[Autom. eng. transl.] The competitive advantage • It is a condition of superiority with respect to the average of competitors in the profitability of the invested capital in the medium to long term. • It is based on a condition of advantage over competitors based on the selling price (competitive price advantage) or on production costs (competitive cost advantage), meaning by production costs not only industrial costs, but all costs incurred for the performance of company activities (see Figure 2.22). The competitive price advantage (i.e. the higher return on invested capital deriving from the condition of advantage over competitors based on sales prices) presupposes (see Figure 2.23): 1. that the return on invested capital is above the average for the sector in the medium-long term; 2. that sales prices are higher than the average price of competitors. In this case, it is said that the advantageous company enjoys a premium price, that is, a price higher than the average, which gives rise to a price premium, or a "price premium", or "price difference", compared to average of competitors; 3. that the production costs do not show such a difference compared to the production costs of competitors to compensate for the premium obtained in the sales prices.
|Translated title of the contribution||[Autom. eng. transl.] Structure of the sector and positioning of the company|
|Title of host publication||La strategia di business|
|Editors||P Russo, V Coda, G Invernizzi|
|Number of pages||90|
|Publication status||Published - 2021|