Economics of competitive advantage essay

airline industry competitive advantage

Walmart uses the backward expansion strategy to extend Competitive Advantage Vs. The more new airlines come into the industry, the more competitive the industry becomes. For example, Southwest Airlines, which is the fourth largest carrier in the US, concentrates on maintaining low fares for its customers.

Benefits of competitive advantage

Diversity is often thought of as ethnic, but diversity can cover things ranging from diverse religious views to different perspectives on how work should be accomplished It is now and again more affordable to buy an exceptional from organizations with comparative advantage than it is to prepare the great inside. Then I will explain the sources of competitive advantage and how the distinctive capabilities of a firm allow it to sustain added value. In addition, resources possessed by a company and its business strategy have a deep effect on the production of a competitive advantage. Within these business sectors, Virgin Atlantic has established a competitive advantage by differentiating and strengthening its brand. With the competitive analysis you have five areas that have to be analyzed in order to be competitive. Threat of New Entrants If it is easy for new firms to come into the industry, the chances of competition intensifying are very high. Next team C will explain why starbucks chose these strategies and how the choices will affect sustainability and long-term organizational performance. As example of an assembling organization outsourcing might be Dell purchasing some of its components from an alternate producer to spare on handling expenses. The given case on Nintendo showed that by , Nintendo appeared to be heading towards an end as its rivals Microsoft and Sony has captured the market through Xbox and PlayStation 3 respectively The high labor costs result from paying pilots, flight attendants, customer service staff, etc. Cost leadership: It is a business strategy that allows a company to lowest cost production in an industry. Companies should look at the social, cultural, political conditions and strategic decision making when conducting business in the global market.

Porter's four determinants and two outside forces interact in a "diamond" of competitive advantage, with the nature of a country's international competitiveness depending upon the type and quality of these interactions To be the lowest-cost producer, a firm is likely to achieve or use several of the following: High levels of productivity Use of bargaining power to negotiate the lowest prices for production inputs Lean production methods e.

In the airline industry, small airlines have tended to stick to cost leadership business strategy. Competitive advantage can differentiate the company and others competitor from the eye of customer. According to Jessopa society where knowledge is essential in the global world where innovation is a must for economic growth.

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Economics Essay Sample: Competitive Advantage in the Airline Industry