What does a competitive advantage allow a company to achieve?

A competitive advantage enables a company to achieve a favorable position over its competitors by leveraging unique strengths or resources that allow it to deliver greater value to customers. This advantage can manifest through various means, such as offering superior products, better customer service, or innovative processes that distinguish the company from others in the marketplace.

Having a favorable position means that the company can attract more customers and potentially command better pricing or market share compared to its rivals. This concept is central to strategic management, as establishing and maintaining a competitive advantage is key to ensuring long-term business success and sustainability.

While elements like lower production costs or price strategies can contribute to a competitive advantage, they are not in themselves guarantees of a favorable position. The focus is on how those advantages translate into better service, attracting customers, and outperforming competition, which encapsulates the core idea of what a competitive advantage represents.