Types
Product self-competition
Any company which provides multiple products may suffer from product self-competition. Similar products are more likely to have this issue. For example, a bakery which offersRetail location self-competition
A related issue involves two retail locations for the same company that are situated close to one another. The first location will likely see a decline in business when the new location is added. Just how far away two locations must be to avoid this effect depends on the type of business. ForProximity-based
Sometimes, there will be two separate instances of a retail business less than a half mile apart. For instance, Subway has become a densely populated fast food franchise, and the opening ofAs a stop-gap measure
Sometimes, brief internal competition can be a consequence of having clearance items in a store's inventory, in which prices are decreased to encourage customers to clear out the clearance items. Other tactics can involve delaying introduction of some versions of certain products since it can also save some companies money.Causes
Effects of mergers and acquisitions on self-competition
Self-competition is a common side-effect of mergers and acquisitions, as the new combined business often has similar products and nearby retail locations. The success of the business often depends on their ability to eliminate similar products and redundant retail locations. Ideally, the most profitable products and locations should be kept, regardless of the source company. In some cases, the best attributes of each product may be retained. For example, one company may offer a superior food product, but the other may have better packaging, perhaps a resealable bag.Effects of scale on self-competition
While any company which offers more than a single product can suffer from the effects of self-competition, the larger a company becomes, in terms of market share, the more it becomes an issue. In the case ofSee also
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