Competitor Analysis and Industry Forecasting

An analysis of each significant existing and potential competi-tor can be used as an important input to forecasting future industry conditions. The knowledge of each competitor’s probable moves and capacity to respond to change can be summed up, and competitors can be seen as interacting with each other on a simulated basis to answer questions such as the following:

  • What are the implications of the interaction of the probable competitors’ moves that have been identified?
  • Are firms’ strategies converging and likely to clash?
  • Do firms have sustainable growth rates that match the indus-try’s forecasted growth rate, or will a gap be created that will invite entry?
  • Will probable moves combine to hold implications for indus-try structure?

Source: Porter Michael E. (1998), Competitive Strategy_ Techniques for Analyzing Industries and Competitors, Free Press; Illustrated edition.

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