. The accounts and warehouses of the “guilty” company were seized, and nothing has been heard about it since.

Another popular manifestation of unfair competition is the falsification and counterfeiting of a competitor's products. Here, attackers can pursue two goals: making a profit at the expense of a "promoted" brand (in this case, they still somehow care about quality) or deliberately discrediting a competitor's products. In the latter case, under the brand of a competitor's product, a disgusting fake is sold that has nothing to do with the original, except for the packaging.

In both the first and second cases, unscrupulous competitors can be prosecuted at least for using someone else's trademark for personal gain. However, attackers may well achieve their goal: the trademark under which low-quality products are sold will be rejected by a significant part of buyers, if not the majority.

Direct infliction of material damage is one of the most rude and dirty methods of competitive struggle. In this case, the attackers in one way or another seek to destroy or damage the competitor’s property and other inventory items, disable production equipment, etc. One of the most common ways of causing material damage is deliberate arson: such an act is difficult to prove, and the damage you can apply a very, very decent one - up to the complete destruction of buildings, structures, warehouse stocks, production equipment, business documentation, office equipment, etc.

It should be noted that malefactors can cause material damage not only to the enterprise, but also to its founders and officials. At present, no one is surprised by the facts of burning cars, cottages and summer cottages, damage to personal property, etc.

One of powerful tools unfair competition is a psychological suppression. Threats, blackmail, incomprehensible hints on the phone, etc. can be used as "methods of influence". Moreover, not only the founders and responsible persons of the company, but also their close people can be subjected to it. For example: the director of a successful company receives e-mails with threats and demands to “slow down” and “let other good people work”, at the same time, his wife is harassed and harassed at work by the authorities, and the child is being bullied at school classmates. Not every person is able to withstand such pressure, and even more so - to adequately resist it!

Sometimes it’s not the founder or the responsible person of the company who may initially be intimidated, but his close people - his wife, children, parents ... For example, a wife can tell that some people constantly call and threaten her, a child may complain that he was met after school an unfamiliar uncle and asked for a long time about dad, etc.

According to many psychologists, the more incomprehensible the psychological impact is for the victim, the greater the effect it can bring. For example, if a person simply calls on the phone and says something like “do not bother others, otherwise you will have problems” - this is not the worst option: at least you can contact the police or complain to your own security, and some such threats can simply ignore. Psychologically, it is much more difficult to endure obscure hints and circumstances, for example:

Calling by phone without presenting specific requirements and threats, but only with incomprehensible words, like: “well, well, I jumped”, “all good things come to an end”, etc. (by analogy with the famous “Load oranges in barrels brothers Karamazov” from “The Golden Calf”);

After passing on the street past an unpleasant company of a dubious-looking young people, their friendly malicious laughter is heard behind their backs or a phrase is heard, like: “we are all mortals”, “here another one has gone”, etc.;

Under the “janitor” of the car, notes are found with incomprehensible content or even drawings (like a pirate “black mark”), and not written by hand, but printed on a printer (modern attackers are careful);

Direct and open threats from competitors to bring a tax audit, a department for combating economic crimes, etc., to a successful enterprise (it is no secret that modern Russian legislation allows even a baby to be held accountable if desired);

Constant calls to the door of the apartment with the disappearance of the caller (when the door is opened, there is no one in the corridor);

other similar actions.

As Russian practice shows, psychological methods of influence are often the most effective. For example, if someone’s car or dacha was burned down, or a tax audit was “set” on the company, or the products and trademark were discredited, the reaction can be directly proportional: a person can become hardened and take effective response actions. But if a man comes home, and his wife tells him that they threatened to throw acid in her face, and a frightened and tearful son, having come from school, reports that some uncle threatened to kill him if dad does not listen to "good people" - here any reasonable person would step on the throat own song, forget about all ambitions and do what was required of him. Moreover, if in the event of material damage a person can turn, for example, to the police, then in the event of a threat to the life and health of loved ones, many are simply afraid to contact law enforcement agencies.

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A method is a way to achieve some goal. There are price and non-price methods of competition.

At price competition the fight is based on price. Its beginning dates back to the time of free competition, when even homogeneous goods could be sold at a variety of prices.

In price competition, the entrepreneur seeks to sell goods at lower prices than his rival. Price competition leads to the emergence of price wars, during which there is a gradual reduction in prices. A price war is based on a decrease in demand for goods, resulting in an excess supply. A price war is beneficial for buyers because they can buy a good at a lower price. Producers, on the contrary, may lose part of their profits, or even go bankrupt, due to lower prices. The price is the bait that allows you to attract the attention of the buyer and enables the seller, ultimately, to win certain positions in the market.

In modern conditions, when the markets are divided among a small number of large firms, and the cost of these enterprises is very high, large producers strive to keep prices at the achieved level as long as possible. These large (oligopolistic) firms are afraid to enter into an open price struggle with each other, as it can lead to the defeat of all competitors. There may or may not be winners.

This, of course, does not mean that the "price war" does not apply in the modern market. It exists, but not always in an explicit, open form. Today, the price war is being waged in the following forms.

· An open price war still takes place today, but it occurs only when a given firm has a significant reserve for reducing the costs of production of a product compared to its rival. For a rival, in response to a price reduction by his competitor, will also reduce the price of his product. Price competition depletes the financial reserves of any firm and leads to a decrease in investment in renewal and expansion of production, which can ultimately lead to ruin and bankruptcy.

Today, open price competition is used mainly by outsider firms in their struggle with large corporations, since they do not have the strength and capacity to compete with these corporations in the field of non-price competition.

Further, price methods of competition are also used to penetrate the market with new products. This is not neglected by large corporations where they do not have absolute advantages, as well as in the case when the problem of sales suddenly becomes aggravated.

Hidden price competition is often used nowadays.

■ In this case, the company launches a new product on the market with significantly improved consumer properties. But the price of this commodity rises disproportionately little. Thus, in 1976 the American company Cray Research produced a computer with a capacity of 100 million operations per second at a price of $8.5 million. In 1982, the same company produced a computer with a capacity three times higher, and the price was increased only 15%.

■ Such a method of price competition as price discrimination is also widely used.

It means selling the same product to different buyers at different prices. For example, it is practiced to set utility tariffs for institutions and organizations at lower rates than for individual consumers.

Price discrimination is carried out by firms with monopoly power. Monopolies maximize profits through price discrimination. Discriminatory prices can be used to expand production. Thus, the firm obtains economies of scale.

Today, in the conditions of scientific and technological revolution, price competition has been replaced by non-price methods, since the winner is the one who offers higher quality, as well as a wider range of products. In this regard, non-price competition methods are divided into two groups:

product competition and

· Competition on terms of sales.

Product competition is associated with the desire to capture a part of the competitor's market by releasing products of a new range and quality while maintaining approximately the same price. In the USA, for example, 10,000 varieties of flour, more than 4,000 varieties of canned corn, and 50 varieties of mustard are sold simultaneously.

Competition on terms of sale consists in the use of numerous means to attract buyers to goods. It includes advertising, after-sales service, loyalty discounts, etc.

Special methods of non-price competition are sales of goods on credit (in installments) and leasing. Leasing is a long-term lease of machinery, equipment, vehicles, industrial facilities, providing for the possibility of their subsequent redemption by the tenant. In contrast to the classical lease, the relationship between the parties in leasing is based on the terms of the contract of sale.

All of the listed methods of competition can be attributed to fair (fair) competition. These methods are associated with improving the quality of the product, reducing the cost of its production, which ultimately leads to a win for the consumer.

However, there is unfair (illegal) competition. It enhances the position of the firm, often by violating laws, regulations business communication. Methods of unfair competition include:

p restriction of access to economic resources;

p setting dumping prices;

p violation of contract terms, established standards, etc.

p release of counterfeit goods, which outwardly do not differ from the originals, but have worse qualities and usually cost much cheaper (up to 50%);

p purchases of samples of goods for the purpose of copying them; similar imitating firms are located in Morocco, Hong Kong, Taiwan, Turkey, South Korea, Japan, Mexico, Brazil and several other countries.

p enticement of specialists with industrial and financial secrets;

p industrial and economic espionage;

p the use of aggressive actions: defamation of the product, refusal to provide materials and credit, poaching key personnel and other illegal methods.

More on the topic of Competitive Struggle:

  1. 6.5. CORRELATION AND RELATIONSHIP OF CRIMINALISTICS METHODS AND PRACTICAL ACTIVITY METHODS IN FIGHTING CRIME
  2. 3. Supply of a perfectly competitive firm and industry. Efficiency of competitive markets
  3. The main trends in the development of competitive relations in the Russian banking services market: problems and prospects for the formation of a competitive environment
  4. Stage nine and ten. Implementation of a competitive strategy and assessment of the achieved competitive advantages.
  5. 10. Monetary reforms and anti-inflationary policy as methods of fighting inflation.
  6. 11.4.1 Tariff methods of regulation of international trade Tariff as a means of combating dumping.

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3.1.1. The concept and functions of competition

The key role of competition in market economy was shown in the eighteenth century by Adam Smith in his Inquiry into the Nature and Cause of Nations. The novelty of A. Smith's theory of competition is as follows:

  • for the first time, the concept of competition was formulated as rivalry that raises prices (with a reduction in supply) and reduces them (with an excess of supply);
  • the main principle of competition is defined - the principle of "invisible hand", according to which the "hand" displaces firms engaged in the production of products unnecessary for the market;
  • a flexible competition mechanism has been developed that instantly responds to any changes in the situation during external environment;
  • the main conditions for effective competition are determined: a large number of sellers, comprehensive information, the impossibility of each seller to exert a significant influence on changes in the market price of goods.

Thus, the main “miracle of the market economy” is that it allows people to act guided by personal gain, but at the same time forces everyone to do what is beneficial for society, that is, human behavior, as A. Smith wrote, is determined by the rule “ invisible hand”, by which he understood the mechanism of the market.

Despite the fact that A. Smith's work was published in the 18th century, at the present time there is no single definition of the concept of "towards competition".

The following definitions of competition exist:

  • competition- this is a process by which people receive and transfer knowledge (F. Hayek), (too narrow definition);
  • competition- this is the desire to satisfy the criteria for access to rare goods as best as possible (P. Heine), (too general definition, since it does not include the seller, the buyer and the product itself);
  • competition- this is the presence in the market of a large number of buyers and sellers, the possibility of free entry into the market and exit from it (C.R. McConnell and S.L. Brew), (a broader definition, although it does not take into account the conditions for entering and entering the market) ;
  • competition- a dynamic and evolving process, which results in new products, new ways of marketing, new production processes and new market segments. (M. Poter), (limited definition, since it does not explain what the competition process itself is, but characterizes only its result);
  • competition- this is a rivalry in any field between separate legal entities and individuals interested in achieving the same specific goal (G.L. Alozoev), (there is no concept of a product in the definition);
  • market competition- this is the struggle of firms for a limited amount of effective demand of consumers, conducted by them in accessible market segments (A.Yu. Yudanov).
  • competition- this is the competitiveness of economic entities, when their independent actions effectively limit the ability of each of them to unilaterally influence the general conditions for the circulation of goods on the corresponding commodity market(Law of the Russian Federation “On Competition and Restriction of Monopolistic Activities in Commodity Markets);
  • competition- this is an economic commitment to achieve the best results in the field of any activity, the struggle of commodity producers for more favorable business conditions, obtaining the highest profit.

Despite the fact that there is no single concept of “competition” in the world, all economists agree that competition is driving force development of society, the main tool for saving resources, improving the quality of goods and the standard of living of the population, as well as the main incentive for adapting to changes, that is, for introducing changes, improving the structure of the enterprise.

Competition has the following defining features:

  1. is a backbone component of market relations, determining the totality of their inherent elements (production costs, price formation, adaptability of enterprises and organizations to market requirements, satisfaction of demand for goods and services, etc.);
  2. serves as the foundation of market methods of managing the economy, the basis for the formation and manifestation of the competitiveness of products, the economic law expressing the objectivity of the categories of competition (competitiveness) between market entities, affects the nature and forms of relationships between them;
  3. manifests itself in the system of reproduction of technical and economic parameters of products at all stages of its design, manufacture, pre-sales and after-sales service and consumption (operation).

Positive features of competition are that:

  • it contributes to scientific and technological progress, rational use of resources;
  • helps manufacturers to respond responsively to changes in demand and make adjustments to production;
  • helps to reduce production costs, and hence prices;
  • creates favorable conditions for the manifestation of initiative, stimulates entrepreneurship.

Negative features of competition you can call it:

  • competition leads to an increase in income differentiation, creates social tension;
  • causes instability of business and leads to the ruin of a number of entrepreneurs;
  • causes crises in the markets.

Competition in a market economy performs a number of functions. Competition features:

  • regulating- affects the supply of goods and services so that it meets the needs of consumers;
  • allocation- ensures the concentration of resources where they will have the maximum return;
  • innovative- forces all firms to focus on increasing labor productivity in order to increase efficiency and achieve the optimum of the firm;
  • motivating – provides firms with positive and negative sanctions, that is, enterprises that offer better quality products or produce them at lower costs are rewarded in the form of profits, and enterprises that do not respond to the wishes of customers or violate the rules of competition receive losses and are forced out of the market ;
  • distribution, insofar as competition not only includes incentives for more high efficiency, but also allows to distribute income among enterprises and households in accordance with their effective contribution, that is, with the principle of remuneration according to results;
  • controlling- contributes to the fact that no single supplier and buyer can take a dominant position in the market.

3.1.2. Mechanism of competition

Competition- this is a form of interaction between market entities, a mechanism for regulating market proportions, a set of methods, an economic process.

As a form of interaction between market entities, competition is a multifaceted process, which is accompanied by rivalry for increasing production volumes, expanding sales markets, and for sources of raw materials and materials.

Acting as a mechanism for regulating proportions, competition makes it possible to determine the magnitude of economic regulators, which are prices, the rate of profit, the rate of interest on capital, and a number of others.

The starting point in the study of competition is the study of the content of its mechanism.

The mechanism of competition in the modern market is deeply disclosed by a professor at Harvard Business School, Michael Porter.

The extended concept of rivalry introduced by Porter proceeds from the fact that the ability of an organization to realize its competitive advantage in underlying market depends not only on the direct competition that it faces, but also on the role played by various competitive forces, so the essence of competition, in his opinion, is expressed by five forces:

  1. The threat of new competitors.
  2. The threat of substitute products, or the threat of substitution of products and services.
  3. Supplier rivalry, or the ability of component suppliers to bargain.
  4. The rivalry of buyers, that is, the ability of buyers to bargain.
  5. The rivalry of existing competitors among themselves, that is, the struggle between existing competitors.

Together, these forces determine the inherent attractiveness of the long-term profits that can be made in the commodity market. It is the interaction of these five forces that ultimately determines the profitability potential of the product (service) market.

3.1.3. Types and methods of competition

For an in-depth study of the category of competition, its detailed detailed classification is necessary. The classification of competition is necessary in order to identify it. specific features and accept adequate measures to compete and win.

Can be distinguished intra-industry and intersectoral competition.

Intra-industry competition- this is the rivalry between producers of one type of goods for the most favorable conditions for production and marketing, for a large share of the market for this product,

Interindustry competition- this is a struggle between manufacturers in different industries for the most profitable areas for capital investment. As a result of intersectoral competition, funds from low-profit industries rush to highly profitable sectors of the economy.

Competition may be due to natural factors, and geographic.

Competition driven by natural advantages, can be caused, for example, by the presence of oil at shallow depths, or by the presence of a high iron content in the ore.

Competition driven by geographic advantage, for example, the presence of lower costs for the transportation of products, etc.

Moreover, competition is subject, subjective, functional, specific, direct, expected.

Functional competition arises due to the fact that different goods or services can satisfy the same need in different ways, for example, the necessary transportation can be carried out by road or rail.

Species competition arises in those cases when goods designed to satisfy the same need differ from each other in their properties that affect the degree of such satisfaction.

Subject competition manifests itself in the case when enterprises offer customers almost the same goods, for example, cars of the same class.

Subjective competition arises between firms whose stable position in the market is ensured by the chosen field of activity.

Expected Competition begins already at the stage of development or mastering the production of new products that will be supplied to already mastered or new market.

Direct competition arises in the case of competitive relations without intermediaries.

It is also customary to single out internal and external, regional and interregional, bona fide and unfair, price and non-price, perfect and imperfect competition .

In addition, competition can be classified according to:

  • objects of competition
  • subjects of competition
  • degree of civilization
  • functioning
  • degree of openness
  • market conditions
  • nature of competition
  • the number of participants;
  • competitive situation.

;

To price methodscompetition relate:

  • price reduction by reducing production costs, while the quality and range of goods and services offered remains unchanged;
  • price discrimination, that is, the sale of goods at demand prices (first degree), the use of a discount system (second degree) and consumer segmentation (third degree).

Price methods of competition are widely used in the oligopolistic market. However, in addition to price discrimination, widely used in modern period, monopolistic competition brings to the fore the methods of non-price competition.

To the main methods of non-price competition relate:

  • release of goods of higher quality or goods with qualitatively new properties;
  • creation of fundamentally new products;
  • improvement of services and after-sales service;
  • the formation of new needs and the development of products to meet them.

A special place among the methods of competitive struggle is occupied by methods and means of unfair competition, which include:

  • unauthorized use of someone else's trademark;
  • acquisition of a competitor's trade secret;
  • dissemination of information about a competitor that could harm its reputation;
  • incorrect comparison of own goods with the goods of a competitor in advertising, misleading consumers regarding the quality of goods and their properties.

Along with the methods of unfair competition, there are methods prohibited by antitrust laws (for example, the Sherman laws of 1890, Clayton of 1914 and Robinson-Patman of 1936), the so-called methods of monopolistic competition.

To methods of monopolistic competition relate:

  • imposing on buyers a compulsory assortment of purchased goods and services (“load trading”);
  • prior agreement between companies to raise or lower prices;
  • preliminary conspiracy between producers to reduce the volume of production;
  • establishing discriminatory business conditions for clients and partners.

Unfortunately, the methods of monopolistic and unfair competition have been widely used and are being used today. The state must strictly suppress attempts to use such methods of competition. Without this, the formation and development of full-fledged processes of competition in the economy of the country is impossible.

3.1.4. Strategy and competitive factors

The main element of the business strategy is innovation. All other elements of the strategy depend on it: any of them has a chance of significant and long-term success only insofar as it relies on the use of product innovations already “approved” by the market. The logic leads to the fact that it is legitimate to consider the innovation strategy as a reference for the whole range of problems solved by commodity producers. Competition is main factor susceptibility of the enterprise to product and technical innovations.

Competition in the innovation sphere has the following features:

  • it contributes to the fact that entrepreneurs are trying to master products of higher quality at market prices in order to retain consumers;
  • stimulates the use of the most efficient methods of production;
  • forces the entrepreneur to constantly look for and find new types of products and services that consumers need and can satisfy the needs of the market.

Analysis of the distant environment of producers should be supplemented by a study of the near environment, that is, the organization's competitors. Quantitative and qualitative data are used to analyze nearby competitors.

quantitative data- this is information about which firms are competitors; what products they sell; how and in what markets; who are their main customers; how goods are brought to market.

Qualitative characteristics are the fame of the enterprise, the qualifications of its personnel, the quality of goods, the commitment of consumers to the brand of the enterprise, the management system, the strategy of activity in the market and other non-formalized parameters, which are quite difficult to assess. Such information will always be subjective. In practice, the activities of competitors are analyzed in the same areas as the company's own activities.

Sources of information can be very different: statistical data; price lists; mass media; catalogs, brochures, promotional materials; annual reports of firms, opinions of experts and buyers, up to industrial espionage. This takes into account other important factors presented in Fig. one.

Rice. 1. Factors serving the actions of competitors

Assessment of the conditions of competition is the definition of factors affecting competition and their study. A market-oriented organization, according to M. Porter's broad concept of rivalry, must take into account all the factors of competition operating in the market.

To the most important competitive factors relate:

  • number of firms and their sizes;
  • product specifics;
  • the nature of demand and prospects for the development of the industry;
  • costs associated with switching consumers from one supplier to another;
  • existence of barriers to exit from the industry;
  • rivalry between competing companies;
  • competition from substitute goods;
  • the threat of new competitors;
  • economic opportunities for suppliers and buyers, etc.

It is necessary to determine the rules of competition in the industry, evaluate intra-industry competition at the current time and in the future.

Competition encourages entrepreneurs to act effectively in the market, forcing them to offer a wider range of goods and services at lower prices and better quality, actively introduce innovations, improve technologies, rationally use limited resources, improve investment efficiency.

3.1.5. Types of competitive behavior of the firm

The goal of any organization is to win the competition. Each firm chooses its own type of competitive behavior. There are three main types of competitive behavior of the firm.

The first type is creative type of competitive behavior, aimed at creating product, technological, organizational and managerial innovations that provide superiority over competitors.

The second type is guaranteeing. This is a type of competitive behavior based on the desire to maintain the previously achieved positions for the long term through non-price methods of competition.

The third type of competitive behavior is opportunistic. It is associated with a faster take into account changes in production and in the market situation and with the desire to get ahead of their competitors in adapting to new market conditions.

The most preferable for an active business is the first type of competitive behavior; moreover, it is necessary for the successful implementation of the company's innovative strategy.

3.1.6. Competitiveness and methods for assessing the competitive situation

Methods for assessing the competitive situation include assessment of competitiveness and assessment of competitive advantages .

In this regard, the concept of competitiveness should first be defined. To date, there is no generally accepted concept of competitiveness.

According to the "Dictionary of the Russian language" S.I. Ozhegov " Competitiveness is the ability to withstand competition, to resist competitors. Taking this definition as a concept of the Russian language as a basis, we can say that competitiveness is a complex multidimensional concept, meaning the ability of a product and, accordingly, a commodity producer to take and maintain a position on competitive market(markets) during the period under review in competition with other goods of a similar purpose and their producers. In the modern market, competitiveness is the ability to get ahead of others, using your advantages in achieving your goals.

In the economic literature, the concept of competitiveness has different interpretations, is analyzed in different ways, in particular, depending on which economic object it is applied to.

When assessing the competitive environment in a particular market, it is necessary to distinguish competitiveness of goods and enterprises. The competitiveness of products and the competitiveness of the enterprise are related to each other as a part and a whole.

The ability of a manufacturer to compete in a particular product market directly depends on the competitiveness of the product and the aggregate economic methods enterprise activities. The competitiveness of a product does not have a clear quantitative definition, all its factors are relative.

There are a large number of definitions and methods of evaluation product competitiveness.

Usually, they understand everything that provides it with advantages in the market, contributes to successful sales in a competitive environment.

Product competitiveness- this is a relative and generalized characteristic of a product, expressing its advantageous differences from a competitor product in terms of the degree of satisfaction of a need and the cost of its manufacture. According to the scientist I.M Lifits, product competitiveness- the ability of the product to ensure commercial success in a competitive environment. However, such definitions do not clarify the content of this concept, stating the already obvious dependence of sales on competition.

Sometimes under product competitiveness only a complex of consumer properties, separated from value, is understood. Thus, the term "competitiveness" is identified with the concept of product quality, in the broad sense of the word. And although now the basis of competition has become non-price competition, or quality competition, this does not mean that you can not take into account the price of a product when assessing its competitiveness. In this regard, Russian scientists E.A., Utkin, N.I. Morozov and G.I. Morozov under product competitiveness is understood a set of its quality and cost characteristics, which ensures the satisfaction of the specific needs of buyers and favorably differs from competing goods for the buyer.

Under product competitiveness is understood as a characteristic that reflects its difference from a competitor product both in terms of the degree of compliance with a specific social need, and in terms of the costs of satisfying it. Thus, under product competitiveness it is necessary to understand the complex of consumer, price and quality characteristics of the product that determine its success both in the domestic and foreign markets.

When assessing the competitiveness of a product, the main factor is the sources competitive advantage.

Competitive advantage can be associated with almost any aspect of the company's activities: a special pricing policy, effective management of sales, profits, capital, costs, profitability of production and other financial results, with the nature of innovation. Thus, competitive advantages are: low costs, high quality and a strong degree of differentiation.

In a market economy, an enterprise cannot occupy a stable position for a long time if its strategy is aimed only at the competitiveness of the product. When entering a new market, when deciding to expand and curtail production, when making investments, it is required assessment of the competitiveness of the enterprise itself.

Enterprise competitiveness indicator is a mirror that reflects the results of the work of almost all its services and divisions, as well as its reaction to changes in external factors of influence. If we consider the concept of "competitiveness" in relation to the enterprise, then it can be defined as the possibility of effective economic activity and its profitable practical implementation in a competitive market.

Enterprise competitiveness - the result of effective management focused on innovative type of development. The competitiveness of an enterprise is the ability to use its strengths and concentrate its efforts in the area of ​​production of goods or services where it can take a leading position in the domestic and foreign markets. At the same time, competitiveness is assessed only within a group of enterprises belonging to the same industry, or firms producing substitute goods.

The competitiveness of the firm can be defined as the ability to provide the best offer of goods, compared with a competing company.

The key concept of the competitiveness of an enterprise is its competitive advantage.

English economists M. Meskon, A. Albert and F. Hedouri consider competitive advantages as the high competence of the organization in any area, which gives it the best opportunity to attract and retain customers.

Professor R.A. Fatkhutdinov believes that competitive advantage of the organization - these are any exclusive values ​​(tangible, intangible, monetary, social, etc.) that an organization possesses and which give it superiority over competitors. According to Fatkhutdinov, the implementation of competitive advantage is based on the essence of value, which was the source of obtaining the advantage.

In the interpretation strategic marketing, which underlies the modern concept of strategic management, the French scientist J. Lambin defines competitive advantages as those characteristics, properties of the product (brand) or other factors that create a certain superiority for the company over its direct competitors. These characteristics can be very different and can relate both to the product itself (basic service), and to additional services accompanying the basic one, to the forms of production.

Competitive advantages, according to the English scientist Richard Koch, these are the characteristics of the properties of a product or brand, as well as the advantages in the management system, which create superiority for the company over competitors.

The founder of the theory of competition M. Porter proposed a classification (hierarchy) competitive advantage in terms of their importance. Low Rank Benefits(available raw materials, cheap work force, the scale of production) give the company insufficient competitiveness, since they are easily accessible to competitors and are widely distributed. To higher order benefits include the firm's reputation, customer relationships, and the firm's investment attractiveness. An important competitive advantage can be the goals and motivation of the owners, managers and staff of the firm. To competitive advantage of the highest order M. Porter refers to the technical level of products, patented production technology and high professionalism of the staff.

Therefore, among internal factors the competitiveness of an innovative firm, the leading role belongs to the technological factor, and the most important source of creating and maintaining a competitive advantage is the constant renewal and innovative development of production.

The competitive advantages of a commodity producer are closely dependent on the strategy chosen by him and the success of its implementation, therefore, more and more attention is paid to the strategy of the enterprise.

The methodology for assessing the conditions of competition has been developed M. Porter and is based on the "national rhombus"(Fig. 2).

Rice. 2. National rhombus. Source: Porter M. International competition - M. 1993. - S. 149.

When assessing the conditions of competition, both the parameters of factors and the parameters of demand should be taken into account. The strategy of organizations, their structure and competition directly depends on these parameters. but, in turn, has a strong influence on them.

The success of enterprises, their competitiveness in the innovative market depend on many factors. A list of indicators reflecting the key success factors in a particular market allows an enterprise to assess its competitiveness relative to its main competitors. It is clear that the main forces that shape the competitive climate can change from market to market. The interaction of these competitive forces builds a model of the attractiveness of the industry and possible changes in it as a result of the action of objective economic factors.

Matrix methodassessment of the competitiveness of an enterprise, developed"Boston consulting group», describe the competitive situation using two main dimensions: the importance of maintaining competitive advantage and the number of potential sources of differentiation that maintain competitive advantage. Differentiation opportunities depend on each specific industry. In order to gain a competitive advantage, each firm must find its own ways to differentiate products.

The Boston Consulting Group Competitive Advantage Matrix distinguishes four types of areas of activity that differ in the number and magnitude of competitive advantages. A matrix is ​​built in a rectangular coordinate system: horizontally, the growth (decrease) in the number of sales is plotted on a linear scale, vertically, the relative share of goods (services) in the market. The most competitive are enterprises that occupy a significant share in a growing market (Fig. 3).

Rice. 3. Assessment of the competitiveness of enterprises (as pictured in the dock)

In the presence of reliable information on sales volumes, the method makes it possible to ensure a high representativeness of the assessment. However, the application of this method does not include an analysis of the causes of what is happening, which complicates the development of management decisions.

Matrix General electric “Market attractiveness – business efficiency » compares named categories, which, from a marketing point of view, are ideal for business evaluation. A successful firm operates in attractive markets, and its business is efficient enough to be successful. If at least one of these factors is missing, you can say goodbye to hope for positive results. To define these two categories, it is necessary to analyze the underlying factors, find a way to evaluate them, and determine the main indicators.

The method based on theory of effective competition, gives an idea of ​​the competitiveness of the enterprise, covering the most important aspects of its economic activity. The method is based on the assessment of four group indicators of competitiveness: the efficiency of production process management, the efficiency of working capital management, the competitiveness of the product - the quality of the product and its price. According to this method, the most competitive will be those enterprises where the best way organized the work of all departments and services. The effectiveness of their activities is influenced by many factors - the resources of the enterprise. Evaluation of the performance of each unit involves assessing the effectiveness of the use of these resources.

To assess the competitiveness of a company, methodological tools called "benchmarking" are increasingly used. Benchmarking - comparative analysis key success factors (business parameters) of the enterprise and its main competitors . In the process of strategic analysis, it is necessary to first identify the key success factors (KSF) of this industry, and then develop measures to master the most important success factors in competition, that is, determine the ongoing innovative mission in order to succeed in the creation and sale of a new product. CFU can be based on different areas of the enterprise: R&D, marketing, production, finance, management, etc. In practice, KFU can take a variety of forms: it can be highly qualified personnel, low production costs, high market share, effective advertising, company image, recognizable brand. Key success factors vary by stage life cycle industries. All these indicators can be assessed by experts, but it is more preferable to use market monitoring data. Those factors by which the company lags behind competitors are its weakness, and by which it is ahead - strength.

The ratings given take into account the opinions of management services specialists. According to the table, you can find out who is the main competitor.

Method of multi-attribute assessments identifies strengths and weaknesses, calculates their performance, numerically displays the magnitude of the competitive advantage. It is a clear example for regularly monitoring changes in competitiveness. The matrix is ​​divided into nine cells, which make up three levels (Fig. 4).

Rice. 4. Market attractiveness and competitive position (in the dock)

The three cells in the upper left corner are occupied by firms with strong competitive positions. The cells going from the lower left corner to the upper right corner belong to firms with an average competitive position. Three cells in the lower right corner are occupied by non-competitive firms. The area of ​​the circle is proportional to the size of the market share, and the results are represented by arrows of a certain length and direction.

The advantage of this method, in comparison with others, is that it takes into account the most important factor affecting the competitiveness of the enterprise - the competitiveness of the goods.

As a disadvantage, it should be noted that there is no way to judge the advantages and disadvantages in the work of the enterprise, since the competitiveness of the enterprise takes the form of the competitiveness of the product and does not affect other aspects of the enterprise.

Among the methods for assessing the competitiveness of a product deserves attention method "Price - quality". A method that uses as the main approach to assessing the goods of an enterprise, including a new one. The starting position of the method is that the competitiveness of the manufacturer is the higher, the higher the competitiveness of its products. The criterion for assessing the competitiveness of a product (service) is the ratio of price and quality. As an indicator that evaluates the competitiveness of a new product, the ratio of two characteristics is used: price and quality. The most competitive product has the optimal ratio of these characteristics:

, (2.1)

CT- indicator of product competitiveness;

To- an indicator of the quality of the goods;

C- an indicator of the price of goods.

The higher the difference between the consumer value of the product (demand price) for the buyer and the price he pays for it, the higher the margin of competitiveness of the product, the share of the consumer (Fig. 5).

Rice. 5. Assessment of the competitiveness of the goods (in the dock)

The advantage of the method: it takes into account the most important criterion that affects the competitiveness of the enterprise - the competitiveness of the product.

Disadvantages of the method: allows you to get a very limited idea of ​​the advantages and disadvantages of the enterprise, since the competitiveness of the enterprise takes the form of the competitiveness of the product and does not affect other aspects: market share, product quality, brand reputation; the effectiveness of product promotion, the possibilities and efficiency of production, the administrative apparatus.

Boole method is based on the calculation of universal coefficients, initially based on the "price-quality" ratio. Used to identify priority competitors and determine the strength of their positions. It classifies enterprises depending on the calculated indicators into groups of leaders, catching up and followers.

The indicator of competitiveness K is determined by the formula:

, (1)

T is an indicator of competitiveness in terms of technical parameters;

E is an indicator of competitiveness in terms of economic parameters.

(a), or (b) (2)

Ri- absolute value i- th technical parameter of the test material;

- absolute value i-th technical parameter, taken as the basic one (that is, for the comparison sample);

or - relative indicator of material quality according to i- mu indicator;

Li- weight coefficient i- th indicator (determined by experts);

n- the number of technical parameters of interest to the consumer.

From formulas (2.a) and (2.b), choose the one by which the increase relative indicator is responsible for improving product quality.

(3)

where: - private index of costs for processing the analyzed material relative to the base sample:

- cost share j-th type of costs in the price of consumption of the base sample (otherwise, the weighting coefficient of the j-th indicator);

- consumption price of the analyzed product;

Withj- costs in value terms for the acquisition and processing of the analyzed material;

- costs in value terms for the acquisition and processing of the basic sample according to j-th type of costs. The material is competitive if Toi 1.

Assessment of the competitiveness of an enterprise covers all the most important assessments of the economic activity of an enterprise, eliminates duplication of individual indicators, and allows you to quickly and objectively get a picture of the position of an enterprise in the industry market. The use of comparison of indicators for different periods of time during the assessment makes it possible to apply this method as a variant of the operational control of individual services.

findings

  1. Despite the fact that there is no single concept of “competition” in the world, all economists agree that competition is the driving force behind the development of society, the main tool for saving resources, improving the quality of goods and the standard of living of the population, as well as the main incentive for adapting to changes, that is, the introduction of changes, the improvement of the structure of the enterprise.

    There are both positive and negative features of competition.

    Competition in a market economy performs the following functions: regulatory, allocative; innovative; motivating ; distribution; controlling.

  2. Competition is a form of interaction between market entities, a mechanism for regulating market proportions, a set of methods, an economic process. Acting as a mechanism for regulating proportions, competition makes it possible to determine the magnitude of economic regulators, which are prices, the rate of profit, the rate of interest on capital, and a number of others. The extended concept of rivalry introduced by Porter proceeds from the fact that the ability of an organization to realize its competitive advantage in the underlying market depends not only on the direct competition that it faces, but also on the role played by various competitive forces, therefore, the essence of competition, in his opinion, expressed by five forces: Together, these forces determine the inherent attractiveness of the long-term profit that can be made in the commodity market. It is the interaction of these five forces that ultimately determines the profitability potential of the product (service) market.
  3. For an in-depth study of the category of competition, its detailed detailed classification is necessary. The classification of competition is necessary in order to identify its specific features and take adequate measures to participate in the competition and win it.

    There are several types of classification of competition.

    It is possible to distinguish between intra-industry and inter-industry competition. Competition may be due to natural factors, as well as geographic. In addition, competition can be objective, subjective, functional, specific, direct, expected. It is also customary to single out internal and external, regional and interregional, conscientious and unfair, price and non-price, perfect and imperfect competition.

    Based various kinds competition, there are various methods of competition. They are divided into: price ; non-price; dishonest; monopolistic.

  4. The most important factors of competition include: the number of firms and their sizes; product specifics; the nature of demand and prospects for the development of the industry; costs associated with switching consumers from one supplier to another; existence of barriers to exit from the industry; rivalry between competing companies; competition from substitute goods; the threat of new competitors; economic opportunities for suppliers and buyers, etc.
  5. There are three main types of competitive behavior of the firm: creative, guaranteeing, opportunistic.
  6. Methods for assessing the competitive situation include the assessment of competitiveness and the assessment of competitive advantages.

Competitiveness- this is a complex multi-aspect concept, meaning the ability of a product and, accordingly, a commodity producer to take and maintain a position in a competitive market (markets) in the period under review when competing with other goods of a similar purpose and their producers. In the modern market, competitiveness is the ability to get ahead of others, using your advantages in achieving your goals.

When assessing the competitive environment in a particular market, it is necessary to distinguish between the competitiveness of goods and enterprises.

The competitiveness of a product should be understood as a complex of consumer, price and quality characteristics of a product that determine its success both in the domestic and foreign markets.

When assessing the competitiveness of a product, the main factor is the sources of competitive advantage. Competitive advantages are: low costs, high quality and a strong degree of differentiation.

If we consider the concept of "competitiveness" in relation to the enterprise, then it can be defined as the possibility of effective economic activity and its profitable practical implementation in a competitive market.

The key concept of the competitiveness of an enterprise is its competitive advantage.

An analysis of the competitiveness of an enterprise and its product should begin with a study of the conditions of competition in the market.

The methodology for assessing the conditions of competition was developed by M. Porter and is based on the "national rhombus".

There are many methods for assessing the competitiveness of products and enterprises. The most important of them are the following:

  • matrix method for assessing the competitiveness of an enterprise, developed by the Boston Consulting Group;
  • General Electric matrix "market attractiveness - business efficiency";
  • a method based on the theory of effective competition;
  • benchmarking;
  • method of multi-attribute assessments;
  • method "price - quality";
  • Boole method.

Questions for self-examination

  1. Define the concept of competition.
  2. Formulate the main signs of competition.
  3. Evaluate the positive and negative aspects of competition.
  4. Describe the functions of competition.
  5. Name five competitive forces (according to M. Porter).
  6. Describe all types of classification of competition.
  7. Describe the main methods of competition.
  8. Name the main factors of competition.
  9. Describe the types of competitive behavior.
  10. Define the competitiveness of an enterprise and the competitiveness of products.
  11. Name the competitive advantages of the product and the enterprise.
  12. Describe methods for assessing the competitiveness of products and enterprises.

Bibliography

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