Competition

Analysis
By Shubham Thaker
Bba Semester-4
Shree Swaminarayan intitute
AAK college Chaya Porbandar
 Introduction
 The term competition is found everywhere in all the
segments of human life. Competition means to
stand first or to achieve the vest position among all
where there is only one the struggle starts between
or among them.
 Types of Competition
 1. Price competition and Non-price Competition.
 2.Predatory and Discriminatory Competition .
 3.Fair and Unfair Competition.
 4.Effective Competition.
 1. Price and Non-price Competition.
 It is related with price of the product every
producer wants to sell its product at high level.
 Now every seller wants high selling so now the
scenario is the price competition becomes a very
complicated issue for the producer. On the other
hand he wants maximum profit and on the other
hand he wants to increase his sales.
 Example
 MG Hector and Kia Seltos
 Both cars are manufactured under similar platform
MG is been manufactured in Bojun 530 and Kia is
in B-SUV(SP2) platform.
 Price of both cars are similar for MG it is 21,80,000
and for Seltos price is 21,40,000 Ex showroom
Delhi.
 Both cars are same 90%
 Both cars have not their own engine kia borrowed engine from
Hyundai and MG borrowed engine from Volkswagen China
group.
 While kia is giving displacement of 1493 and MG is giving
1956
 Both kia and MG comes in diesel engine on other hand kia is
giving mileage of 17.8kmpl and MG is giving best in class
mileage of 20.52 kmpl.
 When kia launched seltos in india with joint venture with
Hyundai price was in average point not very high or low and for
MG price range was little bit premium due to one of the best
known cars of MG is hector in all over the world.
 In India when they commenced pre-booking of car they received 3000 booking
from all over the India due to demand of car the price range was at premium side
the price was 23,40,000 but after the launching of kia seltos MG had to reduce
the price and had to face tough competition in market.
 Both cars are giving 90% of same features and specs but seltos Indian started
buying seltos. Although MG has also a good exterior in facelift and Pre-facelift
edition but kia has some extra ordinary exterior designs. Although seltos is
garbage. But as an good sentence that Indian are always fools. kia know that
Indians are always boom of showoff nothing else. At whatever price they will
buy. If kia set the price of seltos at 50 lakh people will buy because exterior is
good nothing else.
 What MG thinks
 MG just wants to produce sage and reliable cars nothing else and at cheap price.
MG has not spent their time in exterior designs.
 Why I choose this company?
 Because both companies are new in Indian market both company has
faced lots of problems in Indian market. Due to fools.
 2. Non- price competition
 In non-price competition is more beneficial to the
producer because he does not have to face his
directly. Secondly producer can introduce his product
with some new change or improvement, new
schemes can be adopted and by that way without
touching the price the producer can promote his
product. The firms compete with rivals not only
through price variations but also through non-price
competition to expand their sale.
 Example
 In this case we have taken Maruti Swift and Volkswagen polo car
top end variant
 Both cars are 90% similar and since many years they are in the
Non-price competition.
 From launching of swift in 2005 there is not any single car that
have suffered in competition with swift but from after that in 2009
fiat launched punto and then swift has to suffered in competition
and in 2010 Volkswagen launched the Polo car and from 2010 till
present date there is an tough competition between swift and polo.
 Prices
 Maruti swift cost @ 677948 INR Ex showroom Rajkot. and
 Volkswagen Polo @ 834200 INR Ex showroom Rajkot.

 On Road Prices if we see of both cars

 Swift would be 754478 INR Rajkot
 Polo would be 932055 INR Rajkot
 Difference of 177577 lacs (on road price) and 156252 lacs.
 Why I choose this two companies
 Because since 10 years these both companies are in
tough competition both have awesome sales and
awesome customer feedback and vast options for
modifications from company accessories itself.
(Aftermarket modifications is illegal in India).
Basis of Differences MS Swift VW Polo
To provide Free home Yes, but in the city only. Yes, not only in city but
delivery goods. VW offers home delivery
in the range of 120 km
outside of city.
Warranty Period Only one warranty for Different warranty for
mechanical parts (2-3 different parts like for
Years) color, mechanical parts
and electrical parts(5-
years)
Services and Cost 3 free service and every 6 1 year service and every
month or every 10K year or @15K kms
services, periodic whichever is earlier cost
services. Cost about 4 to about 8.5K – 10K Rs.
5500 Rs.
Mechanics trainings One time training after Every year mechanics get
joining training for best in class
service.
Free gifts with selling of They give coupons to VW assures you
goods. customers but in that guaranteed gift to every
coupons there is lucky customers
draw if you get the code
then you will receive the
gift.
 3. Predatory and Discriminatory
Competition
 Predatory competition through predatory pricing is a risky pricing
strategy.
 1. where a product or services is set at a very low price.
 2. with the intention to drive out the competitors from the market or
 3. create barriers to entry for new or potentials competitors.
 If the existing competitors or new competitors cannot sustain equal
or lower prices without making losses they go out of business or
choose to entre the market. So predatory merchant has fewer
competitors.
 Discriminatory competition happens through discriminatory
pricing or price discrimination this can happen in the
situation of monopoly or imperfect competition
discriminatory pricing or price discrimination can happen in
more or less degrees.
 Example of Predatory competition
 MI and Samsung.
 Both companies are manufactures their smartphones from
5000 to 80000, 1 lacs.
 Like MI other brands are also there like Realme and Oppo
in this predatory competition.
 Now what MI Realme and oppo vivo does
 They manufactures their mobile and sell their at very cheap cost what Samsung
manufactures that only they manufactures but in very cheap quality and cheap
pricing. And Samsung manufactures mobiles at very sophisticated manner and
their build quality is just insane. But they charge premium for their product.
Because they know that what they are making.
 Here MI and Realme just make their mobiles very attractive from outside and uses
very cheap quality material inside that’s why MI phones battery blast.
 Indians are always boom of showoff. Nothing else and MI and realme mobiles are
for just of showoff and Samsung phones designs are very simple and sober.
 If Samsung manufactures their mobile at cost of Rs 10K and launches the model
then within one month only MI launches the model of same specifications but in
the price of just 8500 only.
 Samsung paid commission of 5 to 8 % to dealers and MI and realme
paid Commission of 18 to 20% to dealer so dealer also just advertise of
MI and Realme mobiles as we all know that Indians are fools and
people don’t think any single point just buy the MI and Realme
phones. We all know that MI and Realme both are the sort of Garbage
only nothing else.
 Due to very low price customers are purchasing more and more phones
of MI and Realme but they don’t know that they are becoming fools.
 And MI is not trustable company like Samsung. Samsung launches the
model and then after 1 year or 1 year 4 months they upgrade their
model.
 But MI launches the model and after 6 months only they upgrade their
model.
 Why I choose this companies
 Because Samsung is the worlds most trustable
company. And on other hand MI and Realme both are
the worst in terms of trust. Trust is very far away for
MI and Realme because they also don’t know when
our mobile will blast while charging or in direct
sunlight.
 Discriminatory competition
 In this case we have taken the example of Cinema hall.
 In cinema hall there is different prices for children and for
adults and also depends on show timings in morning show
prices of tickets are at very low cost (Especially in Matinee
show ) and at night show ticket prices are high.
 Why I choose?
 Cinema halls pricing is very common right now and in
every multiplex this policy is been made for people.
 Fair and Unfair competition
 The words Fair and Unfair are related to morals any market has the
elements of elements of earnings profits, competition , risk and
uncertainty etc. even with the presence of all these elements the element
of moral is necessary. As a part of social responsibility of producers and
sellers they have to be alert about their royalty towards the society and
customers. The producers should not try to cheat the consumers by
producing false trust introducing his product superior to all other
products.
 Example of Fair competition
 Maruti Suzuki India limited
 Every car prices of Maruti cars are very fair and there is not any
single type of misleading activities by company to its customers.
Another company we can say that is Honda cars. Prices are very fair.
Like Maruti cars.
 Maruti cars promote their sales but not by harassing other products.
In the showroom of MS no one will say that Honda cars are very bad
in terms of driving and very costly.
 Company maintains the interest of shareholders very carefully.
 Why I choose
 Because Maruti Suzuki is well known and best car
manufactures in India and is maintaining their all ethics
since years.
 Example of Unfair Competition
 Tata Motors company is maintaining unfair competition with rivals
tata group is not trustworthy. With their rivals.
 Tata motors don’t have an good public image and also they are not
maintaining good interest with shareholders.
 Many of the people said that whenever we went to tata showroom
the sales guy just say good points of their company and all the bad
points of other companies. Something customer have not asked any
single question of other companies then also sales guy start saying
negative of other companies.
 Since 10 years tata motors has been suffering in loss and in
10 years they have doubled their loss but they have not
confessed to shareholders they are just saying that we are
working hard nothing else…….
 CNBC Awaaz confessed this point of loss once on TV but
company has not.
 Tata motors cant maintain their public image right now due
to unfair competition and not a single per% of customer
satisfaction they have.
 Why I choose
 Because this company is trying to become Rolls Royce in terms of
loyalty.
 And also this company is trying to become like Genesis cars
manufactures.
 Tata motors are worlds most worst company after Mahindra cars.
 In this case also those who are buying tata cars right now they are just
fools.
 Effective competition
 To command the market and customer different producers
apply various ways of price output policies. In case of
perfect competition different sellers adopt various methods
of selling the products effectively and they get sufficient
response from the customers.
 In this competition sellers and buyers both have knowledge
about market conditions so the selling activity becomes
easy without any advertisement.
 Example
 In this case I have selected the Airtel and Vi (Vodafone
idea)
 Because both buyers and sellers have an proper knowledge
of market.
 Besides both producer has his own policy for price-output
level. As it is said about the customers and conditions.
 Effective competition is possible because there are large
number of buyers and sellers.
 Whatever production is made buy producers they are close
substitutes to each other.
 If an customer is not satisfied he/she can port mobile
number from Vi to airtel.
 Moreover there is the entry for new competitors and if they
are not satisfied they can leave the industry without bar.
 Why I choose
 In effective competition this both companies are the best to
understand this topic.
 Both has equal customers and also both has same pricing
policies.
 Conclusion
 So by referring the above slides we are at the point where
we can easily understood the different- different types of
competition economy. And we also understood all by
understanding examples.
Thanking you.