Competitive analysis – n : the art of analyzing an industry, sector or niche to determine the identity, size, market share, growth rates and competitive dynamics of all the businesses competing in that space. The key to valuable competitive analysis is to determine not only the numerical facts, but more importantly, to understand the competitive dynamics of the industry in question: What is the basis of competition (e.g., features, price, shelf-space, channels, brand image)? How does profitability vary among the various competitors and why? A comprehensive competitive analysis looks at each company’s competitive positioning and what each company’s competitive differentiation is within its sector. Many schools of thought exist regarding competitive analysis, and several different courses in each major MBA program focus on the topic.

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Adapted from "The CompanyCrafters Entrepreneur's Dictionary"
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