HOW COMPETITIVE FORCES SHAPE STRATEGY

Moreover, we should also know that competition can arise from entities beyond direct competitors, providing the same goods and services. Products or services catering to the exact needs and wants can compete for your market share though such organizations sometimes offer a completely different set of products and services. This makes the state of competition in the sector depend on five fundamental forces determining its ultimate profit potential.
Take a look at Brunei Darussalam for an example. The country has been trying to improve agriculture as a part of its primary source of income. The above would enable them not to be relying on their oil and gas. This has also been included within the country’s vision Wawasan Brunei 2035. The country can grow into such an industry as the Minister of Industry and Primary Resources (MIPR) revealed plans to commit 1000 ha of land to livestock farming. This move would help reduce Brunei’s reliance on livestock imports from Australia, which was limiting domestic production. The land is expected to be used for concentrated animal feeding operations.
So, what can be done by Brunei’s start-ups and small-medium enterprises? There are so many ways the above can be taken into their considerations. The start-ups and the SMEs of Brunei can start to venture into the market by bringing new products and services positively related to agriculture and livestock. Apart from that, private institutions such as colleges can also offer agriculture programmes and majors that can help produce more skilful nations for agriculture.
Let’s look at the competition within the industry, locally. A lower percentage of people venturing into this industry could have strengthened the local producers’ bargaining power. But many foreign players are operating in the market due to the low entry barrier. The competitors are much higher and more robust, which can be considered a challenge for Brunei’s local agriculture industry. Due to the lower percentage of local people venturing into this industry, Brunei Darussalam has low power of local suppliers, making the customers have a higher bargaining power due to the higher percentage of international competitors.
Again, intense competition in an industry is neither coincidence nor bad luck. Such competition highlights the company’s critical strengths and weaknesses, animates its positioning in its industry, and clarifies the areas where strategic changes may yield the most significant payoff. Competition can also highlight the places where industry trends promise to hold tremendous significance as either opportunities or threats. Hence, understanding these sources again proves to be of help in considering areas for diversification.