Topic:Competition in Business

Competitionin Business

Competitionis the existing rivalry between firms striving to make progress intheir sales and make earnings from it. Usually, competition is thedriving force behind any market, thus, competition is an unavoidableforce in the modern day business environment, competition exist inevery aspect in business today, that is, competition betweenindividuals, there is rivalry between teams, competition existingbetween organizations, and even on the international scene therestill exist trade rivalry between different states that producecompeting commodities. Therefore, analysis of business rivalry showsit is healthy for growth and development of business or anorganization, however, there are a few downsides associated withfierce competition as this essay elaborates.

Advantagesof Competition in Business

Businessand markets facing barriers inform of harsh competition policies fromthe government or firms faced anti-competitive behaviors by rivalfirms, which is a common scene in developing markets diminishesopportunities for innovation and growth, making consumers to suffer.These markets are often dominated by big business with close ties tothe governments of these states, were there effective competition isestablished, there is a reduction for corruption opportunitiescreating more space for entrepreneurs and SMEs to grow. However, itis essential to keep in mind that efficient and fair competition isnot an automatic thing. Therefore, sound competition policies canplay part in assisting markets to work better, in addition to whichit is a key part of a conducive investment climate that helps boostthe investors’ confidence, and offer a level playing ground to thedomestic SMEs. Therefore, for a market to remain competitive thereshould not exist any entry barriers to allow new firms to enjoy theexisting business opportunities, and still exit barriers should notbe there to allow exit for those unable to compete.

Competitionoffer growth for the firms in the market. That is, a competitivemarket gives room for the utilization of state’s resources to besteffect in the production of goods and services. For instance,competition offers firms continuing incentives to make theirproduction and distribution more effective, allowing them to take upnew and better technologies, and be innovative. These resourcesoffered for productivity improvement lead to growth and povertyreduction. The level of competition in business likely influences thehost country competitiveness, that is, the ability for the domesticfirms to compete in the export markets, and against imports in thelocal market. According to research in competition in the businessenvironment, it has shown that the existence of competition in thedomestic market acts as a significant factor in the promotion ofinternational business, leading to a higher international integrationbetween nations and industries. The essential integration yields highproductivity and fair competition in the business environment.

Competitionand competition policies in business environments utilized as a meansof poverty reduction. The poor interact with the economy a number ofways, and governments must take actions to help markets to functioneffectively for the poor people. This way the government will haveenabled choice, encouraged innovation from these people that willultimately lead to the creation of goods and services at lowerprices. Notably, majority of the poor are small entrepreneurs, whichinclude farmers. This group will benefit in conditions where entryand exit barriers are low, production inputs are available at lowerprices, and where they will be able to trade their yield atreasonable prices, giving back reasonable returns.

Positivecontributions of competition have been recorded in the up-and-comingstates whereby they have been creating good business environmentsconducive for improved productivity, promoting innovation, and betterprices. For instance, in Asia the importance of good competitionpolicies are viewed to be crucial components of good businessenvironment, and as actors of stimulating further growth. Inaddition, good competitive policies for businesses have beenwitnessed to increase the level of employment in countries like SouthAfrica.

Goals,deadlines, and production, are all affected by the level ofcompetition in business. For instance, goals in business are met inan environment that competition exists. This is from the assumptionthat the best achievers are realized through the accomplishment ofset goals and objectives in the required deadlines. In the case ofproduction in a business firm, it is increased where there isexisting competition. This happens in the sense that as employeescompete, they also increase production in a bid to outcompete eachother. In scenarios where employees compete in teams, the businessunit enjoys enhanced teamwork, with improved communication beingwitnessed between team members. This kind of a business environmentwill automatically result to better work quality, since the only wayto be recognized, as being the best is to put across great effort inthe workplace.

DisadvantagesAssociated With Rivalry in Business

Impactingtoo much stress, in that, an over highly competitive businessenvironment or workplace can turn to be stressful to those who underachieve. For example, take a business scenario where only one memberor only one group is always the best, this can easily demoralize andstress the low achievers in the business unit. This negatively affectthe business since such workers may end up produce less than whatthey would have produced in another environment. In addition, thereare individuals who do not perform well whenever they under pressure.

Unhealthycompetition at the workplace has the negative effects of deviationfrom the set organizational goal to individual goals. Employees in acompetitive business environment sometimes get carried away by tryingto be the best individuals doing this at the expense of the company’sset goals and objective. Thus, this will likely results into acts ofsabotage of collogues, or simply being uncooperative, jealous, andrefuse to aid the other to attain the set organization or businessgoals.

Finally,unhealthy competition in a business entity kills existence of a teamspirit. Whenever the competition intensifies in a businessenvironment workplace with individuals working to outdo each other,team spirit in the business unit is destroyed together withadvantages accrued to it. Individuals in such a business environmentturn to trying to achieve their own goals rather than enhancingcooperation to work as a team. Without doubt this impacts theproductivity of the business unit negatively, resulting to lowproduction or even cultivating a hostile working environment.

MyPosition on Competition

Iagree competition is necessary in a business environment in order tomake progress and ensure success. In fact competition in most casesis ways rewarding to both the business and workforce, inform ofrecognition, achievement bonuses, and promotions. In addition,internal competitions have been known to yield higher profits for abusiness, that is, through an increase in productivity resulting fromintense competition. Thus, I agree competition is necessary for abusiness to make progress.


Fromthe analysis in the essay we can tell competition is good thing,however, for competition to work for a business, a firm, a team, oreven a nation, it needs to be managed and monitored. This waycompetition will work for an organization or an entity involved inachieving its set goals and work against it.