Disadvantages Of Competitive Advantage

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What is Competitive Advantage?
Competitive advantage is the act of a firm being in a more favorable position in the market that its rivals when it comes to operation. McGrath(2013) stated that competitive advantage can be displayed regarding having affordable products or services and having quality product or service. Quality of service or quality is one way to which a firm can beat rivals in endearing itself into customers. Customers prefer consuming the best quality in the market, and the firm with the best quality makes more sales. Affordability of a product or service is another way a firm creates a favorable position among consumers. Customers prefer to purchase an affordable product or service where the substitutes presented to them are of the same quality. A firm with competitive advantage has a higher number of sales from repeat and new customers. The high quality and affordability make customers keep purchasing the product as new customers are attracted to the business at the expense of rivals.
How do firms build competitive advantage?
According to Sanchez (2010), manufacturing equipment, machines, and processes are modern in a firm that has a competitive advantage. The equipment, machines, and processes are better than those of rivals. When machines, equipment, and processes are modern, it means that better quality of products or service will be offered. Better machines, equipment, and processes ensure that the firm can produce more efficiently than rivals.
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