Pros and Cons of Market Competition.

For every business in the world, there are forms of competition among them and it is what brings out the entrepreneurial spirit which in turn leads to unleashing potential in every entrepreneur. Market competition can be described as a business environment where different firms, from within and outside the country, compete to bring out the best of their products and services that are based on merit.

Competition makes people better. Just like what the President of Rwanda, Paul Kagame said in his quote, competition is a good thing, but some people shy away from it as they are unsure of what they can do. For a country to thrive economically, market competition must be true and exist, but in a place where there is no competition in the market, there is always special treatment for such businesses or firms just to avoid going into a competition.

Many entrepreneurs are into competition and it is something that brings the best out in them. There are customers who want the best and are looking for firms that can provide quality services for them and also satisfy their wants and needs. So, consumers get to gain a lot of benefits when there are markets competing with one another as they can get to consume quality products and services.

In a situation where services X and Y are in the same business, both services would go into competition in order to serve their consumers rightly and make them want to keep coming back. There are a lot of people fighting hard and producing the best product which could beat the other business and make the best sales.

Countries that support and encourage market competition are helping to unleash the entrepreneurial spirit in employers, thereby making the economic growth expand, but when a country does not allow such, it affects the economy and brings less growth to the country as well.

It is evident that when competing with other individuals, pushes them to a level of performance which ordinarily wouldn't have been possible with it, but without competition, the zeal to innovate or produce quality products can never be achieved.

Let me cite an example for us
In my area, there are two businesswomen; Business A sells provisions, same with Business B. Both went into a competition and this brought great energy and potential into their businesses in the end. I, being a customer have tasted both products and discovered business A is better than B in terms of neatness, welcoming attitude, lower prices, packaging and branding while B has a bad attitude in treating customers, and her products were not always packaged neatly. Along the line, Business B started losing customers as they began patronising A. Suddenly, she changed and became someone people would love to buy her goods. She called and asked why I left which I explained in a little way and she understood my point. She even told me her price of goods are affordable and that I should try them. I did and saw the changes. Though, I buy from both women and they are friends who understood each other today.

This is how market competition occurs. Competition is essential to make people good and discover their potential.

The Pros of Market Competition.

Some of the benefits of market competition are innovation, quality of products, and more options available. Competition spurs innovation as firms keep working to produce more quality products and are open to many options to choose from. They look at their competitors and want to invent new things and outdo them which in the end, brings the consumers to win as they are able to get their needs and wants met.

Another benefit of market competition is that it helps the country's economy. This is because when companies are competing with each other, they become innovative, competitive and efficient. These healthy habits make the economy grow, thereby creating more jobs in society and ensuring the absolute well-being of the people. Having a competitive market ensures that companies are always moving toward efficiency and productivity.

Competition ensures better prices. When companies are in competitive dynamics, it brings about a company's efficiency and in turn creates better prices.

Market competition creates more companies. In a country that allows competition among firms, it brings more people to create more businesses, and build new products because everyone has the same opportunity, especially in a country that is controlled by openness and equality, so people enter into business to bring out their potential and meet consumers needs which turns to a win-win situation for all.

Another benefit is that it favours consumers/customers. Companies compete together in bringing out quality products, a greater quantity of goods and services and low prices. At the end of the day, the consumers get what they want which is the best quality of goods and services at an affordable and better price.

The Cons of Market Competition.

Everything that has advantages definitely has disadvantages. The effects of competition in markets should not be ignored or looked down upon, because not taking serious measures could cause a whole lot of damage.

Market competition leads to the other party losing as a result of the company's bankruptcy. People lose their jobs which affects their financial and emotional state of mind.

Another disadvantage is that it leads to copying other people's ideas instead of coming up with yours. When Service A designs flyers and hands them to people, service B wants to do the same. When Service A produces an app to boost his business, Service B does the same too. This way, service B would lose so many customers for not being creative, and innovative and also lowers marketability and popularity.

Competition can make an employer lose focus on existing customers. When competition has started to affect customers, it becomes a big problem. Not only does one lose a customer to competitive companies, but it also makes you lose focus on what your customer wants and needs. Just because another business produces a new product does not mean you should create new ones and ignore the ones your customers need. One of the main aims of competition is to satisfy customers' needs. Also, there are customers who are still loyal to the business because of their consistency and quality.

In conclusion, as these effects are challenging, their long-term benefits are rewarding and greater. New products and services are created and also improve the standard of living, and goods are bought at lower prices, thereby channelling money on other things and then, boosting revenues in other companies. When there is a threat in competition, it leads firms to a faster rate of creating and adopting new strategies to provide quality products as they need to always respond to the needs and wants of their consumers. With market competition, there are risks involved, and at the same time, there are rewards to benefit from.

Thanks for your time on my blog.