the action and reaction of rival companies in setting and changing prices for their offerings
managers should focus more on long-term – “look forward and reason backwards”
Competitors’ goals and objectives ?
Assumptions competitor made about itself ?
Strengths and weaknesses of competitor ?
Industry Characteristics and Risk of Price Wars Characteristics High Risk Low Risk Product/Service Type undifferentiated differentiated Market Growth Rate stable/decreasing increasing Price Visibility to Competitors high low Consumer Price Sensitivity high low Overall Industry Cost Trend declining stable Industry Capacity Utilization low high Number of Competitors many few