3.2.6 - Competitive environment GapFill

Businesses face competition, and while some prefer to be located away from competitors, others find it easier to be near them. An example of businesses that locate near competitors would include  cafespersonal trainersshops in a mallonline businesses. Some businesses are so expensive to set up that the existing ones face little competition. An example of this would be a business offering  clothingcruisescar repairssnacks. In some markets, customers focus on  servicesopening hoursgoodsprice so that businesses have little flexibility in what they charge. This means they need to keep their costs as low as possible to make profit. Customers who are more interested in value for money may feel the businesses have overlooked the  spacecolourqualitysize of their product, and not buy from them. Businesses need to be very aware of who their customers are in order to minimise the  benefitsadvantagerangerisk of not meeting their needs. 

Even businesses selling necessities (food and basic clothing) can face uncertainty if the economy is struggling, unemployment is rising and customers are not confident about spending money. Supermarkets may find there is more interest in their  basicchocolateluxuryhousehold range of goods and less interest in their  bakeryluxuryfishbasic range. This will affect their revenue. Other businesses will struggle as people aim to  economisespend morebuy carstake a membership and reduce their spending overall.