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This results in many new entrants, which will effectively decrease profitability. Unless the entry of new firms can be blocked by incumbents, the profit rate will fall towards a competitive level (perfect competition).
* the existence of barriers to entry (patents, rights, etc.)
* economies of product differences
* brand equity
* switching costs or sunk costs
* capital requirements
* access to distribution
* absolute cost advantages
* learning curve advantages
* expected retaliation by incumbents
* government policies
The intensity of competitive rivalry
For most industries, this is the major determinant of the competitiveness of the industry...
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