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Competitive Advantage

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Competitive advantage is the lead that one has over other competitors or counterparts in the same line of activity, business or industry. It is usually achieved when a person or a business has a value that others do not have especially if this value is required for success in the common activity taken by all the competitors. In business, competitive advantage is gained when an enterprise offers better value to consumers for less or providing greater quality products and services that justifies relatively higher prices.

There various requisites that determine whether an entity can gain a competitive edge or not. These include strategies geared towards widening the scope of business activities by differentiating products and services in the market. A firm may gain a competitive advantage over its competitors by exceeding the average profits expected in a certain industry. The most important goal in business is to sustain this competitive advantage.

This advantage enables a firm to generate value for consumers while creating superior profits from its business activities (Porter 33). Therefore, the firm accrues more benefits compared to its rivals. The superior performance ensures market leadership and is able to manage resources by channeling them towards the right places to sustain the competitive advantage.

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