This was posted on one of the group on linkedin. Following Question was posted by Mr. Sajid Ali

Is a competition good or Bad? For any business to grow should there be a competition or without it one can do a better expansion?

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Reply by Dhawal Shah
Competition is good, it keeps us at our toes, competition is the reason why we see such good products and services being made available. Without competition, from Hyundai, Toyota, Honda and Indica, Maruti would never innovate.

Several other interesting examples. We would not have added so many unique articles and built a social community, had there not been any competition.

Competition is also good for consumers and the corporations. Hence, I would say: Competition = Progress

Reply by Sajid Ali
Thank you Dhawal, your comment are absolutely perfect. In context to the business owner yes it helps you carve your product better and better but does it really help business owner in increase the business volumes or competition eats up each others share. Does it help in creating an awareness in the market and hence increasing the overall business, so that the share which comes to you in turn is more than what it would have been without the competition?

Reply by me (Samir Lalani)
I certainly agree with Dhawal. To me competition means a way to succeed and innovate. If there is no competition we would not try to bring innovation in our products & services.

Such development in technological products as well as many other products is a result of competition in that particular industry. Without competition there is no way to progress. Competition is not only good for consumers but also for companies.

Answer to Mr. Sajid’s question in my way:
Well I think that competition does eats up your share in market but at the end of the day if you have better product & better service to consumers compared to your competitor’s you can still enjoy major market share. Of course you should have right strategy to communicate your products & benefits to consumers efficiently and correctly.

Reply by Nahid
Healthy competition is always good,for any business to grow and expand competition is not required…it is the thirst of a company to grow to a certain level…to what level it depends on every individual…Strong planing and execution would be required for any business to be successful.

Reply by Dhawal Shah
Competition may in the short term eat into one another’s market share, however, in the long run, it helps enlarge the market.

Reply by Madhusudan N
Competition is something which you may never be able to stop. Competition is a check for the consumersto get the best deal. Competition emerges to expand the market, it never restricts the market at all. A few examples which may make it more clearer :

1. Air Deccan can and expanded the market in the airlines. 6 years before when there were only few air carriers, today the total air carriers have doubled, the total number of aircrafts have gone 3 times, the airports have become better, the services have become much better and overall it has expanded the market wider. Now you have a choice of different airlines operating in different segments.
2. Dhawal was right with Maruti’s example, though when Maruti was operating as a lone leader with ambassador and fiat as competition, it used to sell 3 lac cars in an year with a 60% market share. Today they sell 1 million cars with around the 55% of market share. They may have come down on the overall share but they have grown 3 times more in terms of the volumes.
3. Telecom is another example. With so many number of competition that we never had, today has expanded the market beyond limits …no wonder why the world is running towards India to capitalise.
4. Look at retail…is it the same anymore. With so many multi formats, multi brands …the game is wide enough and enough players can still come in and compete.

What does competition generally do ?

1. Competition historically has changed the positioning eg. Maruti’s tagline was “Building Trust. Worldwide”…changed to “count on us” (A total change in the attitude)

2. Competition creates new benchmark – “One Paisa per second”. Everyone jumps into fray.

3. Competition generally makes the company look into its own operation and strart strengthening their strength rather than loose more money in price wars or could be debated in many ways.

4. Yes makes you Innovative – the segment wherein Santro was the only model, Maruti brought in 4 more models to fight in that segment which meant expansion of the same segment and overall th beneficiary being Maruti.

5. competition makes you becoming more slimmer to ensure that wherever they could cut costs, they would and are ready to face the push that the competition gives.

6. Competition also ensures that incase if you are not good and the vision of the products are not in tune with the trend, you may be wiped out very soon. eg. Television markets – Where are Weston, Beltek, Keltron brands ? Have they gone into history books

Good Replies by all. Whats your take on this? Do Comment!

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