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Rivalry in the industry can be weak, with few competitors that don't compete very aggressively. Or it can be intense, with many competitors fighting in a cut-throat environment.
Factors affecting the intensity of rivalry are:
Number of firms ? more firms will lead to increased competition.
Fixed costs ? with high fixed costs as a percentage of total cost, companies must sell more products to cover those costs, increasing market competition.
Product differentiation ? Products that are relatively the same will compete based on price. Brand identification can reduce rivalry.
New Entrants
One of the defining characteristics of competitive advantage is the industry's barrier to entry...
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