Competitive Environment of a business Environment, its types and unfair trade practices in competition

1. The most certain way
to succeed is always
to try just one more
time.

2. COMPETITIVE
ENVIRONMENT

3. • A competitive environment is the dynamic
external system in which a business competes
and functions.
• The more sellers of a similar product or
service, the more competitive the
environment

4. Types
• Direct Competitors
• Indirect Competitors
• Global Competitors

5. Direct Competitors

6. INDIRECT COMPETITORS

7. Global Competitors

8. Study of Competitive Environment
• According to Michael Porter’s five forces
model, the competitive environment of the
industries can be analyzed. These five forces
are as follows:
– Rivalry among existing firms
– Threat of new entrants
– Threat of substitutes
– Bargaining power of suppliers
– Bargaining power of Buyers

9. Unfair Trade Practices
• An unfair trade practice refers to that
malpractice of a trader that is unethical or
fraudulent. These practices cause an
inconvenience or grievance to consumers.

10. Unfair Trade Practices
• An unfair trade practice is defined under
Section 2(1)(r) of the Consumer Protection
Act, 1986. According to this definition, it is a
trade practice carried out for the promotion of
sale. It is the distribution or utilisation of any
good or service by adopting a deceptive
method or practice.

11. Unfair Trade Practices
• The following practices fall under unfair trade
practice:
1. An oral or written statement or visible
representation that:
– Falsely represents a good or service to be of a particular
standard, quality, grade and so on.
– Falsely represents any re-built, second-hand,
reconditioned, renovated or old goods as new.
– Represents that a good or service has sponsorship,
approval, uses, benefits and so on which they do not
have. The same could apply to the seller or service
provider. – Makes a misleading or false representation
regarding the need and usefulness of any good or
service.

12. Unfair Trade Practices
– Provides to the public any warranty or guarantee of the
performance of the length of the life of the product. A service can
be continued till deemed satisfactory.
– Gives a misleading image of the good, service or trade like the price
of the product.
For the above clauses, any statement made via expression by sellers
on the wrapper or container of the item can qualify for unfair trade
practice. The information of the product is also placed inside the
item, attached to the product, or accompanying it.
2. An advertisement published in any newspaper or other means of
communication to the general public may also result in unfair
trade practice if the price communicated is
misleading or a bargain price. This means that an unfair
trade practice would be when a rational individual on reading,
hearing or seeing the advertisement would think to be a bargain
price as compared to the product’s ordinary sale price.

13. Unfair Trade Practices
• Wrongful or deceitful permissions or expressions
like
• Allowing the sale of products, having the
knowledge or reason to believe that the product
is not up to the standards of a competent
authority. This could be in terms of design,
contents, packaging, etc.
• Permitting the hoarding or destruction of
products with the intention of raising the prices
of the goods.

14. Examples
• A dress has been used for 2 months and is now
being sold by a seller as a new dress.
• The battery of a mobile phone is guaranteed to
work well for one year but wears away in a
month.
• A geyser that is not ISI approved has an ISI mark.
• A table of Rs. 500 is sold online with Rs. 600
delivery charge, but the good is claimed by the
seller to be free of cost.