WAYS
BUSINESSES
COMPETE
It’s a dog eat dog world!
LEARNING TARGET
▪I can explain how
businesses compete and
influence the market.
BUSINESSES COMPETE IN MANY WAYS…
▪Why would a business
compete?
▪Who would they compete
with?
▪How does this help the
consumer?
LOWERING THE PRICE
▪ Joe and Moe both sell t-shirts
▪ Joe sells his for $5.00
▪ Moe decided to undercut Joe
and sell his for $4.50.
▪ Joe decides to match Moe’s price
and lowers his to $4.50.
▪ This could continue for some
time, but when would they HAVE
to stop lowering their prices?
BETTER PRODUCT
▪ Some businesses will work to
make their product look better,
work more efficiently, last longer
or do more.
▪ Prices may be the same or even
higher than a competitive
company. The main goal is to
offer a product that is better
enough to override the price
difference.
BETTER CUSTOMER
SERVICE
Some businesses try to persuade consumers to use
them because they offer friendly, knowledgeable
people to help with their problems. This means
they must hire these type of people. For example,
if a person buys a computer at a store, but then
can’t find anyone knowledgeable that works there
to help them, they will be more likely to go to
another store in the future.
ECONOMIC INCENTIVES
▪ Offering something ‘special’ or ‘extra’ is another way to
compete. Rewards like a toy in a Happy Meal or a free drink
when you purchase a slice of pizza will often prompt
customers to visit that business.
▪ Some places have rewards programs for recurring shoppers.
Generally, once you’ve visited the store so many times, you
get a special discount or money back.
▪ Other businesses allow special coupons that can only be
used in their store. Often times in conjunction with
manufacture's coupons, which would give the customer a
huge discount.
ADVERTISING
▪ Often, a business will rely on advertising to
promote their products to the public. They may
hang up signs, do TV or Radio ads or run a
newspaper ad.
▪ The purpose of these is to tell the customer
how wonderful their product is, where their
business is located and any specials they may
be running at the time.
GET OUT A
PIECE OF PAPER
1.) Fold it in half (either way)
2.) Fold it in half (the opposite way of #1)
3.) Write 1, 2, 3 and 4 in each section
WHAT DO YOU
KNOW?
1.) Lower Price
2.) Better Product/Service
3.) Incentives
4.) Advertising