How do businesses make money? What strategies can they use to gain a competitive advantage?
Businesses ultimately aim to generate profit, which is the difference between their total revenue and total expenses. Here’s a breakdown of the basic profit model:
Strategies for Competitive Advantage:
In a competitive market, businesses need strategies to stand out and attract customers. Here are some key strategies:
Combining Strategies:
Many businesses employ a combination of these strategies. For instance, a company may strive for some level of cost efficiency while also offering unique product features (think well-priced smartphones with high-quality cameras).
The optimal strategy depends on the industry, target market, and the unique strengths and resources of the business.