1.2.4 The competitive environment

Which of the following statements best describes the term, competition?

• When different businesses attempt to attract different customers
• When businesses do not have any rivals
• When different businesses attempt to attract the same customers
• When different businesses have only one supplier of raw materials

Which of the following is an example of a business that has a competitive strength based upon quality?

• A discount supermarket that offers value for money groceries
• A local convenience store that sells a wide range of commonly used products
• A restaurant which uses fresh, local produce in all of its dishes
• A coffee shop that has an outlet on a busy shopping street

Which of the following ways might a small successful technology firm manufacturing unique products use to compete with its rivals?

• Reduce its prices
• Offer an excellent after sales service
• Reduce its product range
• Relocate production to a busy high street

Which of the following is a competitive weakness based on location?

• A restaurant locates on a quiet side street in a busy town
• A footwear shop offers a kids shoe fitting service by untrained staff
• A supermarket frequently runs out of stock of popular product lines
• A local café serves food to customers which is cold

In which of the following scenarios would a business face no competition?

• When there are several suppliers of gas available to residents
• When there are many telephone networks available to residents
• When there is only one supplier of water to residents
• When there are numerous electricity suppliers available to residents

Which of the following businesses is best known for its ability to compete with its rivals on price?

• Primark
• Marks and Spence
• J D Sports
• Selfridges

An independent, high fashion retailer targeting teenagers has recently opened in a popular shopping centre located in a busy city centre. Which of the following is the best way the business could compete successfully with its rivals?

• Charge higher prices and offer a smaller product range
• Charge lower prices and offer a wider product range
• Charge high prices for low quality clothing
• Charge moderate prices and provide a low level of customer service

A national retailer offers to refund the difference if customers find the same product cheaper elsewhere. This is an example of competition based on:

• Location
• Price
• Quality
• Product range

Which of the following would be a suitable way for a start-up take away business to use to compete with its rivals?

• Offer a limited choice of options on its menu
• Offer higher prices for similar food options
• Offer a highly efficient and friendly service
• Price match in conjunction with offering smaller portion sizes

Which of the following best describes the term, competitive environment?

• Where every business attempts to minimise its costs
• When a business is the only seller of a good/service in a market
• Where different businesses in different markets compete on price
• The extent of rivalry between different businesses in the same market