REFLECTION PAPER #4

A competitive advantage is something that gives a business an advantage over its

competitors, allowing it to attract more consumers and increase market share by
producing services or items more efficiently or at a lower cost than the competition. A
company's competitive advantage must provide value for its stakeholders and be
difficult to replicate for others to be successful. The goal of having a competitive
advantage is to set a company apart from its competitors by providing something
unique and valuable to its customers. Competitive advantage also implies that the
company can outperform its market competitors and earn a bigger profit.

It is important to have a competitive advantage over your competitors in order to be

successful in business because:
● It can contribute to higher profit margins.
● It may help attract more customers more frequently.
● It helps maintain brand loyalty.
● It can add predictability and constancy to your company's revenue streams.
● It may help attract more brand alliances, talent and potential investors.

Firm performance is a measure of a company's performance that is influenced not

only by the company's efficiency but also by the market in which it operates. It's also
known as financial stability or financial health in the financial sector. There are a
variety of financial measurements that may be used to assess a company's
performance. Revenue, return on equity, return on assets, profit margin, sales
growth, capital adequacy, liquidity ratio, and stock prices are only a few examples of
common financial measurements. Depending on the industry in which the firm
operates, some financial ratios will be more important than others.

DISCUSSION: STARBUCKS

Starbucks is one of the world's most well-known brands. Because of the quality of
their marketing and their commitment to maintaining brand consistency, their brand
recognition has soared to new heights. They provide an experience for their target
audience when they visit their stores. They make the expense of the drink worth it in
their customers' views by focusing on the third place and providing a place for them
to be and interact. It's reassuring to get a good cup of coffee and be encouraged to
work while sitting in the café with your laptop and consistency. Even the cups,
tumblers and planners available for purchase at the store have a clean, modern
style. They don’t actually have plans of using the planner, people want the planner
because it’s a prize and a status symbol. They normally don't mind the price because
occasionally it's a limited edition planner. Starbucks' strategy is good in terms of
bringing joy to customers, particularly coffee drinkers. Moreover, the hiring of the
improper design director for the planner is one of the pitfalls that Starbucks must
avoid in order for this to function every year.