Competition in the market plays a vital role in making trading and service businesses dynamic.

The more companies compete with each other’s products and services, the more those companies are
driven to innovate, improve, and create goods with best possible prices, quantity, and quality. Also, the
more the competition, the more the products and services are efficiently advertised—making
consumers more aware of the product’s/service’s existence. As to what I observe, businesses which
make their products and services unique and affordable from the rest, the more customers are willing to
select their product because they offer a right balance between the product’s price and its quality. I
think that the number of sellers selling a similar good matter because it will help owners and managers
decide what strategy and adjustments they should make to keep their business’ products and/or
services more superior and patronized than others.

Competing companies or businesses are competing and cooperating with one another at the
same time. To elaborate my statement, here is an example. Different gasoline stations such as Petron,
Caltex, and Shell are competing businesses but, when one company has increased or decreased their
price for a certain type of oil, other companies will also follow the scheduled price changes. Also,
collaboration between competitors is in fashion. General Motors and Toyota assemble automobiles.
Siemens and Philips develop semiconductors. Canon supplies photocopiers to Kodak. France’s Thomson
and Japan’s JVC manufacture videocassette recorders. Even though these companies compete in the
market, they still cooperate with one another to expand their profitability.