Hello my friends! It is a pleasure to have you here. It is important to me that you always feel comfortable asking me any question you may have, because questions are the only way we can truly grow. So my question for you today is: Do you think we live in a competitive world?
Competition in the business world has existed for many years. You can see competition in prices, clients, sectors, etc., but there are also different kinds of competition within each business. The most common types of competition in the business world are:
1. The Perfect Competition, where consumers and producers find an equilibrium. The price is fair and each company has enough clients. We can see examples within the plastic industry or agricultural markets, because they cannot raise the prices whenever they want. They need to find an equal price where they can all buy and sell their products.
2. The Monopoly Market, where just one company has the power. The consequence? Outrageously high prices. The consumers don’t have any alternatives to buy that product, so whatever price the monopolistic company sets is the price that it will be. (Of course this is a business theory, because if you introduce the government into a true monopoly scenario, they won’t allow it. Tasks of the government require them to assist, moderate and watch so companies do not take advantage.) Some examples are: oil, gas, and high technology. These kinds of businesses require a high level of knowledge and speciality, making it almost impossible to compete.
3. The Oligopoly Market, you will find similar companies with equal influence so the competition is harder. Most of the time, copy cats begin to appear. A good example of this is cell phone service providers, walking down the street you can see two cell phone service advertisements and they will look almost identical.
4. The Monopsony Market, where, contrary to the monopoly market, the consumer has all of the power. Why? Because the consumer is the only client, so they have more control with the pricing. This is a weird and rare scenario to happen, but one example is armament. The only consumer is the government, therefore they can negotiate and decide the price for it.
Now that you know the different types of markets, in which market is your business located? What does your competition look like? You must know and be aware of these things, because depending on your answers will depend on what strategies are best for you to use.
But how do you compete with the big companies? How do I enter a market if everything looks full? First and foremost you need to have confidence and full belief in yourself and your business. Not quite there yet? Check out how to get there here: https://andresamaya.net/self-confidence/. Secondly, go in with this mindset:
“Even if you are small company think like a big company”
This is advice I have been given by my millionaire mentor that I have found to be irreplaceable in helping me achieve the right business mindset. You can not limit yourself, your company, and your vision to being small forever. All of this in addition to a new era of competition: Competitive Collaboration. Competitive Collaboration is one of the strategies that multinational companies use, and is one of the absolute best strategies that you can use.
For example: When buying a hamburger, you’ll probably want something to drink, these are complementary products. Mc Donald’s and Coca Cola have the money and power to put their products wherever they want, but they also know that each of them attract clients, so why not team up and sell their products in the same place.
Big companies are too busy to compete with every new company on the market, so if they see an opportunity to combine their power sales and improve their profit, they will.
Here is another example: Volkswagen Auto Group uses adaptation and unification to buy more companies in their business market to grow.
And there are millions of other examples like this. The Collaborative Competition is huge, so go and find which other company you can collaborate with. How can you give them value so that you will both benefit?
If you have any questions, please ask me! As entrepreneurs we are always trying to create value. Networking is one of the most valuable assets in our world. If you know this article will benefit anyone, please share it with them. Always remember whatever you give you will receive tenfold. Let’s connect.
Are you giving your 110%?