What is the competition arena of the business
Businesses tend to be afraid of competition but competition exists in all areas of our lives.
Differentiation of the business will help it conduct itself better in the market.
Businesses tend to deal with the ongoing that sweeps them away and do not devote enough time to engaging in strategy and bus
iness development, which negatively affects the business results.
What do we do well and what should we improve? What processes contribute to the profitability of our business and which harm it. It’s no shame to learn from our competitors and if our competitor is doing something good we should embrace it in our business as well.
Lively competition is a good marker
It signals to us that we have chosen a market with products that are in demand and value.
An unbeatable market can be a monopoly or alternatively a market where there is no real need for your product.
Competitive trading operates on two central axes
Direct competition – that is, businesses that compete directly with the same product.
Indirect competition – with competitors who do not compete with a similar/similar product but with substitute and related products.
A living example
Take and examine McDonald’s, which started as a company that sells burgers and over the years the chain has introduced related products. Such as: Ice Cream and today is the chain that sells the most units of ice cream in the world.
Big Mac Index
The Big Mac Index is a comparison conducted by The Economist magazine from 1986.
The index compares big mac prices at McDonald’s in various countries around the world. The comparison is an informal way to measure the value of the purchasing power of currencies. And it is a measure of exchange rate appreciation and commodity costs in different countries.
The Big Mac is chosen because it is a basic consumer product that can be obtained in many countries and therefore allows comparison between many currency rates.
The index looks at how much Big Macs can be bought with a $20 bill in each state. That is: the more you can buy Big Macs with the sam
e bill, a sign that the cost of living is low and vice versa. The exchange rate is just one of them: in many countries, fast food in international chains (such as McDonald’s) is relatively expensive for food in a local restaurant. The demand for Big Macs in some countries is considerably smaller than in the United States. Other reasons for price disparities are regulation, increased (or fewer) competition in the fast food market, compared to competition in the United States, taxes and tariffs on the various components of the Big Mac.
According to the Big Mac Index for January 2020: Israel continues to climb, continuing the trend over the past three years and ranks 6th in the world, behind very expensive countries such as Switzerland, Norway and Sweden.
