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30 Examples of Competitive Risk

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Competitive risk is the potential for actions of a competitor to negatively impact your business. In a healthy competitive market, competitive risk drives improvements such as cost reductions and quality improvements. The following are common examples of competitive risk.
Price competition
Product functions & features
Market overcrowding
Substitute products
Loss of market share
Disruptive innovation
Customer churn
New competition
Promotional spending by competitor
Quality of competing products
Competitors with superior ratings & reviews
Employees leaving to work for competitor
Global competition
Resource competition
Product improvements of the competition
New products of the competition
Service quality of the competition
Intellectual property infringement
Knockoff products
Copycat innovations
Relationships of the competition
Sales prowess of the competition
Marketing prowess of the competition
Partners of the competition
Customer loyalty of the competition
Brand strength of the competition
Operational capabilities of the competition
Competitors with lower costs
Competitors with greater scale
Competitors with greater selection & variety


Steep discounts by a competitor can be a significant threat to a business, particularly a business that has a higher cost than the competition. Discounts may be driven by excess inventory due to supply/demand issues or as a aggressive pricing strategy that sparks a price war.


Innovation by a competitor can threaten a firm's entire business model.


A competitor who opens a location next to yours or who secures a better location. In some cases, competition close by isn't a bad thing as it can attract more customer traffic.


A competitor who is viewed as a more attractive employer may result in a loss of skilled resources.


A competitor's promotion may attract your customers away. In some cases, a competitor's promotion may directly or indirectly paint your brand or products in a negative light.


A competitor may achieve a preferred position with your distribution partners such as retailers.

Intellectual Property

A competitor may secure key intellectual property that is important to current and future products.
Overview: Competitive Risk
The potential for actions of a competitor to negatively impact your business.
Related Concepts
Next: Competition
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Budget Risk
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Customer Risk
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Dispute Risk
Enterprise Risk
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Platform Risk
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Short Squeeze
Technology Risk
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